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GLOBAL SUPPLY CHAIN CHALLENGES FOR SIDS


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Published:Tuesday | July 9, 2024 | 12:06 AM
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THE EDITOR, Madam:

The recently held United Nations Conference on Trade and Development’s (UNCTAD)
Global Supply Chain forum, hosted in Barbados, highlighted four major areas that
continue to disrupt supply chain ecosystems within the Caribbean: debt distress;
unfair trade; investment deprivation; and the location of small island
developing states (SIDS) within the hurricane belt, which keeps us vulnerable to
climate emergencies. The term ‘supply chain disruption’ refers to any event that
causes an interruption in the production, sale, or distribution of products,
service and information within the supply chain. SIDS are confronted with
significant challenges in maintaining resilient global supply chains. For
example, transportation and insurance costs rose sharply, by 76 per cent, during
the pandemic, far exceeding global averages. The question is, are Caribbean
nations making themselves more prepared and ready for global supply and value
chains, knowing very well that their prosperity is linked to the connectedness
of the rest of the world?

As these leaders discussed the global disruptions that are causing ships to
remain at sea longer and emit greenhouse gases, it is essential to highlight
that Jamaica recently faced the impact of climate change in the form of
Hurricane Beryl. Warmer ocean temperatures have produced the strongest hurricane
ever recorded this early in the year, which has since caused delayed shipments
of goods and services. Additionally, climate-induced drought has lowered the
Panama Canal’s water levels, reducing daily transits from 36 to 22 vessels, with
potential of further reductions if conditions do not improve. These factors
delay shipments and movements of key personnel, underscoring the vulnerability
of the supply chain for SIDS. These challenges underscore the urgent need for
adaptive strategies within supply chains and international collaboration to
enhance resilience and ensure sustainable development for SIDS amid evolving
climate conditions.

The SIDS, recognised by the United Nations for their geographical isolation,
limited resources, and reliance on imports for essential goods, face severe
vulnerabilities. Barbados Prime Minister Mia Mottley also emphasised these
issues at the UNCTAD Global Supply Chain Forum, highlighting how SIDS
disproportionately bear the burden of high transport, insurance, and maritime
import costs, compared to larger economies.

It is crucial for SIDS to develop a strategic focus on transportation
infrastructure, given the clear vulnerabilities we face. Legislative reforms
related to trade, such as streamlining customs and other procedures, should be
prioritised. While regional efforts on transport and logistics infrastructure
are necessary, it is equally important for us to invest in our logistics hubs
locally, investing heavily in training of our staff and technology. Companies
within the sector need to adopt global standards to achieve resilience. Digital
technologies and innovation are key to global supply chain resilience.


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However, without support from international partners, SIDS will continue to face
significant supply chain challenges in the future.



GROUP COHORT 7

MSC Logistics & Supply

Chain Management

Mona School of Business

and Management


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