- It is really important that we are able to draw in more people into the global trading system, including women, including the disabled, so that we can create more development, more growth, that’s going to help us achieve the SDGs.
- If we are going to successfully tackle issues like fixing the environment, stamping out child and forced labor, or making the workplace more gender-friendly, we need to do it through supply chains.
- The pandemic did show us that there are ways to make these supply chains more secure and less vulnerable to shocks.
This video provides a synopsis of the inner workings of supply chains. The supply bottlenecks, during the COVID-19 global pandemic, brought supply chains into sharp focus. The pandemic presented an opportunity to transform supply chains to make them future ready including being green, resilient, inclusive, transparent, and socially responsible. Additionally, TSCFP recognized an immediate need during the pandemic to map the supply chain for critical COVID-19 fighting goods and created the supply chain mapping tool. The tool is available on the ADB website for free.
The response to the mapping tool has been gratifying. With the tool, banks, governments, and companies can more easily identify bottlenecks in the supply chain – to address those bottlenecks – to alleviate whatever problems were impeding the ability to enhance production and delivery and supply of these critical COVID-fighting goods.
Transcript
How much thought did you give to the inner workings of global supply chains before the pandemic? Probably not a lot.
The conversation around trade and supply chains has been completely transformed by the COVID-19 pandemic and other world events. We’re living at a pivotal point in the history of global trade and supply chains. It’s both exciting, and daunting, because the world has woken to the fact that.
On climate, for example, we now realize that up to 80% of the global carbon footprint can be traced to trade and supply chains so if we don’t green this space, we won’t be able to achieve our ambitious climate targets that we have set for ourselves, that are so critical.
On the importance of” inclusion” in globalization, we know we need more people in global trade, and so part of that, is closing financing gaps particularly among small and medium sized businesses.
This is really important to ensuring that we are able to draw in more people into the global trading system, including women, including the disabled, so that we can create more development, more growth, that’s going to help us achieve the Sustainable Development Goals.
And that’s why in 2022 ADB’s Trade and Supply Chain Finance Program supported almost 7,000 transactions valued at $7 billion with guarantees and loans. And these transactions included support for small and medium sized businesses.
But beyond providing guarantees and loans to support trade, the Program undertakes non-financial-market initiatives to make trade and supply chains Green, inclusive, transparent, socially responsible, and resilient. And these aren’t just empty slogans. We’re undertaking, in close partnership with a variety of entities, externally, internally, specific initiatives to tackle each one of these issues that are critical to our time.
Now, there isn’t enough time in a talk like this to discuss each of these initiatives, so I’ve been asked to focus on one specific initiative that we undertook to drive transparency into the supply chains of critical COVID-fighting goods. So that we can try to unblock some of the bottlenecks that were impeding the production and delivery of critical COVID 19-fighting goods.
We contacted partner banks to understand which of their clients are involved in the supply chains for making critical COVID-fighting goods like masks, gowns, and ventilators, and other important pandemic-fighting products.
But what we soon realized is that the banks themselves didn’t realize which of their clients were involved in this critical supply chains.
And then we contacted international medical associations, and they too, didn’t have a clear understanding and visibility on these supply chains for these critical COVID-fighting goods.
So, working with partners, we used big data to gather the information on who makes what in these extremely important supply chains. That data did indeed exist. As anyone who owns an exporting business will be quick to tell you, there is certainly no lack of documentation and record keeping when it comes to supply chains.
But that information was piecemeal. There was no single repository that would allow us to trace exactly which company makes which component part of these critical COVID-fighting goods. So that’s what we invented.
In May 2020, we launched our supply chain mapping tool and offered it up for free on the ADB website. Now, anyone can pick a product, COVID-fighting product, there are 34 of them on the website, and they can trace that product to who makes it and distributes it. They can see where it is made. They can trace more than 34 of these COVID-fighting products and the component parts that go into it, down to the base metal or fabric or rubber.
The response to the mapping tool has been gratifying. Now with the transparency that this initiative has delivered for 34 COVID-fighting goods, banks, governments, and companies can more easily identify bottlenecks in the supply chain – to address those bottlenecks – to alleviate whatever problems were impeding the ability to enhance production and delivery and supply of these critical COVID-fighting goods.
So, this is just one small example of how we can make supply chains more resilient. And mapping supply chains is just a small part of what’s needed. If we are going to successfully tackle issues like fixing the environment, stamping out child and forced labor, or making the workplace more gender-friendly, we need to do it through supply chains.
To succeed, we need to be able to see deep into those complicated networks. We need to be able to determine who makes what and where, and we need to drive transparency and digitalization, through global supply chains that we can fix problems. So that we can monitor environmental and social standards. So that we can ensure that any kind of bottleneck that impedes the production and delivery of critical goods is addressed and addressed urgently.
So, the pandemic did show us that there are ways to make these supply chains more secure and less vulnerable to shocks. And fixing them, for example by moving trade into the digital world will also make some of the biggest issues we face easier to tackle.
If I can leave you with just one thought, it’s that we’re at a pivotal time in the history of global trade and supply chains. And that’s because many of the critical issues facing our generation need to be addressed through making global trade and supply chains green, inclusive, transparent, socially responsible, and resilient.
Thank you very much.
