Strategic Autonomy in Post-Covid Trade Policy: How Far Should We Politicise Supply Chains?

07/28/2021

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Elvire Fabry and Andreas Veskoukis | Istituto Affari Internazionali

The resilience of supply chain (SC) is a key nexus in the debate over the European Union’s strategic autonomy that continues to divide member states. To reduce critical dependencies on external supply, both diversification of supply and the reshoring of production have their limits. Moreover, the growing rivalry between the United States and China calls for the development of a systemic approach to SCs’ resilience that takes into account all levels of subcontracting beyond the first tier of supply. This calls for going beyond the traditional positioning of EU member states in favour of free market or public intervention, to work on a close coordination of an industrial policy that relies on a stronger attractiveness of the Single Market and a trade policy that aims less at protecting strategic industries from foreign competition than at applying precautionary measures that protect populations from supply shortages.

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