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The challenges inherent in today's international trade and the supply chains that service it are painfully obvious: higher prices of energy and food, shortages of and delays in delivering manufactured goods, dynamic changes in markets and sourcing regions. The ongoing effects of the pandemic, with its associated lockdowns and the war in Ukraine are proving catalysts to ignite underlying economic and environmental trends that will continue to fuel long-term changes in the pattern of global supply and demand.
TT Club is convinced that a thorough understanding of the practical risks is vital in mitigating the dangers to safety and security that are a consequence of these dynamic factors. “We are suffering from a disappearing ability to absorb short-term shocks to the supply chain because of fundamental societal and geopolitical changes to the global equilibrium,” commented Dorota Jilli, a senior underwriter at TT speaking at the Annual Conference of the European Sea Ports Organisation (ESPO) in Valencia this month. “Yes, COVID and the war are disruptive and are driving up prices but the longer-term trends of production cost increases in Asia and stricter demands of ESG (environmental, social and governance) mean that cheaper goods and transport services are features of a past global economy.”
