Twitteretter

Maybe there are not enough global supplies of PPE and coronavirus tests. But why is my government not securing a bigger share? Why are we losing the race with other countries? This does not depend on competence. The ability to quickly procure these goods in a global supply market is mainly a function of the commercial contacts a country’s industry had before the pandemic. It is akin to what might happen if an effective, cheap treatment was discovered and all restrictions lifted. Imagine 500 people suddenly flocking to a bar which has 100 beers, where beer price is fixed in real time, because of excessive demand, and payment is on a loyalty card. Not everyone will get a beer, and your competence is not really an advantage. Knowing the barmen and already having an account from before lockdown will be. While other people are filling registration forms and having their credit worthiness checked, you will be happily sitting in the sun outside, drinking your cold beer, looking competent L...

In the last few weeks, amidst difficulties to procure PPE and ventilators, amongst others, experienced by all countries, a school of thought has started to gain traction. We got it wrong with globalisation and need to bring back to each country the manufacturing of strategic or critical goods. This is a natural kneejerk reaction to current difficulties, but may not be very smart. Globalisation is the global implementation of division of labour, by which we all become richer by each community manufacturing goods they have the capability and skills to manufacture, gaining from scale and concentration of labour and with supply chain contributing to GDP. Should we give that up to avoid this situation again? What is the sustainability of many companies in many countries making goods we may not need for many years? What we need may be rather a more geographical sparse supply chain for these goods and a better legal framework for fair supply in times of crisis. May be too civilised for us ye...