August 8, 2022

US Treasury Secretary on Supply Chain Resilience: Use Friends' Support

US Treasury Secretary on Supply Chain Resilience: Use Friends’ Support

US Treasury Secretary Janet Yellen (pictured here at a press conference, prior to the G-20 meeting in Bali on July 14), said supply chain resilience is a major focus of the Biden-Harris administration.

Made by Naji | Reuters

US Treasury Secretary Janet Yellen reiterated the need for the United States and its trusted trading partners to enhance supply chain resilience through “friends’ support,” but said that did not mean the United States was falling behind the rest of the world.

In a speech at the South Korean LG Group’s Science Park in Seoul on Tuesday, Yellen mobilized support from US allies to work together in building more resilient supply chains among trusted partners through “friends support.”

The term is based on the concepts of “internal supply” and “proximal supply,” which refer to moving supply chains home or closer to home, rather than having them in foreign countries. Friends Support goes beyond that but limits supply chain networks For allies and friendly countries.

The United States has been pushing for more security in supply chains since the pandemic began. we President Joe Biden signed an order in early 2021 to review US supply chains with the goal of reducing dependence on foreign suppliers.

“Supply chain resilience is a major focus of the Biden-Harris administration. The necessity of this work has been clearly demonstrated by the events of the past two years, first by Covid-19 and our efforts to combat the pandemic and now by Russia’s brutal war of aggression in Ukraine,” Yellen said.

“Together they have reshaped global supply chains and trade.”

“Working with allies and partners through the support of friends is an important component of enhancing economic resilience while maintaining the dynamism and productivity growth that comes with economic integration.”

However, these initiatives have raised fears of global economic decoupling, especially as the United States and other countries seek to avoid over-reliance on China.

Yellen said these measures do not indicate the United States is withdrawing from global trade. Instead, she said, it shows friendly countries are taking a long-term perspective on vulnerabilities in an effort to make economies more productive.

“We don’t want a retreat from the world that makes us give up on the benefits it brings to the American people, business markets, and exports,” Yellen said. Referring to the deepening of relations with South Korea.

“By doing so, we can help insulate both American and Korean households from price increases and disruptions caused by geopolitical and economic risks… In this sense, we can continue to strengthen the international order from which we have all benefited, while also protecting ourselves from fragility in networks world Trade “.

Supply chain resilience dominated this phase of Yellen’s visit to Asia, which followed last week’s trip to Bali for the G20 meeting.

South Korea’s LG also reaffirmed its recent collaboration with the United States, a $1.7 billion lithium-ion battery manufacturing expansion in Michigan, while Yellen outlined Hyundai’s electric vehicle and battery manufacturing facilities in Georgia and Samsung’s semiconductor chip plant in Texas. .

Other projects supporting supply chain resilience efforts include recently announced Indo-Pacific Economic FrameworkYellen added.

With ‘friends’ support, South Korea and the United States are in an ideal position,’ James Kim, president of the American Chamber of Commerce in South Korea, told connection. ”

“This is the most exciting stage I’ve seen in the last 18 years.”

Kim said that while there has been more direct investment from South Korea in the United States than the other way around, US interests in the Asian country are growing.

A recent poll by AmCham shows that for the first time, South Korea ranks as the second most attractive location for a regional headquarters in Asia, after Singapore, says Kim.