PC to investigate supply chain vulnerabilty

The federal government has given the Productivity Commission the task of reviewing Australia’s supply chain vulnerabilities and risks following the shocks of the Covid-19 pandemic.

The Productivity Commission will look at Australia’s supply chains, as well as longer term trends in relation to Australia’s linkages and dependencies on international trade and assess whether vulnerabilities or opportunities exist.

The PC will also examine the nature of the risks to the Australian economy as a result of global supply chain disruptions, identifying any significant vulnerabilities and possible approaches to managing them.

According to the economic think tank: “The Commission will develop a framework for identifying supply chains that are vulnerable to disruption, identify imports of goods that might be vulnerable, and identify possible strategies to manage supply chains risks.”

The Commission will also focus on:

• how firms manage and respond to disruptions in export market conditions and access
• the impact that these disruptions can have, including in regional areas.

Australia’s supply chains were tested during the Covid-19 pandemic with shortages appearing on supermarket shelves and some import supply chains interrupted or severed.

In 2019-20 the total value of Australian goods and services trade was $873.1 billion.

Terms of reference are available here.

The Productivity Commission’s will undertake consultation, and provide a report on Australia’s role as an importer in March 2021 and a second and final report on Australia’s role as an exporter in May 2021.

Picture: Treasurer Josh Frydenberg

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