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View this email in your browser <https://mailchi.mp/law/perspective-348?e=dd153d6a25> 哥伦比亚大学国际直接投资展望中文版都可以在我们的网站查看: https://ccsi.columbia.edu/content/columbia-fdi-perspectives <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=67c58f3023&e=dd153d6a25> . *Columbia FDI Perspectives* Perspectives on topical foreign direct investment issues Editor-in-Chief: Karl P. Sauvant ([log in to unmask]) Managing Editor: Abigail Greene ([log in to unmask]) *The Columbia FDI Perspectives are a forum for public debate. The views expressed by the authors do not reflect the opinions of CCSI or our partners and supporters.* No. 348 January 9, 2023 *How to make global supply chains more resilient* <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=7fdfab119f&e=dd153d6a25> by Gary Gereffi* <#m_1550552761379828342__edn1> Global supply chains (GSCs) have become a hot topic, ranging from pandemic-induced shortages of personal protective equipment and COVID-19 vaccines to military logistics, oil sanctions and wheat blockades following Russia’s invasion of Ukraine. Most recently, the Biden administration targeted the US semiconductor industry with direct subsidies in the August 2022 CHIPS and Science Act <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=aac0578a52&e=dd153d6a25>. On the diplomatic front, US Secretary of State Anthony Blinken and Secretary of Commerce Gina Raimondo hosted a 2022 Supply Chain Ministerial <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=30fd737988&e=dd153d6a25> with 17 partner economies and the European Union on July 19-20 in an effort to build resiliency through greater international cooperation. Supply-chain diplomacy involves both bilateral and multilateral initiatives addressing current vulnerabilities, including the US-EU Trade and Technology Council <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=3645bb1163&e=dd153d6a25>, the Indo-Pacific Economic Framework <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=0f66798e64&e=dd153d6a25> and the Americas Partnership for Economic Prosperity <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=cff4cf3dba&e=dd153d6a25> . Post-pandemic, companies have four main options to reduce rigidity and increase resilience <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=25fd3146d8&e=dd153d6a25> in GSCs: make them more *domestic* (e.g., reshoring, stockpiles); make them *shorter* (e.g., reducing the physical distances traversed by supply chains through regionalized production <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=fb10a40613&e=dd153d6a25>, such as Mexico and Central America for the US); make them *more diversified* (e.g., reduce dependence on one or a few countries); and make them more *digital* <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=65179cbb75&e=dd153d6a25> (e.g., digital versions of real products and using digital technology to track the supply chain better). Governments can support these initiatives in the longer term by following several principles outlined in extensive research carried out on GSCs, innovation, and development.[1] <#m_1550552761379828342__edn2> - *The most important product in GSCs often is not the finished good, but rather key components or raw materials.* Semiconductor shortages are a classic example because they are critical inputs for many end-product industries, from advanced electronics to automobiles and home appliances. Similarly, pharmaceutical active ingredients are key for essential medicines, while scarce minerals like lithium and cobalt are needed to make batteries for electric cars and smartphones. Emphasizing critical technologies and geographic shortages can help both governments and companies anticipate and overcome supply-chain vulnerabilities. - *Focus on solutions for high-priority markets.* Mature products may have greater opportunities for quick gains than advanced products. While cutting-edge semiconductors require large investments in new and costly wafer-fabrication facilities, the shortage of “legacy chips” used in mature products like cars and appliances might be addressed more quickly by retooling existing factories or alternatively redesigning chips for existing production facilities. - *International production partnerships are often necessary.* Contemporary GSCs can be staggeringly complex, requiring intricate cross-border trade and investment collaboration. For example, the COVID-19 vaccine developed by BioNTech and Pfizer involves 280 components from 86 suppliers sourced from 19 countries around the world. Furthermore, vaccine manufacturers <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=6b3988abc5&e=dd153d6a25> follow very different production strategies with numerous international partnerships. AstraZeneca has formed manufacturing partnerships <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=ca13a9bc97&e=dd153d6a25> with 16 contract manufacturers in 25 sites in 15 countries, and transferred technology to the Serum Institute of India, the largest vaccine producer in the world. Without such partnerships, which are utilized in most industries, governments could not handle the diversification, speed and scale required by global crises. - *Human capital is critical for resilient supply chains.* The US Government Accountability Office <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=2ce7dc2a6b&e=dd153d6a25> concluded that the most significant long-term strategy to address supply-chain shortages in semiconductors and other industries was workforce development. In the new semiconductor fabs being built in the US, including those likely to be supported by the CHIPS and Science Act, skills shortages are critical chokepoints.[2] <#m_1550552761379828342__edn3> The good news is that government policies to improve supply-chain resilience, such as training people to avoid skills shortages (e.g., cyber-security) as well as building skills to fill available jobs, can boost earnings and productivity. Intel’s two new semiconductor factories in Ohio <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=4aacfe2e70&e=dd153d6a25> are expected to employ 3,000 workers with an average salary of $135,000 per year. - *Reshoring or making supply chains more domestic does not guarantee resilience.* While the breakdown of GSCs has spurred calls to bring the production of critical goods back to domestic shores <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=4d41b110e8&e=dd153d6a25>, often this is not feasible technologically, and it would decrease the benefits of geographical diversification (e.g., for agricultural goods, energy grids or complex manufactures). Selective reshoring is possible and domestic stockpiles can be utilized, but they must be managed very carefully. Reorganizing supply chains to enhance strategic competitiveness and building a workforce with the needed skills for 21st century development is the best path for effective international and public-private partnerships. Both governments and companies play mutually supportive roles in advancing this critical objective. ------------------------------ * <#m_1550552761379828342__ednref1> Gary Gereffi ([log in to unmask]) is Emeritus Professor of Sociology at Duke University and Founding Director of the Duke Global Value Chains Center. The author wishes to thank Alvaro Cuervo-Cazurra, Lorraine Eden and an anonymous reviewer for their helpful peer reviews. [1] <#m_1550552761379828342__ednref2> This draws on insights from the voluminous academic literature on global value chains that tracks how, where and by whom value is created, captured and eroded in GSCs. See, e.g., Gary Gereffi, *Global Value Chains and Development: Redefining the Contours of 21st Century Capitalism* (Cambridge: CUP, 2018); Stefano Ponte, Gary Gereffi and Gale Raj-Reichert, eds., *Handbook on Global Value Chains* (Northampton: Edward Elgar Publishing, 2019). [2] <#m_1550552761379828342__ednref3> Of the projected employees in the typical advanced semiconductor plant, 70% will require two-year technical college degrees, 20% M.A. degrees and 10% Ph.D. degrees. *The material in this Perspective may be reprinted if accompanied by the following acknowledgment: “Gary Gereffi, ‘How to make global supply chains more resilient,’ *Columbia FDI Perspectives *No. 348. Reprinted with permission from the Columbia Center on Sustainable Investment (* *http://ccsi.columbia.edu* <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=895764aafa&e=dd153d6a25>*).” A copy should kindly be sent to the Columbia Center on Sustainable Investment at **[log in to unmask]* <[log in to unmask]>*.* For further information, including information regarding submission to the *Perspectives*, please contact: Columbia Center on Sustainable Investment, Abigail Greene, [log in to unmask] *Most recent Columbia FDI Perspectives* <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=bd1361fa37&e=dd153d6a25> - No. 347, Bernard M. Hoekman and Petros C. Mavroidis, “Investment facilitation in the WTO: The case for early harvesting,” *Columbia FDI Perspectives*, December 26, 2022. - No. 346, Yulia Levashova, “The way forward in reforming the legitimate expectations test,” *Columbia FDI Perspectives*, December 12, 2022. - No. 345, Alejandro Carballo Leyda and Frauke Nitschke, “Investment dispute management: The importance of the domestic dimension,” *Columbia FDI Perspectives*, November 28, 2022 *All previous FDI Perspectives are available at https://ccsi.columbia.edu/content/columbia-fdi-perspectives <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=81c6a32f22&e=dd153d6a25>* . *Other relevant CCSI news and announcements* - CCSI and the Sabin Center for Climate Change Law are hiring for the position of *Senior Legal Researcher, Climate Law & Finance. *The researcher will work collaboratively with CCSI's and the Sabin Center’s Leadership and Research Staff to analyze the interrelated legal, finance, and policy pathways critical to achieving global climate goals and facilitating the energy transition, and the corresponding implications for public, private, and institutional financial sector actors, regulators, and alliances. *More details on the position and instructions for applying can be found here <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=5406e40daf&e=dd153d6a25>* . - *Apply now* for our 2023 virtual *Executive Training Program on Sustainable Investments in Agriculture* from May 2-12, 2023. This interdisciplinary program explores challenges and solutions for advancing sustainable investments in agriculture. It includes asynchronous and synchronous components, including short and interactive live sessions dedicated to engagement with course lecturers and participants from around the world. Applications will be considered on a rolling basis until March 15, 2023. *For more information, and to apply, visit our website <https://columbia.us6.list-manage.com/track/click?u=ab15cc1d53&id=d25da3f2a0&e=dd153d6a25>* . Karl P. Sauvant, Ph.D. Senior Fellow Columbia Center on Sustainable Investment Columbia Law School - Columbia Climate School *Copyright © 2023 Columbia Center on Sustainable Investment (CCSI), All rights reserved.* [log in to unmask] *Our mailing address is:* Columbia Center on Sustainable Investment (CCSI) Columbia Law School - Columbia Climate School, Columbia University 435 West 116th Street New York, NY 10027 Add us to your address book <https://columbia.us6.list-manage.com/vcard?u=ab15cc1d53&id=a61bf1d34a> unsubscribe from this list <https://columbia.us6.list-manage.com/unsubscribe?u=ab15cc1d53&id=a61bf1d34a&e=dd153d6a25&c=fa28b89a19> update subscription preferences <https://columbia.us6.list-manage.com/profile?u=ab15cc1d53&id=a61bf1d34a&e=dd153d6a25&c=fa28b89a19> [image: Email Marketing Powered by Mailchimp] <http://www.mailchimp.com/email-referral/?utm_source=freemium_newsletter&utm_medium=email&utm_campaign=referral_marketing&aid=ab15cc1d53&afl=1> -- *Karl P. Sauvant, PhD* *Senior Fellow* *Columbia Center on Sustainable Investment* Columbia Law School, Columbia University 435 West 116th St., Rm. JGH 825, New York, NY 10027 | p: (212) 854 0689 | cell: (646) 724 5600 e: [log in to unmask] | w: www.ccsi.columbia.edu | t: @CCSI_Columbia <https://twitter.com/CCSI_Columbia> "Three Reasons Why a WTO Agreement on Investment Facilitation for Development is Important", "Six Reasons for Emphasizing Responsible Business Conduct in the Nascent WTO Agreement on Investment Facilitation for Development", "The WTO Investment Facilitation for Development Agreement Needs a Strong Provision on Responsible Business Conduct", *Investment Facilitation for Development: A Toolkit for Policy Makers. Second Edition,* "Agenda for Practice-oriented Research", "How Would a Future WTO Agreement on Investment Facilitation for Development Encourage Sustainable FDI Flows, and How Could it be Further Strengthened?”, "Incentivising Sustainable FDI", "Green FDI: Encouraging Carbon-neutral Investment", "Extending International Legal Aid from Trade to Investment: An Advisory Centre on International Investment Law", "More Attention to Policies! Improving the Distribution of FDI Benefits", "Facilitating Sustainable FDI in a WTO Investment Facilitation Framework: Four Concrete Proposals", "An Inventory of Concrete Measures to Facilitate the Flow of Sustainable FDI: What? Why? How?", are available at https://ssrn.com/author=2461782 . ____ AIB-L is brought to you by the Academy of International Business. For information: http://aib.msu.edu/community/aib-l.asp To post message: [log in to unmask] For assistance: [log in to unmask] --- You must be an active AIB member to post to AIB-L . 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