Geopolitics Prompt Importers to Alter Supply Chains

One in five British importers have altered their supply chains because of geopolitical tensions, particularly with China, new research suggests.  

A survey by the Institute of Directors (IoD), found that 20.5% of importers have altered their supply chains because of tensions abroad, while a further 14.5% were considering doing the same.

Just 42.4% of importers said their supply chain had been unaffected by the geopolitical tensions.

Many firms have become “more risk aware” since the pandemic and the invasion of Ukraine, the research suggested, and are looking for stability.

Some are particularly concerned about sudden disruptions to their supply chains if UK-China relations deteriorate as well as the security of their data in Chinese systems, according to the IoD.

Emma Rowland, trade policy adviser at the IoD, said:

"It is clear businesses are sensing geopolitical-shaped clouds on the horizon, particularly while China's standing with the US, Russia and Taiwan remains uncertain.

"The pandemic, coupled with the invasion of Ukraine, has exposed vulnerabilities in international supply chains and an overreliance on countries perceived to be high-risk to the UK.

"Ultimately, firms are pursuing long-term stability in their supply chains, so they can provide certainty to their customers."

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