5pm Tuesday 30 June 2020
“I thought it was a very well-organised event.” Martin Wolf CBE, Chief Economics Commentator, Financial Times
On Tuesday 30th June the International Trade SIG delivered a panel discussion event as part of the IoD Business As Unusual webinar series. The keynote was given by Financial Times Chief Economics Commentator Martin Wolf CBE, and he was followed by Maureen O’Shea, KPMG Supply Chain Partner and Sandy Gullis MBE of Essentra.
The learned panel complemented each other in their discussions: Martin Wolf in his signature no-nonsense, emphatic style gave a macro global 5-10 year view, highlighting uncertain forecast curves, the rise of protectionism particularly between the US & China, and went on to express very bearish views about the belt and road initiative for the UK, as we are at the ‘end’ of it. Martin gave his views that there would be no free trade agreement with China at the expense of UK’s relationship with the US and highlighted problems with that relationship if we pursue a closer bond with China, policy-makers being more US than China aligned and a general desire for a mutually exclusive free trade agreement with US being preferred by them, at the exclusion of China. Martin went on to highlight the controversy of Chinese investment being perhaps insurmountable – prospects for economic relationship with China quite difficult and the best-case scenario as status quo; he sees no great expansion in UK-China trade and investments.
The Covid-19 shock to world trade
Maureen O’Shea gave a concise Consultants’ 2-3 year regional view which was exceptionally gloomy about the prospect of the next bump in the road after COVID, Brexit, and the impact on UK supply chains. Maureen expounded change in the model of collaboration for uncovering hidden supply chain risks. Even though there is a 6-month delay on Brexit customs implementation of inbound, but that’s not on outbound, and ‘trucks do roundtrips.’ Maureen spoke about the shift from ‘just-in-time’ manufacturing to ‘just-in-case’ and balancing priorities to match risk and benefit as this shift affects working capital. She talked about more ‘value-focused’ buyers looking at the longevity of their suppliers and perhaps reassessing strategy. Maureen highlighted the importance of a Supply Chain risk assessment with some level of robustness by Christmas being very important for resilience.
Sandy Gullis MBE gave a local view of now and the next 6 months, detailing UK-EU and local logistics. Sandy discussed ‘supply and demand’ becoming ‘supply and profiteer’ in some cases as companies look to ‘optimise’ the effects of COVID, for example a fuel company charging fuel surcharge even through fuel price has decreased! He mentioned the priority of PPE bumping less crucial stock delivery into the future. Panic buying has put a strain on the supply chain with double ordering now a commonplace occurrence, putting pressure on working capital. Sandy’s major concerns about SMEs preparing for Brexit being that they ‘will wait for the cart, and put the horse after it’.
The Q&A was terrifically exciting with too many questions than the panel had time to answer, on such topics as whether the belt and road initiative will really affect UK, supply chain talent, the role of women in global procurement, and whether Brexit will actually happen in January!
The networking was a fabulous affair with some varied discussion tasks and very entertaining summaries!
The feedback from the event was extremely positive, we will be hosting the second IoD International Trade Group webinar on 20 October – I hope to see you there.
International Trade Group, IoD Central London
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