President Biden tackles US supply chains in first month in office

Biden expected to issue new executive order looking at supply chain vulnerabilities, following on from a flurry of legislation that will affect supply chains both domestically and globally

Image by RENE RAUSCHENBERGER from Pixabay

US president Joe Biden is widely expected to issue an executive order shortly that will require a government review of the critical supply chain in an effort to reduce too much reliance on external sources for critical technology and materials.

Agencies are expected to be given one year to provide classified and non-secret recommendations aimed at strengthening domestic reliance and adding capacity, although recommendations are also expected to be accepted and implemented within the one-year time frame where appropriate.

The anticipated order will follow on from what appears to be an increased focus on supply chains under the Biden administration compared to his predecessor. Already, Biden has instituted a separate order requiring an increase in domestic content requirements for government procurement contract under the “Buy America” banner and signed in another executive order shortly after inauguration that addressed shortfalls in supply chain supporting the effort to fight COVID-19.

The stimulus bill currently working its way through the US legislature also includes provisions to inject cash directly into the country’s transport infrastructure, namely $30 billion to transit agencies, $14 billion for passenger airlines, $8 billion to U.S. airports, $1 billion for airline contractors and $1.5 billion to Amtrak.

Sources said the upcoming order was not specifically aimed at China, but is part of Biden’s campaign-trail commitment to examine supply chain vulnerabilities that have been highlighted by the COVID-19 pandemic, and to look at the implications for technologies and materials used in key manufacturing areas and for military purposes.

While it intends to work with foreign allies, the US is increasingly concerned about European prioritisation of strategic autonomy, as well as the ongoing concerns about potential national and economic security threats posed by China. 

Earlier work by the Trump administration on the supply of rare earths, other critical minerals and semiconductors, is expected to be taken into account.

The Biden team has said it will impose targeted restrictions on imports from nations that could pose security threats. As well as focusing on vulnerabilities, the policy is aimed at boosting domestic manufacturing.

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