APEC and trade sustainability

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The pandemic has increased inequality which could lead to political and socioeconomic instability. It has also caused businesses to rethink their business model, switching their business model from a just-in-time model to a just-in-case model. Under the previous system, companies sourced parts and services from all over the world to produce goods as quickly as possible. Now, companies are “building redundancies,” holding precautionary stocks and sourcing parts and services from a diverse set of suppliers, Kuriyama said. Building this resilience is costly and it’s very hard to tell at this point if this is going to be sustainable. Global economic growth coupled with heavy storms like El Niño that cause fishing production to plummet and floods and other natural disasters that destroy agricultural products can all impact the ability of countries to trade sustainably in the long run. APEC members must be aware of and ready to face these challenges.

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