Global supply chain issues have been effecting a lot of people over the last several months, causing price increases and product shortages. This has had many concerned for the future of the economy. Recently, however, an International Chamber of Shipping chair, Esben Poulsson, shared some encouraging news.
THE WORST IS OVER
In a November 23rd appearance on CNBC’s Squawk Box Asia, Poulsson said that retailers made a “significant level” of pre-orders which should help ease some product shortages. He also said that new container ships have been built and will slowly add to capacity over the next few years. Take a look at that interview here:
The Wall Street Journal also reported that the supply chain problems show signs of easing, claiming that costs for transporting ocean freight have come down from record-level highs.
PROBLEMS STILL PERSIST
Some of the issues that caused the crisis to begin with still persist. For example, regional COVID outbreaks, strong consumer demands, port congestion and truck driver shortages are all problems that still plague the system. Another issue that Esben Poulsson touched on in his interview is mandatory vaccines for travel have made it difficult for some ship crew members to travel to the ports where they work.
Another blow to the recovery would be if the global response to the new Omicron variant is as stringent as the response to the Delta variant. Per Hong of Kearney, a global management consulting firm, told CNBC, “A lot of unknowns, but Omicron is certainly setting up to be yet another test of resilience for global supply chains that were already under stress and in the midst of a lengthy healing process.”