Trump administration pushing to rip global supply chains from China
According to officials familiar with U.S. planning, the Trump administration is “turbocharging” an initiative to remove global industrial supply chains from China. This is as the administration weighs on introducing new tariffs to punish Beijing for its handling of the coronavirus. The Trump administration has long pledged to bring back manufacturing to the U.S. from overseas. However, the economic destruction caused by the coronavirus and the rising daily coronavirus death toll are driving a U.S. Government wide push to move the U.S. production and supply chain dependency away from China.
“We’ve been working on (reducing the reliance of our supply chains in China) over the last few years but we are now turbo-charging that initiative,” according to Keith Krach, undersecretary for Economic Growth, Energy and the Environment at the State Department. It was also noted that the U.S. Commerce Department, State, and other agencies are looking for ways to push companies to move both sourcing and manufacturing out of China. Current and former officials suggest that tax incentives and potential re-shoring subsidies are among measures being considered to spur changes.
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Hapag-Lloyd Chief: Some shipping lines may not survive the downturn
Some container shipping companies could collapse if the global trade downturn if the effects of the coronavirus lockdowns extends to the end of the year or beyond, according to Rolf Habben Jansen, Chief Executive of Germany’s biggest shipping company Hapag-Lloyd AG.
“The shape of the recovery is very uncertain,” Jansen, said in an interview. “We are cutting costs as much as we can to counter the missing volume and to have sufficient liquidity.” However, many shipping lines are facing mounting pressure as a result of having to cancel up to a quarter of their sailings due to extensive lockdowns and collapsing demand in the U.S. and Europe. With the pressure set to continue in the coming weeks, the industry hopes for a slow and steady recovery in the third quarter.
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USDA to purchase surplus food products
The effects of the coronavirus on the food and agricultural industry has led to gallons of milk being dumped, vegetables being ploughed and other food rotting and being wasted with the criticism that the U.S Department of Agriculture’s (USDA) efforts have been slow thus far. In order to try and prevent this, the USDA has announced that it will spend $470 million to buy surplus food during the pandemic. Products which will be bought include fruits, vegetables, meat, dairy and seafood, all of which have been negatively impacted by the loss of food service business.
This will allow more products to be distributed to communities nationwide while giving financial support to struggling producers and prevent waste. “America’s farmers and ranchers have experienced a dislocated supply chain caused by the Coronavirus,” U.S. Secretary of Agriculture Sonny Perdue said in a statement. “USDA is in the unique position to purchase these foods and deliver them to the hungry Americans who need it most.”
Although this additional surplus purchase could help some farmers and producers stay afloat and stop dumping food, industries will likely continue to advocate for more support as the pandemic drags on.
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