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The worst of the supply chain crisis may be over but mega threats persist, logistics expert warns
The acute supply chain crisis experienced by the logistics industry in recent years is almost over, a leading logistics expert has declared.
Speaking during his keynote speech at Logistics UK’s Supply Chain Resilience conference in the City of London last week (23 March 2023), Professor Alan McKinnon told a packed audience of senior industry representatives that the worst of the supply chain shortages were now behind them.
Providing evidence to back up his claim, McKinnon said that despite volatility during the pandemic, the Global Supply Chain Pressure Index compiled by the Federal Reserve Bank of New York had fallen more or less back to where it was in 2019. Data on average container freight rates compiled by Freightos told a similar story.
“There’s evidence there that we’re over the worst,” he said, while adding a word of caution that the industry was not yet entirely out of the woods.
While pressure has eased in supply chains, McKinnon argued that other mega threats remain. These included the growing threat posed by cyber-attacks, during a period when logistics is undergoing a period of rapid digitalisation, the cost-of-living crisis and a rise in natural disasters and extreme weather events.
Projecting forward ten years, McKinnon cited the World Economic Forum’s annual survey of risks. “The top four risk factors are all environment related,” he said, “If we fail to mitigate climate change, we have to suffer the dark consequences of that.”
Industry should not assume it could allow emissions to rise and extreme weather to increase and then adapt to this changing reality, as the time frames for doing so were extremely limited. McKinnon maintained that it was about 20 times cheaper to mitigate climate change today than it was to climate proof the built environment.
Quoting a recent journal paper on climate ‘end-games’, he said: “There are ample reasons to suspect that climate change could result in a global catastrophe. We should be fully aware of the challenge that faces us now in dealing with this.”
*www.logistics.org.uk/scr
Published On: 30/03/2023 16:00:08
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