I don't believe individual government's protectionist practices will solve this mess. A collective action to create a balance is what will work. But each leader is also under tough scrutiny at home for the consequences of the melt down, so its going to take a while to resolve.
Ms. Daisy, Your analysis is pinpoint correct. However, the transfer of jobs to Asia has already happened and it's unlikely these manufacturing positions will return anytime soon back to the West. But it's also not only the West that is suffering as a result of China's domination of global manufacturing. I believe the situation is even more acute in developing economies, which are unable to compete as well for investment funds. The problem here is figuring out the optimal way for the global economic regions to interact in such a way that one area does not benefit too much at the expense of the others. How will these economic leaders sort out this mess without resorting to national protectionist practices?
The G20 meeting has just made it apparent to us all, that governments have no control on determining distribution or prices, the private sector does. The governments are beneficiaries of the success of the private sector. Governments of the G20 are protecting these benefits and making sure they are not eroded hence the belt tightning to free trade. Fair or not is another matter. The way to force China to play fair at this time is to curb imports from China while implementing policies that would stop outflow of manufacturing activities from the West.
Protectionism has been the game by EEU countries and the emerging economies of China and India in recent times. China's strong economic growth which sucked jobs from the West was partly built on protection of China's interest with the offer cheap labor to any one willing to move jobs to China. The offer was the bait the West bit on and are paying for it now in unemployment. US capitalism has also come home to roost - private ventures made decisions to move out the jobs and hoped competition in a free trade will help determine the prices.
Protectionism will certainly have an impact, Barbara, but I really wonder how much of that is just pure hyperbole. Certainly the companies that have fostered outsourcing and offshoring have a vested interest in being against so-called "Potectionism".
By the way, isn't that word "Protectionism" a fascinating sound-bite? It's that darn "Protectionism" that is really hurting those profits - not the unemployed workers here - or for that matter, the underpaid and poorly treated workers overseas.
The electronic indusry reached to a level that not only the companies are making their strategis but also the governements are hugely dependent on the industry. Because of the wide spread of the electronics in every application on earth it is even dictating terms to the leaders.
Protectionism will be the side effect of the inability and impossibility of enforcing “free trade” agreements.Without proper enforcement, fair competition becomes impossible.From this point of view, it seems like the US has been practicing “free trade” while the rest of the world has been practicing protectionism.Something’s got to give when many of the parties aren’t playing fair.
You are spot on, Bolaji, protectionism would be a disaster for the supply chain. It's easy to understand why countries are circling the wagons. But a global economy is just that, and one you can't opt out of when things get tough. Supply chain relationships have already endured a number of crises and come out intact--the 2001 inventory "adjustment" was particularly painful for the electronics industry. Let's hope the relationships in the supply chain are strong enought to weather this particular storm.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.