When it comes to supply chain issues the U.S. is totally dependent on China. In fact, China is the sole supplier of all kinds of items vital to the U.S. economy, military and every day live!
As China follows a clear “One China” policy, tension between the 2 power nations are on. But the U.S. are reliant on China for so many essential things that you simply cannot be reliant on an unfriendly nation for. China accounts for 80% of rare earth production and refining. Rare earth metals are used as critical components in high-tech devices that are vitally important for both our economy and our military. China also provides 100% of the natural graphite needed for batteries, produces 97% of the silicon wafers used in solar panels and houses 80% of the world’s lithium-ion battery recycling capacity. Pharmaceutical manufacturing has been “outsourced” from the U.S. to Asia. There are estimates that the U.S. imports virtually all of certain antibiotics and over-the-counter pain medications from China, plus a high percentage of drug treatments for depression, Alzheimer’s, HIV and other ailments.
Imagine if the supply of these essentials were cut off, like Russia does with energy to Europe?
While capitalist economics pushed the U.S. supply sourcing to communist China, the changing world power dynamics are pushing U.S. companies to move their supply chains much closer to home in order to improve supply security.
To do so, you do not have to look any further than Mexico. To diversify their supply chains, Mexico offers a lot of benefits: close proximity, easy access to ports, highly skilled and educated workers, and its modern infrastructure.
Sven Franssen