Resilient Global Supply-chain Creation Among G20 Countries

Economic globalization has achieved a major breakthrough in global supply chain operations in recent decades. Raw materials and services are procured from multiple locations beyond the domestic economy and distributed through complex networks to other locations around the world. The COVID-19 pandemic, however, has disrupted both domestic and global components of supply chain systems and impacted their resilience. Logistics bottlenecks and fleet shortages combined with capital and financing difficulties, especially for shipping companies outside the Main Line Operators (MLOs) alliances, have led to chronic price increases. Even before the pandemic, Indonesia’s domestic supply chain was suffering inherently high costs from discrepancies in regulations, system operations, infrastructure facilities and more. Added to this are costs associated with domestic and international Sustainable Development Goal (SDG) commitments on climate change, green economy and other sustainability issues. These developments call for supply chain enhancement policies to contribute to those externalities as well as to alleviate high costs in the supply chain ecosystem. Enhancement can be achieved both at upstream level via smart industry and trade policies, and at downstream distribution level via smart logistics. G20 members should cooperate to build the required global resilience and sustainability in supply chain systems. This Policy Brief proposes empowerment of Single Window (SW) systems, at domestic, regional and global levels. The proposals focus on trade and investment facilitation, and the contribution from digitalization of supply chain systems within the SW framework. It calls in particular for digitalizing exchange and processing of data and information among SW stakeholders, and integration of several digital platforms to empower them for more resilient supply chain operations.