Solving Supply Chain Disruptions to Bolster Economic Resilience

The global economy is facing a dilemma: how to solve the issue of supply chain disruptions that are shackling economic growth. The New Zealand Productivity Commission has been asked to look into the resilience of the New Zealand economy to supply chain disruptions, both internally and in trade. This is a critical issue for vulnerable communities and industries, as disruptions can have a devastating effect on the economy.

The commission is looking at ways to improve the country’s internal and external economic resilience to bolster its long-term future. Infrastructure NZ has welcomed the inquiry, particularly its focus on internal supply chains. It has highlighted the costs incurred by slow decision-making around infrastructure, which can lead to supply chain issues.

The commission is also looking at diversifying industry to offer broader options. This means diversifying where New Zealand sells and buys, so that there are options when disruptions arrive. Communities should also aim for diversified industry to offer broader options.

The example of Ōhura is a stark reminder of what can happen when an industry is too heavily reliant on one industry. The population of the town peaked at 654 in 1961, but when the state-owned coal mines closed in the early 1970s, many businesses and community services closed too, with the population now around 150.

It is clear that New Zealand needs to become more economically resilient to supply chain disruptions. We need to diversify our industry and trade, and make timely decisions around infrastructure to avoid further disruption. This is the only way to ensure that vulnerable communities and industries are protected from the effects of supply chain disruptions.