The concept of “security” has been relatively irrelevant to the “supply chain,” which has traditionally been the domain of international trade. The traditional role of international trade is to produce goods at the optimal cost through global supply chains and to increase the profits of countries through trade based on the theory of comparative advantage. As the relationship between China and the United States has been growing increasingly adversarial, policymakers, businesses, and even consumers are trying hard to cope with the changes in trade. A new concept, “economic security,” has been emerging. In April 2022, Janet Yellen, the U.S. Secretary of the Treasury, claimed at a seminar hosted by the Atlantic Council that the Bretton Woods system and the neoliberal world order that emerged after World War II need to be rebalanced and that the era of economic efficiency alone is over. Yellen argued that the old system needs to be reformed with friendly countries that share core values and norms. Through friend-shoring, she said, we should build a free but secure trade order, not “free trade.” Yellen's speech captured the essence of the U.S. commitment to reshaping the world order. Friend-shoring represents the end of off-shoring and the expansion of supply chains in pursuit of economic efficiency. Instead, the beginning of reshoring (and the return of manufacturing to its home country) represents a new U.S. trade policy that seeks to build trade relationships with friendly countries. This session will discuss the policy change of the U.S. government and its impact on businesses with global operations.
This panel was presented at the Fall 2023 Asia/Pacific Conference on “Law and Technology in a Changing World” in Seoul, South Korea.
