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Your gifts won’t arrive until Christmas!

„California ports will operate on a 24/7 basis. The ports will therefore be more ambitious than prof. Matczak recommends, but so what? In America, the shelves in the stores are empty. Ports can’t keep up with unloading goods. Because of the huge delays in the delivery of goods and semi-finished products, it may turn out that this year… we won’t see presents for Christmas”- says Andrzej Kohut in the latest KluboTygodnik.

„Because of the pandemic, restaurants, stores and services stopped, and as a result, consumption dropped and people started spending less money. But that doesn’t mean that they started having less money. For those who lost their jobs, the federal government quickly found a solution – it began to subsidize state unemployment benefits. It turned out that thanks to these subsidies in some states benefits were even higher than the payments they had received before. First Donald Trump and later Joe Biden introduced a kind of unconditional basic income, i.e. a single payment for every American. The benefits started to multiply, people started to have more and more savings and after some time consumption started to increase again. Americans began to spend on durable goods and this trend has continued, even though the lockdown is gone. The demand for specific goods has increased and this is where the problem begins”. – Andrzej Kohut describes.

„U.S. ports just got clogged up. In October, there were reports that at least 70 container ships waiting outside of two California ports, unable to enter. Each can hold up to 10,000 containers. Above all, logistic take much longer – trucks that used to pick up goods within an hour now wait up to 12 hours. These two Californian ports handle almost 40% of all goods that enter the USA. Pictures of empty shelves in stores are circulating on the Internet, and the media is increasingly asking the question, will there be a Christmas this year? Thus, a discussion about supply chains has begun overseas. What do we know about them? First of all, they are global – we take raw materials from Africa, we create semi-finished products in China, they are assembled by one factory in Malaysia and finally the product reaches the European markets. Secondly, they are highly optimized – in the past, a production plant would stockpile raw materials, but today we know that this model is extremely expensive. During the crisis, however, it turned out that this current system is not very flexible,” the expert reports.

„Delays at U.S. and Chinese ports have increased the travel time for products from China to the United States from roughly two weeks to more than two months. In such a system, one problem quickly spills over into others – so now the Chinese is also facing a shortage of container ships stranded at ports. The situation on the coast is also affecting transportation prices for products like soybeans, which is hitting farmers directly. Joe Biden had to address this problem, not only for security of supply, but also for image reasons” – Kohut concludes.

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Public task financed by the Ministry of Foreign Affairs of the Republic of Poland within the grant competition “Public Diplomacy 2021”. The opinions expressed in this publication are those of the authors and do not reflect the views of the official positions of the Ministry of Foreign Affairs of the Republic of Poland.