The coronavirus pandemic may have laid bare the US’ heavy dependence on other countries for medical supplies, but President Donald Trump’s calls to bring manufacturing completely back to American soil are unrealistic, say experts.
Instead, a rebalancing is needed, they said at a briefing by the Washington-based National Press Foundation on medical trade wars.
“We’ve been hearing… that Covid-19 is perhaps the end of globalisation as we know it, that the global chains have not been able to deal with these kinds of problems,” Professor Gary Gereffi, sociologist and director of Duke University’s Global Value Chains Centre, said on Tuesday, referring to shortages of medical devices and personal protective equipment.
“I believe that domestic production in these medical devices and personal protective equipment is definitely going to increase in the next few years,” he said. “But it’s not going to displace or replace globalisation per se.”
As the coronavirus spread in the United States, demand for N-95 masks has shot up from the usual 50 million a month – about a fifth of which are used by medical professionals – to 300 million a month, almost all for medical use.
Images of doctors and nurses in virus hot spots being forced to wear bandanas and garbage bags in the absence of masks, gloves and gowns went viral, while American companies like 3M and Honeywell raced to ramp up production of such supplies in their factories.
On May 14, the Trump administration announced that it was expanding the federal stockpile of masks, gowns and other crucial drugs to ensure a 90-day reserve for future events, and that they would be made by American companies.
“You know what a globalist is? They want the globe to do well, but they don’t care about us. Now we want everybody to do well. But we have to take care of America first,” said Mr Trump, during a visit to a distribution centre for medical supplies in Pennsylvania.
His order would “help bring vital factories, pharmaceutical producers, and most importantly, jobs back home, where they belong”, he added.
But the sheer complexity of some medical products means that the US cannot manufacture them all by itself, said Prof Gereffi.
For instance, N-95 masks require 70 different parts, only some of which are made in the US, while ventilators consist of around 300 components.
GLOBALISATION HERE TO STAY
I believe that domestic production in these medical devices and personal protective equipment is definitely going to increase in the next few years. But it’s not going to displace or replace globalisation per se.
PROFESSOR GARY GEREFFI, sociologist and director of Duke University’s Global Value Chains Centre.
PRIORITISE CRITICAL DRUGS
I don’t think the US has the option not to do it.
HASTINGS CENTRE SENIOR ADVISER ROSEMARY GIBSON, saying the US could identify the most critical medicines that are essential for the functioning of the healthcare system and gradually bring manufacturing of them back home.
“The US could focus on particular critical components, but realistically it can’t expect to bring the entire supply chain for all of these products inside the US,” he said.
“We still have to manage these efficiency problems through some kind of international arrangements, even if we could increase production for some critical products in the US in the short term.”
Even before the coronavirus struck, Washington had been increasingly concerned about the growing reliance of the US on foreign – particularly Chinese – pharmaceutical products.
Drug manufacturing has been shifting out of the US in recent decades to Asian countries like China and India, which have cheaper labour costs and less stringent environmental regulation.
As a result, only 28 per cent of the manufacturing facilities making the raw materials for medicines to supply the US market were in the country as of August last year, according to official testimony during a US-China Economic and Security Review Commission hearing on the issue last year.
“Use of foreign-sourced materials creates vulnerabilities in the US drug supply,” said Food and Drug Administration official Janet Woodcock, director of its Centre for Drug Evaluation and Research, at the hearing.
The US could identify the most critical medicines that are essential for the functioning of the healthcare system and gradually bring manufacturing of them back home, said New York-based Hastings Centre senior adviser Rosemary Gibson at the briefing.
She added: “I don’t think the US has the option not to do it.”