The European Commission proposes new powers to allow Brussels to ensure supplies during a crisis by next year.
On some fronts, Europe’s supply chains have been exposed to significant vulnerabilities in the last year. In the coronavirus vaccination race, the EU was caught off guard and had to take tough measures to limit exports and retain vaccines within the bloc.
The situation has merely added to concerns about Asia’s reliance on crucial imports ranging from face masks to microchips.
The European Union, in particular, is concerned because China supplies 98% of the rare earth metals it requires for a variety of industrial applications.
Meanwhile, a magnesium shortage in China has become a massive concern for automobile, airline and electronics manufacturers.
Internal Market Commissioner Thierry Breton stated the new law would be presented in the “spring” during a New Year’s address to his staff.
According to Breton, the regulation will include a “toolbox of measures that can be activated to safeguard supply security during a crisis,” which might consist of export bans and the EU’s ability to collect information from corporations on production stocks and supply networks.
“Mid-to-long-term initiatives, to resolve structural, strategic dependencies, diversify supply sources and expand EU industrial capacities” would also be included. Officials claim that this will consist of steps to reduce the EU’s reliance on China.
Earlier this year, European Commission President Ursula von der Leyen hinted at the new law, saying that Brussels was “working on a Single Market Emergency Instrument.”
It is to “ensure the free movement of goods, services and people with greater transparency and coordination and fast-track decisions, whenever a critical decision arises.”