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FM World on six elements impacting provide chain disaster

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“Although the pandemic created problems in the supply chain, the proliferation of chip-based products and the intensification of demand are also contributing, which are not going away,” said FM Global.

The insurer identified cyber risk as another factor affecting corporate resilience as the pandemic forced companies to go digital. It stated that since the pandemic started last year, cybercrime has become a big business and geopolitical hotspot, making cybersecurity an integral part of business strategy.

Other factors are:

FM Global pointed to the Goldman Sachs estimate that $ 24 billion worth of goods lingered outside the California ports alone because ocean-going goods have accumulated faster than workers can move them.

FM Global announced that there is a lack of truck drivers in many countries to move the goods that are behind schedule in ports and elsewhere. For example, according to the International Road Transport Union, in its most recent review, 20% of driver jobs in road transport in Eurasia were vacant. Meanwhile, the American Trucking Associations estimated that 80,000 truck driver jobs were vacant.

“While no single weather event can be conclusively attributed to a changing climate, flooding is a well-documented effect of rising temperatures and a growing risk for businesses,” said FM Global.

The insurer said the pandemic closed factories and sparked a surge in technology demand that affected auto, games, smartphone and medical device manufacturing among many other industries, possibly through 2023 or beyond.

Doug Backes, Vice President and Manager, Staff Claims, at FM Global, commented on the report: “The FM Global Resilience Index 2021 is designed to help companies optimize their supply chains in good times and bad by providing valuable data on relative resilience of the business environment of countries and territories. “

Eric Jones, vice president and global manager of business risk consulting at FM Global, said in a previous statement that resilience and property-related risk are typically a blind spot in making important business decisions.

“The Index is a great way to shed light on this, to get people to think about the risks associated with where you do or want to do business around the world. And it’s not just your own in-house facilities and people and where they are, but anywhere in the world where you have business dependencies, especially within the supply chain, logistics and even your customers, ”added Jones.

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