Why COVID-19 Will Not Lead to Major Restructuring of Global Value Chains

[...]although many governments are developing ambitious plans to increase autonomy, the reality is that they have limited leverage, as it is private companies, not governments, who decide the structure of most GVCs. [...]the arguments for such intervention are far from overpowering. [2] For all of these reasons, concerns about securing supply chain resilience in light of the weaknesses which COVID exposed will likely result in focused action in a limited number of priority sectors and, given the restrictions on government support, this is unlikely to result in major GVC reorientations. Sectors which were already seeking to shorten supply chains for a variety of business reasons – e.g., rising costs in emerging markets, new sustainability requirements, and the availability of the type of new technologies encapsulated in Industry 4.0.