- November 16, 2023
- Elisabeth Braw
Finland and Sweden have woken up to the fact that, in a fragmented, destabilised world, countries need to adopt measures to guarantee ‘security of supply’. Their allies should do so too.
For centuries, security of supply was a concern for kings, regimes and governments. The need to secure a constant stream of supplies prompted them to invade and occupy other countries and territories. Then came three post-Cold War decades, but now Sweden has decided to investigate its security of supply. Other countries should, too, because supply disruptions can wreak havoc on industrialised economies.
‘One of the pillars of resilient civil defence is robust security of supply. We can’t assume that the global trade flows on which it ordinarily relies will continue to function in a serious crisis or, in the worst case, war.’ That was the key message in an op-ed by Ebba Bush, Sweden’s Deputy Prime Minister and Minister for Energy, Business and Industry, and Civil Defence Minister Carl-Oskar Bohlin in the Swedish business daily Dagens Industri on 12 November. The two ministers announced that they have asked the Swedish Civil Contingencies Agency (MSB) and the Swedish Agency for Economic and Regional Growth (Tillväxtverket) to create ‘a model for comprehensive information to businesses that can support switches in production for essential goods and services’.
Sweden, in other words, needs to be able to become self-sufficient in case of serious disruptions to global supply chains – or war. What happens when global supply chains are disrupted became clear during the first weeks of Covid-19, when lots of countries needed PPE and China, which had become the global hub for PPE manufacturing, wasn’t able or willing to deliver the supplies needed. European countries claimed their limited domestically produced PPE for themselves, jettisoned solidarity with one another and scrambled to incentivise manufacturing firms to switch to PPE.
The world will face another pandemic; the question is simply when. It will also face disruptions caused entirely by other countries. The Ukraine war is already affecting the supply of global grain, while the Israel-Gaza conflict could harm global oil supplies. China, which remains the world’s manufacturing superpower (remember that countless components for products are made there, too) could decide to suspend deliveries or manufacture a production or logistics malfunction. Mother Nature could also cause disruptions to global supply chains, especially since the world’s countries have failed to halt climate change. More and more extreme-weather events are on the cards.
When that happens, industrialised countries can no longer assume that the goods and services that are ordinarily produced for them in other countries will be available. Nor can they assume that their neighbours will be able to help, because they are also likely to be facing the same disruptions. That has made security of supply a top priority once again.
Tomorrow’s security of supply – at least in the Western world – won’t be the kind practised generations ago, which saw armies occupy other countries’ land to secure supplies for the population at home. The 21st-century version is more reminiscent of the Cold War kind, which saw countries work closely with manufacturing companies to secure wartime essentials and operate enormous strategic reserves of everything from coffee to petrol. Sweden’s Cold War strategic reserves were second to none; one site near my childhood home stored 330 tonnes of coffee, which was replaced every six months to keep the reserves fresh, and the outgoing reserves were sold to cafés and supermarkets around the country. Then, however, most other Western countries did away with the vast majority of its strategic reserves, though petrol reserves usually remained.
Finland never jettisoned its strategic reserves, which are maintained by the National Emergency Supply Agency, Huoltovarmuuskeskus. When Covid hit, the country didn’t have to desperately scramble in the manner of its European neighbours: it opened its strategic reserves. What Huoltovarmuuskeskus found were supplies that were often not in the best shape but, if nothing else, Covid reminded the Finns of the importance of managing strategic reserves, not just having them.
Which supplies does an industrialised country need always to have available? Those goods and services are not identical to the ones needed during the Cold War, but what, exactly, is needed is uncertain. Not every item needs to be stored in strategic reserves. Some items can be stored in one country for the benefit of one or two neighbours as well, and those countries can, in turn, store certain other items. Other goods and services, meanwhile, can be produced by domestic companies that can switch from one type of operation to another during a crisis. All of this needs to be mapped out, planned and exercised.
It’s not just Sweden that needs to conduct a complete inventory of its supply needs and create a new security-of-supply model: every industrialised country needs to do so. The model that the MSB and Tillväxtverket have been asked to create is due at the end of next year. If Sweden’s allies haven’t created their own models by then, they could simply adapt the Swedish one. It’s good to have allies.