A new survey reveals significant weaknesses in European supply chain resilience. Many businesses across the continent remain strikingly unprepared for potential geopolitical disruptions. This lack of foresight appears despite clear warnings from current global events.
The Bertelsmann Stiftung recently conducted this comprehensive European Business Survey. It polled 228 companies operating throughout Europe. Alarmingly, 81% of respondents have felt or anticipate effects from Russia’s war in Ukraine.
However, very few companies have taken concrete steps for future shocks. For instance, only 10% prepared for a potential contingency involving Taiwan. Furthermore, 59% have made no such plans at all, according to the findings. Jacob Gunter, a study co-author, expressed his concern. He noted companies clearly understand geopolitical disruptions cause business pain.
This same vulnerability extends to China. Only 24% of businesses intend to lessen their reliance on Chinese suppliers. Moreover, approximately one-third are considering strategic stockpiles of critical raw materials. Mr. Gunter finds this lack of action “quite shocking.” He highlights the current trade and technology conflicts already expose these dependencies.
Meanwhile, US-China trade and tech restrictions already impact nearly one-third of all respondents. For companies operating directly in China, this figure jumps to around half. Brussels is now preparing a “diversification instrument.” This aims to reduce reliance on single suppliers and strengthen supply chains overall.
The EU faces a substantial daily goods trade deficit with China, estimated at €1 billion. Upcoming high-level meetings between US and Chinese leaders may address Chinese export controls. However, experts question the EU’s influence in these crucial discussions. EU Trade Commissioner Maroš Šefčovič will visit Beijing in October. Possible EU countermeasures might follow if talks fail.
Ultimately, improving European supply chain resilience remains a critical challenge. The findings underscore a disconnect between recognized risks and tangible corporate action. Therefore, proactive measures are urgently needed to mitigate future economic shocks.
