The Biden administration has completed its 100-day review of four critical supply chains and is recommending remedies for supply chain deficiencies through the use of the Defense Production Act and a host of other measures.
President Joe Biden’s review, launched via executive order in February, specifically focused on semiconductors, large batteries, rare earth metals, and pharmaceutical ingredients.
BIDEN ORDERS SUPPLY CHAIN REVIEW FOR BATTERIES, SEMICONDUCTORS, EARTH MINERALS, & PHARMACEUTICALS
Senior administration officials told reporters Monday evening that while each of the aforementioned areas will receive its own set of unique recommendations, the overarching theme is simple: The United States must invest in domestic production, research, and development while working in partnership with allies to reduce the international community’s collective supply chain reliance on single nations, specifically China.
The officials notably discussed how the coronavirus pandemic shed new light on leveraging the Defense Production Act in a “thoughtful” and “judicious” manner and said to expect additional supply chain announcements to be made in the coming weeks and months. Officials also stated Biden will address supply chain concerns with foreign leaders at the upcoming G-7 summit.
The recommendations themselves list several steps the U.S. should take to achieve “long-term” supply chain “resilience,” including but not limited to:
- Dedicating “at least $50 billion in investments” for domestic semiconductor manufacturing and R&D
- Funding incentives for both consumer and commercial transitions to electric vehicles and the domestic development of advanced vehicle battery cells
- Deploying the DPA to “expand production capacity in critical industries” and forming a DPA Action Group
- Investing in the development of new pharmaceutical manufacturing processes
- Creating quality jobs — “with a free and fair choice to join a union, through sector-based community college partnerships, apprenticeships and on-the-job training” — that support supply chain goals
- Developing green standards for earth minerals processing at home and abroad and identifying new, sustainable mining sites within the U.S.
- Developing a “comprehensive” strategy that incorporates supply chain resiliency into the country’s trade policies with China
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The recommendations also direct the Departments of Commerce, Defense, Energy, and Interior to form working groups, continue studying supply chain resiliency, and provide new recommendations as they arise.
