Over a third of U.K. importers (35%) said they have felt the impact of growing geopolitical tensions, particularly in China, forcing them to reexamine their supply chains, according to a recent survey.
Based on a report released by the Institute of Directors (IoD), entitled “Reorienting: The Impact of Geopolitics on Business Supply Chains,” one in five importers from outside the U.K. have had to change their supply chains due to geopolitical tensions while another 15% are considering supply chain alterations. An additional 6.6% of importers said they’re not sure if their supply chains have been influenced by geopolitical pressures.
Meanwhile, the growing tensions have had a greater impact on big businesses versus smaller organizations because 53% of large companies (250+ employees) said they have been forced to respond to these pressures compared to just 31% of SMEs (small and medium-sized enterprises).
Still, a majority of companies have been unscathed by these international affairs with 58.4% of importers saying their supply chains have been unaffected by recent geopolitical tensions.
“It is clear businesses are sensing geopolitical shaped clouds on the horizon, particularly whilst China’s standing with the U.S., Russia and Taiwan remains uncertain,” said Emma Rowland, trade policy advisor at the IoD. “Whilst it is broadly felt that a complete decoupling from China is economically impractical, at least for now, the fact that a significant number of businesses are willing to take on extra costs to secure their global operations shows attitudes to global trade are shifting.”
The IoD, a 120-year-old British political organization with over 20,000 members, received 1,026 responses for the survey from May 12 to May 28, 2023.
