Will Reinsurance Stabilize Trade Flows?

The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates.  

Both the United States and the European Union (EU) have been looking into novel ways to stabilize their supply chains amid the COVID-19 pandemic. Since their economies are highly dependent on international trade it makes sense to dig deeper into trade facilitation. The EU government has already put policies in place that stabilize the insurance side of the process. Currently, the U.S. is lagging at the stage of industry lobbying.

Transportation facilitates trade. But if it is too expensive for the consignor, then trade does not take place. Likewise, trade does not take place if importers at the manufacturer or wholesaler level feel that their retail customers downstream along the supply chain will not pay them. Many retailers are now building up stocks of fall merchandise. COVID-19 cannot

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