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19 February 2021

Productivity Commission review into Australia's supply chain stability

The Morrison Government has requested the Productivity Commission undertake an independent review into supply chain vulnerabilities and risks as part of it’s commitment to ensuring the Australian economy is prepared for possible supply chain disruptions.

Australia’s supply chains proved resilient in response to the COVID-19 pandemic, but the experience with COVID-19 has highlighted Australia’s potential vulnerability to global supply chain disruption.

The Productivity Commission will look at Australia’s supply chains, as well as longer term trends in relation to Australia’s linkages and dependencies with respect to international trade and assess whether vulnerabilities or opportunities exist.

The Productivity Commission will also examine the nature of the risks to the Australian economy as a result of global supply chain disruptions, identifying any significant vulnerabilities and possible approaches to managing them.

The Australian economy greatly benefits from the international trade facilitated by global supply chains, through the provision of critical goods and our specialisation in export markets and it is timely to assess our role in and exposure to global supply chains.

In 2019-20 the total value of Australian goods and services trade was $873.1 billion.

The Productivity Commission’s will undertake consultation, and provide a report on Australia’s role as an importer in March 2021 and a second and final report on Australia’s role as an exporter in May 2021.

The Productivity Commission study builds on a series of measures implemented by the Morrison Government to ensure Australia’s supply chains remain functioning and resilient including the announcement of a $107.2 million Supply Chain Resilience Initiative that businesses can access to support or establish a capability that addresses a supply chain vulnerability.

The review will be another important step by the Morrison Government to further secure the Australian economy, ensuring it is ready for the challenges and opportunities presented by the COVID-19 pandemic.

For further information, including terms of reference, please visit the Productivity Commission's website.