Month: March 2024

Event recording: AI and trade: Will ChatGPT handle your supply chains? (March 2024)

Panel

  • Cecilia Malmström, Nonresident Senior Fellow, Peterson Institute for International Economics (PIIE)
  • Eva Maydell, Member, European Parliament; Rapporteur for the European Union’s AI Act
  • Joshua P. Meltzer, Senior Fellow, Global Economy and Development Program, Brookings Institution

Key points

  • AI has the potential to optimize supply chains, analyze shipping routes, forecast demand, and enhance risk assessment and fraud detection.
  • AI could potentially offer better market intelligence to help businesses make better-informed decisions and improve forecasting accuracy.
  • AI could reduce barriers to trade in services and technical barriers of trade (TBT) and empower small and medium-sized enterprises (e.g., translation services)
  • While trade in goods has peaked, services trade continues to grow substantially, even during COVID-19, with digital services and professional services being the main drivers. AI could further facilitate the expansion of service trade.
  • AI is already affecting the nature of jobs and the services trade.
  • Policymakers need to focus on creating an environment that supports the development and deployment of AI, particularly by balancing the need to provide regulatory guardrails and the need to encourage business innovation.
  • AI regulation is currently fragmented worldwide. However, there is significant potential for establishing international standards and regulatory coherence, offering a common approach to regulating AI.
  • Building more societal trust among the business community, policymakers, and civil society is necessary to address concerns about AI and related challenges.

[This blog post is not open for comment]

US Fashion Companies’ Evolving Sourcing Strategies and the Future of the US Textile and Apparel Industry: Discussion Questions from FASH455

Students in FASH455 have proposed the following discussion questions based on the readings about the US textile and apparel industry and fashion companies’ sourcing strategies. Everyone is welcome to join the online discussion. For FASH455 students, please address at least two questions and mention the question number (#) in your reply.

#1 As a developed country, should the US prioritize further strengthening highly capital-intensive yarn manufacturing, or should we rebuild a vertically integrated textiles and apparel supply chain (e.g., yarns, fabrics, and garments) at home? What is your recommendation, and why?

#2 In FASH455, we discussed how the US textile industry has experienced a decline in employment despite increasing production volumes, largely due to advancements in technology. However, why is import competition often cited in the media as the single largest threat to the US textile industry?

#3 While studies show that US fashion companies are reducing “China exposure,” measured in quantity, China still accounted for 36.1% of US apparel imports in 2023, even higher than 34.7% in 2022. How can we explain this phenomenon? What factors have made US fashion companies hesitant to move away from China?

#4 How will US fashion companies’ growing interest in carrying more sustainable textiles and apparel affect their sourcing destinations and supply chains? Will developing countries with cheap labor and/or developed countries with the right capital and technology be the winners in the sustainability movement? Please provide your thoughts.

#5 Will the growing demand for supply chain transparency and traceability reduce the incentives or add additional burdens for fashion companies to diversify their supply chain further? What are the benefits of pursuing sourcing diversification other than mitigating the potential sourcing risks?

#6 What is your vision for the use of AI in apparel sourcing? What key sourcing and supply chain problems facing fashion brands and retailers can AI potentially solve?