The global economy has faced disruptions from events like the COVID-19 pandemic, highlighting vulnerabilities in global value chains. This new article, published by our researchers from Universidad de Castilla-La Mancha (Luis A. López, Mateo Ortiz, Ángela García-Alaminos, and María Ángeles Cadarso) in the Journal of International Business Policy, examines the environmental impacts of reshoring strategies in the European Union. The analysis draws on an environmentally extended multiregional input-output model to assess how reshoring affects carbon dioxide emissions across various sectors

The research focuses on five strategic products: antibiotics, vaccines, iron and steel, chips and circuits, and electrical motors and batteries. By simulating different reshoring scenarios, the authors evaluate the potential for reducing the European Union's carbon footprint. The results indicate that reshoring can lead to significant reductions in carbon emissions, particularly in the iron and steel sector. They also highlight the importance of selecting new suppliers with lower carbon intensities to achieve environmental benefits.

The article concludes that reshoring can enhance the resilience of global value chains while contributing to climate goals. Future work could explore the role of multinational enterprises in reshoring and the potential economic impacts on developing countries. The findings suggest that integrating environmental considerations into trade policies can support both resilience and sustainability objectives. 

Read the full article here.