White House Unveils More Steps to Strengthen U.S. Supply Chains, Including Improvements to Transporation Infrastructure

Washington, DC (Reuters) — The White House today (Feb. 24) announced 10 new steps as part of its year-long drive to strengthen U.S. supply chains against climate shocks and geopolitical tensions, ensuring that China or others cannot weaponize supply chains against the United States.

Senior administration officials said the United States had made good progress since President Joe Biden signed an executive order one year ago that kicked off efforts to bolster domestic production of semiconductor chips, batteries for electric vehicles, rare earth minerals, and pharmaceuticals.

But they said more work was needed to address lingering supply chain challenges and strengthen the domestic industrial base — a process they said would yield some short-term gains but was also focused on longer-term structural changes.

Biden has been personally focused on rebuilding U.S. supply chains after acute supply shortages at the start of the COVID-19 pandemic squeezed the availability of masks, gloves, and other personal protective equipment, and a dearth of semiconductors jacked up the cost of cars and sent inflation to 40-year highs.

While the push is aimed at yanking back from China the production of technology and other goods once dominated by the United States, it is also meant to make U.S. supply chains more resilient to climate change and other disruptions, natural or manmade, one of the officials said.

Seven Cabinet agencies were due to publish six reports mapping out plans to address weaknesses in some of the nation's most crucial supply chains, including transportation, health care, defense and food, the White House said.

One common thread is the need to help small and medium-sized businesses compete and break up the domination by a few large corporations of businesses including meatpacking and distribution, the White House said.

Key steps planned include:

• Opening a $450 million Department of Transportation (DOT) program to pay for improvements at U.S. ports, and funding for other transportation infrastructure projects under the bipartisan infrastructure law.

• An Export-Import Bank initiative to boost financing for domestic production of semiconductors, biotech and biomedical products, renewable energy, and energy storage.

• Expanding access to capital for small manufacturers through new and existing programs at the Department of the Treasury and the Small Business Administration, including $10 billion in American Rescue Plan funds.

• A new "Buy American" rule due out in coming weeks that will offer enhanced price preferences and raise the domestic content threshold for a new category of critical products.

• Use of the Defense Production Act to build and expand the health resources industrial base and reduce the current "critical dependence" on imports for key pharmaceutical products and active pharmaceutical ingredients.

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