Masks and gold bars on U.S. dollar bill banknotes. /Getty
Editor's note: Djoomart Otorbaev is the former prime minister of the Kyrgyz Republic, a distinguished professor of the Belt and Road School of Beijing Normal University and a member of Nizami Ganjavi International Center. The article reflects the author's views and not necessarily those of CGTN.
On August 3, U.S. mask manufacturers warned that they would soon go bankrupt without direct government support, which would lead to the abandonment of the production of masks in the domestic market amid another rise in the number of cases of COVID-19.
Private companies, state and local governments favor Chinese masks, which cost only a fraction of the cost of locally made masks. The lack of demand has already forced U.S. mask makers to lay off more than 5,000 employees, and executives say the industry will not survive the next year without government backing.
"With the virus getting worse, and we're not even into the cold months, we're really worried that this industry won't be here to help when it's needed most," said Brent Dillie, chairman of the recently formed American Mask Manufacturer's Association (AMMA). The industry has hired Washington lobbyists to defend its interests.
In the second quarter of 2021, the AMMA paid out $100,000 to LSN Partners, a consulting firm, to lobby Congress, the United States Agency for International Development (USAID), the Pentagon and the Mask Procurement Management and Budget Office.
For almost all countries, the shortage of personal protective equipment (PPE) at the beginning of 2020 was a real shock. The early needs of PPE led to the imposition of export controls, controls on domestically produced equipment, and other emergency policies, including attempts by the U.S. to reserve shipments made elsewhere by U.S. headquartered multinationals. In this sprint race, Chinese producers showed the best result.
By April 2020, i.e., only in two months after the COVID-19 outbreak, China not only met its colossal domestic demand for PPE but also resumed both active exports and large-scale humanitarian support measures.
Surprisingly China's competitors still cannot recover from their inabilities to adapt to new realities. Western institutions, as usual, declared China to be the source of all problems. In February 2021, and shortly after taking office, U.S. President Joe Biden issued an executive order, saying, "This will never happen again in the United States, period. We shouldn't have to rely on a foreign country – especially one that doesn't share our interests or our values – to protect and provide for our people during a national emergency."
According to a report just released by the Peterson Institute for International Economics (PIIE), China nearly quadrupled its exports of PPE from $22.9 billion in 2019 to $88.1 billion in 2020, with the exports of medical masks and respirators surging by $48.8 billion to $53.8 billion in 2020, face shields increasing by $3.5 billion to $16.8 billion, protective clothing by $9.9 billion to $10.8 billion, and gloves by $2.9 billion to $3.9 billion.
Besides, exports of Chinese PPE to the U.S. rose from $7.1 billion to $24.6 billion in 2020. The corresponding exports to the EU increased from $3.9 billion to $23.4 billion.
"The trade data show no indication that changes in quality control of goods from China or tensions in China-U.S. relations has impacted Chinese exports of personal protective equipment," the PIIE stated in the report.
The significant increase in the production of Chinese PPE did not stop the sharp rise in their prices over the last year. Specifically, the export price for one mask or respirator in April 2020 was up 720.8 percent compared to December 2019. The price for a set of protective clothing increased by 536.2 percent, according to the PIIE. "Even a significant increase in [Chinese] exports is not enough to meet the explosive growth in global demand," the experts noted.
Empty hygiene shelves at Walmart during the Black Friday in New Jersey, U.S., November 27, 2020. /Getty
Analysts now argue that "Americans shot themselves in the foot" when the Trump administration imposed increased tariffs on imports from China. "In the four months since the new tariffs were introduced [for China] in September 2019, purchases in China of four out of five basic personal protective equipment have declined," experts at the PIIE state.
Considering the rise in prices caused by the new tariffs, many U.S. companies decided to sever ties with Chinese suppliers of PPE components. Afterwards, when the need arose to re-purchase their products during the pandemic, it was challenging for the companies to restore the lost connections.
In the spring of 2020, the depletion of PPE stocks in the U.S. was also reported by Reuters, which quoted Lizzie Litzow, a spokeswoman for the U.S. Federal Emergency Management Agency, as saying that the reserves would not be enough to cover all the needs of the states and noted that the government was making every effort to find suppliers.
What conclusions should we all draw from these lessons? Perhaps the world community should create a new structure to ensure effective international policy coordination, which is necessary at the first sign of the following emergency. Such an organization should develop suitable emergency measures for the urgent production of PPE to prevent a recurrence of the 2020 panic. Too long a wait, accompanied by harsh export restrictions, could lead many countries to catastrophic consequences that would claim millions of lives worldwide.
The analysis presented here focuses on large countries capable of developing and supporting domestic PPE industries. For smaller countries with limited resources, the problem of supplying PPE is even more acute. For them, creating a new international framework for responding to future public health emergencies is even more critical.
(If you want to contribute and have specific expertise, please contact us at opinions@cgtn.com.)