AI Magazine Issue 2 2017

Acquisition International - February 2017 7 Businesses Must Prepare for aWorld Trumped for Trade Businesses with extensive supply chains should therefore take action to insulate themselves against the potential penalties and strident regulation that they could become subject to, according to Nick Miller, head of FMCG at supply chain and business transformation consultancy, Crimson & CO. At his inauguration, President Trump outlined his intention to pursue an ‘America First’ policy, stating that ‘We will follow two simple rules: Buy American and hire American.’ The first manifestation of this policy was Trump’s definitive decision not to join the TPP – a flagship Obama trade deal encompassing 11 countries in the Pacific rim which, with American membership, would have been responsible for 40% of the world’s trade. The US is currently in the top three global importers and exporter, making it a major driver for global trade. Coinciding with Brexit, which the Prime Minister recently revealed will see Britain lose access to the single market, and a surge of anti-globalisation and anti-free trade sentiment across much of the Western World, Trump’s declarations look likely to augur a period where the various initiatives towards free trade will stutter and grind to a halt and potentially reversing into protectionism. Nick Miller commented on these events, “the march towards free trade has always been somewhat precarious, with cycles of protectionism generally coinciding with lower economic growth and sometimes with recessions. For example, in the midst of the recession in 2009, the World Trade Organisation reported “significant slippage” in adherence to its free trade principles. However, Trump’s statements and actions so far, as well as Brexit, represent a threat to free trade that is an order of magnitude higher than anything we’ve encountered in recent years. “At a time when ‘Made in the World’ is the norm, this undoubtedly could cause problems for many businesses. Global business loves free trade for many reasons – one is that it allows them to find the most effective and lowest cost supplier for goods. It also allows them to move people around the business on a global scale as they require. These two factors are now endangered. Any restrictions will lead to higher costs of production – and therefore often higher prices, lower sales, and reduced growth.” There are steps businesses can take to help protect themselves against these alarming shifts. Nick Miller outlined a few, “businesses have to be dynamic and fast-moving to help alleviate the potential costs of these restrictions. Many will have complex supply chains, criss-crossing networks extending across the world, and will therefore need to apply some analytical rigour to the task. “One of the steps they can take is do more ‘nearshoring.’ This means sourcing and manufacturing closer to end markets, therefore reducing the expansiveness of the supply chain and vulnerability to anti-free trade measures such as tariffs. As a matter of good practise, organisations should at minimum carry out final packaging and any product customisation close to their end markets. “Moreover, organisations should look for contingencies in differential tax rules in order to reduce the tax burden, as these will not necessarily be affected by any agreements around the transferring of physical goods. Moreover, any kind of trade war or intensifying of trade competition between countries could create opportunities as countries look to compete by differentiating their tax rates.” Nick Miller concluded his thoughts, saying that “geopolitical developments can have dramatic effects on the business community, and organisations should be alert to these possibilities. There are ways to insulate yourself from damage and even to prosper in times of change, if you are prepared to unravel the complex implications of these changes and take the right actions decisively and rapidly.” For more information, please see: www. crimsonandco.com . President Donald Trump’s protectionist rhetoric at his Presidential inauguration and his subsequent withdrawal from the Trans-Pacific Partnership (TPP) could herald a period where the progress of free trade might well grind to a halt. Leading security vendor Becrypt on 8th February announced its support of the National Cyber Security Centre (NCSC)’s new CyberFirst programme, which aims to improve the UK’s cyber industry by creating opportunities for talented young people to enter the field. The scheme aims to create a positive image of the cyber security industry, encouraging students ranging from secondary school to university to begin their journey to becoming the nation’s next generation of security experts. As a member of the programme, Becrypt will be providing financial support, training and work experience opportunities for students, supporting them through to their degree and first job in the field. Becrypt will also be helping to support some of the 2,500 residential courses NCSC is running for 14-18-year-olds across the country. Bernard Parsons, Co-founder and CEO of Becrypt commented, “it is vital for our national security and economic prosperity that we adequately invest inappropriate cyber skills. I believe the security industry has a duty to help cultivate our home-grown talent into the world- leading workforce of tomorrow, creating future industry leaders and innovators, and we are proud to do our part with the CyberFirst scheme. “As well as nurturing young minds, the government and industry must also work together to help graduates translate their research and pioneering ideas into successful businesses that will continue our proud history of innovation.” Chris Ensor, Deputy Director for NCSC skills and growth said, “this is the first-time government and industry have come together to make a concerted attempt to inspire and support a whole generation of young people to take up a role in cyber security. “Cyber security is a fascinating career choice which is fundamental to our modern digital society and we are delighted our industry colleagues are supporting CyberFirst.” NCSC’s NewCyberflirts Programme to Boost National Security Skills NEWS / From Around The World