World Bank has introduced its new Global Supply Chain Stress Index. The Index “is a measure of the container shipping capacity that is tied up when ports are congested or closed or when vessels must be rerouted. It is expressed in millions of 20-foot equivalent units (TEUs).” The motivation for developing this tool that measures economic impact from supply-chain disruptions stems from a number of factors. These include ramifications from the COVID 19 pandemic, terrorist attacks on shipping in the Red Sea, and the Panama Canal draught. More on the Index according to World Bank (mostly directly quoted):
- The Index is updated in the first half of each month and is made available as an Interactive dashboard.
- It uses data from the Automatic Identification System (AIS), which tracks the location of ships across the globe in real time.
- Only vessels of Panamax size or larger are included. Estimates are made at the port level and then aggregated at the country, regional, and global levels.
- It offers insights into the ways that disruptions affect firms and consumers, such as the connection between economic stress and the shipping rate (utilizing the Shanghai Containerized Freight Index).
- It differs from the Federal Reserve Bank of New York’s Supply Chain Pressure Index in that is based on ship-level data. The New York Fed’s index is a meta indicator. It aggregates other indicators such as the Baltic Exchange Dry Index of bulk freight rates and S&P Global’s Purchasing Managers Index.
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