European Migration Crisis Costs Eclipse $1 Billion in Supply Chain Disruption

Supply Chain Security 4

A recent study reveals that essential shipments of retail goods and medical supplies are being delayed and destroyed as a result of the European migration crisis, with the consequential supply chain disruption costing a collective $1 billion to the economy in the United Kingdom in the last year alone.

The latest BSI (British Standards Institution) Supply Chain Security Risk Index shows that in September Europe saw the highest number of border closures in the last twenty years. With the number of families and individuals displaced by war across Africa and the Middle East growing by 50% over the past year, BSI warns that costs to international shippers will continue to rise.

The report highlights that closures at Calais add an estimated $1.2M each day to the cost of those transporting retail goods to the UK with delays of nine hours or longer, while border closures in Southern Germany, Serbia, Croatia and Hungary have hit retailers and shipping firms hard. This type of supply chain disruption increases risks of theft, spoilage, product damage, and other losses. Food and pharmaceutical shipments are worst affected, underscored by a recent incident in which an entire shipment of medical supplies worth $3.9 million having to be destroyed after stowaways broke into the container.

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Calais is a town and major ferry port in northern France. Since the middle ages it has been a very important center for transport and trading with England. The migrants, who are living in camps known as “the Jungle” on the edge of Calais, attempt to stow away on trucks headed for Eurotunnel, or jump or cut security fences to try to hide on Eurotunnel trains themselves. They also try to board trucks bound for cross-Channel ferries. Extra security, including fencing, paid for by the UK, has been put in place.

Attempts by migrants to cross the Channel from France into England have resulted in a logistical crisis, causing delays in transportation, rising security concerns and supply chain disruption. In one recent incursion, 100 migrants broke through a fence and entered the Eurotunnel terminal, with some making it into the tunnel itself. More than a dozen migrants have lost their lives trying to reach the UK since late June.

Jim Yarbrough, a global intelligence program manager of supply chain solutions at BSI, commented: “More so than any other economic bloc, Europe relies upon free trade. Every shipment delayed, contaminated or destroyed, raises the cost to the end consumer. For exports, this hurts competitiveness, undermines productivity and risks jobs; for imports, it raises the cost of living for each and every citizen.”

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