Bill Overview
Title: Western Hemisphere Nearshoring Act
Description: This bill provides assistance for corporations to move operations from China to countries in Latin America or the Caribbean and addresses related issues. For example, the bill requires the U.S. International Development Finance Corporation to provide financing and other assistance to eligible corporations for costs associated with such a move. Tariffs collected for goods manufactured in China shall be used to pay for such assistance. The President may provide preferential treatment, including duty-free treatment, for goods produced in a Latin American or Caribbean country by a corporation that received relocation assistance under this bill.
Sponsors: Rep. Green, Mark E. [R-TN-7]
Target Audience
Population: People/Individuals globally involved in manufacturing, logistics, and related sectors affected by corporate relocation from China to Latin America or the Caribbean
Estimated Size: 200000000
- The bill specifically impacts corporations currently operating in China that may relocate to Latin America or the Caribbean.
- It affects workers in the corporations that choose to relocate, as their operations may shift geographically.
- Latin American and Caribbean countries' workforces could be positively impacted by new job opportunities due to corporate relocations.
- There will be an impact on supply chains that connect China with U.S. markets as manufacturing may shift closer to the US.
- The U.S. workforce involved in logistics, distribution, and related services might be affected by changes in supply chain dynamics.
- Consumers could be impacted by potential changes in product availability and pricing due to shifts in manufacturing locations.
- The bill could influence U.S. corporate investment strategies based on new incentives to relocate operations out of China.
Reasoning
- The policy is primarily aimed at encouraging U.S. corporations to move manufacturing operations from China to Latin America or the Caribbean, which will directly affect these corporations and their employees.
- For most U.S. individuals, the policy will have indirect effects, such as potential changes in product prices, availability, and shifts in job opportunities related to logistics and distribution.
- The budget limits imply that not every corporation or individual will see dramatic changes immediately or uniformly across the board.
- The scale of the impact will vary. Business leaders and employees in targeted sectors will experience the most significant effects, whereas others, such as consumers, might experience minor changes over time.
- Logistics workers might see substantial workload changes due to alteration in supply chains, while certain manufacturing jobs could be affected positively or negatively, depending on sector-specific shifts.
- It's important to include various perspectives, including consumers, manufacturing and logistics workers, and those not directly affected to get a balanced view of the impact.
Simulated Interviews
Auto Industry Executive (Detroit, MI)
Age: 45 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 5/20
Statement of Opinion:
- I think the Act will help reduce dependency on Chinese manufacturing, which has strategic benefits.
- Relocating to Latin America could streamline our supply chain and reduce costs in the long run.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 8 | 7 |
| Year 3 | 8 | 6 |
| Year 5 | 9 | 5 |
| Year 10 | 9 | 5 |
| Year 20 | 9 | 4 |
Logistics Coordinator (Houston, TX)
Age: 34 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- If our company shifts suppliers to Latin America, it could mean more job stability for me.
- I'm concerned about possible inefficiencies during the transition period.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 5 |
Retail Assistant Manager (Miami, FL)
Age: 29 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 3.0 years
Commonness: 7/20
Statement of Opinion:
- Our products might become more affordable if manufacturing moves closer, which would be great for business.
- I'm worried about the unpredictability of transition periods. Could cause supply chain hiccups.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Finance Analyst (New York, NY)
Age: 52 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 5.0 years
Commonness: 6/20
Statement of Opinion:
- This seems like a smart geopolitical move and could be a nice boost for our investments in Latin America.
- There's always risk in such policy moves, but the rewards could outweigh it.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 9 | 8 |
| Year 10 | 9 | 8 |
| Year 20 | 9 | 8 |
Consultant (Los Angeles, CA)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 4.0 years
Commonness: 4/20
Statement of Opinion:
- The shift of manufacturing could mean less travel to Asia and more to Latin America, something that I would personally welcome.
- However, some clients might face uncertainty during the transition, which could temporarily increase my workload.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 6 |
Retired Logistics Manager (Dallas, TX)
Age: 60 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 12/20
Statement of Opinion:
- Nearshoring will bring some predictability and potentially reduce shipping times and costs.
- Retired, but interested to see how these changes will play out in the logistics industry.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 7 | 8 |
Warehouse Supervisor (Chicago, IL)
Age: 38 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 6.0 years
Commonness: 11/20
Statement of Opinion:
- Potential reshoring of segments of our supply chain could lead to more jobs and workload here.
- It might affect the cost structures negatively if not managed well, but overall, I see it as a positive move.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 8 | 6 |
| Year 10 | 8 | 6 |
| Year 20 | 8 | 5 |
Software Engineer (Seattle, WA)
Age: 47 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 15/20
Statement of Opinion:
- This might increase demand for automation technology in new Latin American facilities, which is exciting.
- I am not directly affected immediately but see potential future projects.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 8 | 7 |
| Year 5 | 8 | 7 |
| Year 10 | 8 | 7 |
| Year 20 | 8 | 7 |
Consumer Advocate (Phoenix, AZ)
Age: 62 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 4.0 years
Commonness: 8/20
Statement of Opinion:
- Moving production closer can help in ensuring better quality control for consumer products.
- There's always a concern over standards adherence during transitions, which needs oversight.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 7 | 6 |
Entrepreneur (San Francisco, CA)
Age: 28 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 9/20
Statement of Opinion:
- Sourcing goods from Latin America instead of China can cut down on carbon emissions which aligns with our company values.
- There's concern about supply chain stability during the shift.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 6 | 5 |
Cost Estimates
Year 1: $2000000000 (Low: $1500000000, High: $2500000000)
Year 2: $2100000000 (Low: $1600000000, High: $2600000000)
Year 3: $2200000000 (Low: $1700000000, High: $2700000000)
Year 5: $2400000000 (Low: $1800000000, High: $2900000000)
Year 10: $2500000000 (Low: $1900000000, High: $3000000000)
Year 100: $3000000000 (Low: $2000000000, High: $3500000000)
Key Considerations
- The reallocation of tariffs as a funding mechanism might reduce other potential uses for these funds.
- Initial fixed costs and transition times could delay cost effectiveness.
- Potential regional geopolitical impacts could influence implementation or compliance costs.