The Bank for International Settlements (BIS) is set to launch Project Insight, an initiative aimed at enhancing the monitoring of global value chains (GVCs) through advanced data analysis.
This project seeks to address existing data gaps and improve policymakers’ ability to track trends and shifts within GVCs.
Global production and trade, segmented into GVCs, have become standard practice. However, there are notable deficiencies in data and analysis that impede effective monitoring of these chains.
Recent disruptions, such as those caused by the Covid-19 pandemic, have highlighted the limited understanding of firm-level GVC relationships and their broader economic impacts.
These disruptions have led to supply chain bottlenecks, altered supplier relationships, and contributed to rising inflation globally.
Efforts to restructure supply chains through reshoring and near-shoring further underscore the need for improved monitoring tools.
Understanding GVC dependencies is crucial for central banks and policymakers, as these chains are closely linked to key objectives like price stability and economic growth.
Supply chains are increasingly becoming a focal point in the considerations of central banks and regulatory authorities worldwide.
Project Insight aims to create a comprehensive GVC monitor to assist central banks, policymakers, and international organizations in assessing critical developments and their economic and financial impacts.
The project will collaborate with the private sector to integrate extensive structured and unstructured data relevant to GVCs.
It will also leverage big data analytics tools, including artificial intelligence, machine learning, and network analysis, to derive meaningful insights.
This initiative involves collaboration between the BIS Innovation Hub’s Hong Kong Centre, the BIS Monetary and Economic Department, the Hong Kong Monetary Authority, the International Monetary Fund, the World Trade Organization, the Asian Development Bank, the Organisation for Economic Co-operation and Development, the United Nations, and DIW Berlin.
Featured image credit: Edited from Freepik
