How a Three Gorges Dam collapse (or more flooding) could impact supply chains

Over the past several weeks, the Three Gorges Dam has been on our radar—a true marvel of human engineering and the largest hydroelectric dam globally. While it generates 2% of China's electricity, which is impressive, that’s not the primary reason we’ve been monitoring it closely. Recently, China has seen an unprecedented amount of rainfall, and despite the limited transparency regarding the dam’s status, concerns are growing about what these conditions might mean. If the dam were to fail, the consequences would be catastrophic. Within hours, countless lives would be lost, and the resulting flood would cause devastation across China. Internationally, this disaster would severely disrupt already strained global supply chains, affecting industries worldwide. This risk is something we need to keep an eye on and take seriously. Here’s what you should consider: - Food prices are already under pressure due to flooding, and these impacts will likely spread globally. - A dam failure would cripple key components of global supply chains, leading to widespread shortages. - Financial markets would experience significant turbulence following such an event. - Access to reliable information about the dam’s condition remains restricted, complicating assessments. - If you haven’t already, focus on preparing for ongoing supply chain disruptions and rising food costs—this situation intensifies the urgency. The Yangtze River basin plays a pivotal role in the global economy. If considered a standalone nation, its economy would rank among the top three globally. Nearly a third of the world’s manufactured goods come from China, with over half produced in the Yangtze River Economic Zone. A breach at the Three Gorges Dam could halt approximately 15% of global manufacturing within 24 hours. In essence, the Yangtze River basin is vital to the world's economic health. It serves as a hub for industries like Apple, Walmart, and Nike, all of which have faced supply chain challenges due to recent events. Wuhan, the epicenter of the early coronavirus outbreak, is also located within this region. Understanding the Yangtze River's significance involves recognizing how its upper, middle, and lower reaches each function as robust industrial powerhouses. Each section carries unique economic and strategic importance. For instance, the upstream areas are rich in natural resources, while downstream regions host advanced manufacturing hubs. This intricate network supports both domestic and international trade, making any disruption particularly impactful. As we continue to follow developments, staying informed and prepared remains crucial. Whether through stockpiling essentials or diversifying supply sources, proactive measures can mitigate potential fallout.

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