Political and Economic Challenges in the Middle East: How Supplier-Buyer Dynamics Impact Supply Chain Resilience.
By Dr. Muath Maqool Al-Bhirat/ Assistant Professor, College of Business/ Amman Arab University
The critical factor in determining the sustainability of supply chains, particularly in regions like the Middle East with frequently unstable political and economic conditions, is the relationship between suppliers and buyers. Supply chains rely mostly on reliable and collaborative partnerships for efficient transportation of goods and services between locations. These relationships are particularly crucial in volatile areas as disturbances can significantly increase dangers and costs. It is easier said than done to reduce risks in an unpredictable environment through strong, open, and flexible relationships between buyers and suppliers. Military conflicts, political instability, and frequent policy shifts greatly impede supply chains in the Middle East. These circumstances could lead to blockades, delays in transportation, and disruptions in industry. The important factor in solving these problems in this environment is the connection between customers and vendors. Collaborating to anticipate risks and develop alternative plans can significantly improve the continuity of the supply chain. While customers require options for delivery timing and cost, suppliers may require expanding their sources or methods. The economic situation in the Middle East further complicates the relationship between buyers and suppliers. Inflation, depreciation of currency, and fluctuations in energy prices can all place significant pressure on both customers and suppliers. Rising production expenses for manufacturers could lead to increased prices for customers. Nonetheless, purchasers may encounter financial limitations and a decrease in demand, especially if their customers are affected by the economic recession. A strong partnership based on open communication and trust allows both parties to negotiate fair terms and adapt to changing economic conditions without compromising the overall viability of the supply chain.
