Effects of Import Source Diversity to Supply Chain Resilience: Analysis of Machinery Industries in RCEP Countries

This study aims to investigate the effects of import source diversity on supply chain resilience of machinery sectors trade in 15 Regional Comprehensive Economic Partnership (RCEP) member countries during the 2007–20 period. It finds that import source diversity, as measured by the Herfindahl-Hirschman index, was lower among relatively smaller and newly industrialising economies in the region, with significant fluctuations and higher concentration. Further, supply chain resilience, measured by export of final products, was not significantly affected by import source diversity but relies heavily on the total value of import of parts and components. This highlights that parts and components import continuity, trade openness and regional production networks play a critical role in enhancing supply chain resilience.