**4.3 Offshore-outsource vs. carbon dioxide tradeoff**

Among the major greenhouse gases (GHGs), carbon dioxide (CO2) tops the list. The emission of CO2 causes global warming and erratic Climate changes (e.g. flooding). By 2018, China was the leading producer of CO2, 10.06 GT (28% of the total CO2 emission), with almost half to the second producer of CO2, the US (5.41 GT, 15% of the world total). The huge amount of CO2 production is attributed to the high number of offshore-outsource manufacturing companies in the country, as China is the number one destination for offshore-outsource companies. The Paris

#### **Figure 4.**

*NO2 distribution in eastern Asia in January and February 2020, as reported by NASA. The images were captured by Sentinel-5 satellite [25].*

**111**

instances.

**5. Conclusion**

*Offshoring-Outsourcing and Onshoring Tradeoffs: The Impact of Coronavirus on Global Supply…*

Agreement on limiting the global temperature targets a maximum increase of 1.5°C by 2100; however, the current trends in GHG production show that this goal cannot be achieved. In 2015 and 2016, total warming exceeded 1.0°C [29]. Mitigation pathways to limit the warming by 1.5°C by the end of the century are far behind, and they have received little attention. It is estimated that it will cost US\$ 50 trillion to keep the global temperature rise below 3.0°C by the end of the 21st century [30]. If countries are to implement onshoring, and this cost is to be shared based on the emission percentage, it could be too expensive for nations like Brazil and SA to implement onshoring. SA contributes 1% of total CO2 emission; coal contributes 77% of SA's energy needs. Thus, any manufacturing activity risks the production of

Another pandemic tradeoff is that of offshore-outsource vs. livelihoods. Most people, especially in many developing nations, live on the poverty line, depending mainly on COVID-19-impacted industries such as travel, tourism, hospitality, call centres, and manufacturing. However, the pandemic presents a catch-22 situation for those nations that provide offshoring and outsourcing business services to multinationals. On the one hand, the countries that provide outsourcing and offshoring services are unable to fulfil their targets due to lockdown, an impact which drives multinationals into bankruptcy and out of their countries. As such, many nations are caught between maintaining their livelihoods by keeping multinational businesses in their countries, which ensures employment, food on the table, jobs, and which prevents multiple deaths from hunger and poverty. On the other hand, against the need to maintain offshore and outsource services, is the risk of increased morbidity and mortality from COVID-19 which places a greater demand on an already strained healthcare system and limited resources such as ventilators and PPE. This has left many nations vulnerable and defenceless to both challenging

Thus, this requires creating an imminent negative or positive restructuring of offshore-outsource strategies. For example, the several research studies that required clinical trials and the collaborative participation of multinationals in the fight against diseases such as Parkinson's disease, and leishmaniasis (a parasitic disease associated with poverty and malnutrition) have been suspended. The suspension threatens livelihoods that relied on outsourced and offshored clinical services, and the research skills to reduce the impact of such diseases in society [31]. Also, the disruption to the distribution of outsourced malaria-prevention products, such as insecticidal nets, could lead to an increase in malaria deaths in sub-Saharan Africa. Yet, the continuation of offshore-outsource production and research services

Outsourcing-offshoring has played a cardinal role in the development of our economies and is the backbone of the global market. Our study provides a comprehensive analysis of the current and future trend of outsource-offshore post-COVID-19. The current trend of border closure and transport restriction does not favour outsource-offshore practices, rather onshore business. However, meticulous analysis of the supply chain, shows that the cost of onshore outweighs outsource-

equally increase morbidity and COVID-19 mortality.

offshore as summarised in the following tradeoff benefits.

*DOI: http://dx.doi.org/10.5772/intechopen.95281*

CO2—a cost SA may not be able to afford.

**4.4 Offshore-outsource vs. livelihoods**

*Offshoring-Outsourcing and Onshoring Tradeoffs: The Impact of Coronavirus on Global Supply… DOI: http://dx.doi.org/10.5772/intechopen.95281*

Agreement on limiting the global temperature targets a maximum increase of 1.5°C by 2100; however, the current trends in GHG production show that this goal cannot be achieved. In 2015 and 2016, total warming exceeded 1.0°C [29]. Mitigation pathways to limit the warming by 1.5°C by the end of the century are far behind, and they have received little attention. It is estimated that it will cost US\$ 50 trillion to keep the global temperature rise below 3.0°C by the end of the 21st century [30]. If countries are to implement onshoring, and this cost is to be shared based on the emission percentage, it could be too expensive for nations like Brazil and SA to implement onshoring. SA contributes 1% of total CO2 emission; coal contributes 77% of SA's energy needs. Thus, any manufacturing activity risks the production of CO2—a cost SA may not be able to afford.

#### **4.4 Offshore-outsource vs. livelihoods**

*Outsourcing and Offshoring*

tion (μmol/m<sup>2</sup>

Air pollution is responsible for 4.2–7.0 million premature deaths every year [3, 23], and it costs \$4.6 trillion per year [24]. This number barely makes headlines, although it is more than five times the current COVID-19 deaths. COVID-19 has elicited that there is a clear correlation between emissions and outsourcingoffshoring. **Figure 4** shows the mean tropospheric nitrogen dioxide concentra-

Administration (NASA) in January and February 2020. The levels of NO2 plummeted following the virus outbreak in far Asia [25] due to the closure of factories and reduced movement of workers that use cars to go to work. The decrease in ozone precursors, like NO2, could reflect a reduction in ozone levels; however, ozone concentration increased. Ozone breathing triggers COVID-19 like symptoms like chest pain, coughing, and airway inflammation [26]. Another pollutant that is related to manufacturing is particulate matter (PM). PM elevates cancer, premature deaths, coughing and eye diseases, among others [27]. The production of particulate matter below 2.5 microns (PM2.5), a harmful emission, accelerated in countries like China [28] due to outsourcing-offshoring business in the country. As countries are rushing to tradeoff offshoring and outsourcing companies back home, they should meticulously calculate the cost related to air pollution; other-

Among the major greenhouse gases (GHGs), carbon dioxide (CO2) tops the list. The emission of CO2 causes global warming and erratic Climate changes (e.g. flooding). By 2018, China was the leading producer of CO2, 10.06 GT (28% of the total CO2 emission), with almost half to the second producer of CO2, the US (5.41 GT, 15% of the world total). The huge amount of CO2 production is attributed to the high number of offshore-outsource manufacturing companies in the country, as China is the number one destination for offshore-outsource companies. The Paris

*NO2 distribution in eastern Asia in January and February 2020, as reported by NASA. The images were* 

wise, pollution costs might outweigh such a venture.

**4.3 Offshore-outsource vs. carbon dioxide tradeoff**

) as a satellite image from the National Aeronautics and Space

**110**

**Figure 4.**

*captured by Sentinel-5 satellite [25].*

Another pandemic tradeoff is that of offshore-outsource vs. livelihoods. Most people, especially in many developing nations, live on the poverty line, depending mainly on COVID-19-impacted industries such as travel, tourism, hospitality, call centres, and manufacturing. However, the pandemic presents a catch-22 situation for those nations that provide offshoring and outsourcing business services to multinationals. On the one hand, the countries that provide outsourcing and offshoring services are unable to fulfil their targets due to lockdown, an impact which drives multinationals into bankruptcy and out of their countries. As such, many nations are caught between maintaining their livelihoods by keeping multinational businesses in their countries, which ensures employment, food on the table, jobs, and which prevents multiple deaths from hunger and poverty. On the other hand, against the need to maintain offshore and outsource services, is the risk of increased morbidity and mortality from COVID-19 which places a greater demand on an already strained healthcare system and limited resources such as ventilators and PPE. This has left many nations vulnerable and defenceless to both challenging instances.

Thus, this requires creating an imminent negative or positive restructuring of offshore-outsource strategies. For example, the several research studies that required clinical trials and the collaborative participation of multinationals in the fight against diseases such as Parkinson's disease, and leishmaniasis (a parasitic disease associated with poverty and malnutrition) have been suspended. The suspension threatens livelihoods that relied on outsourced and offshored clinical services, and the research skills to reduce the impact of such diseases in society [31]. Also, the disruption to the distribution of outsourced malaria-prevention products, such as insecticidal nets, could lead to an increase in malaria deaths in sub-Saharan Africa. Yet, the continuation of offshore-outsource production and research services equally increase morbidity and COVID-19 mortality.

#### **5. Conclusion**

Outsourcing-offshoring has played a cardinal role in the development of our economies and is the backbone of the global market. Our study provides a comprehensive analysis of the current and future trend of outsource-offshore post-COVID-19. The current trend of border closure and transport restriction does not favour outsource-offshore practices, rather onshore business. However, meticulous analysis of the supply chain, shows that the cost of onshore outweighs outsourceoffshore as summarised in the following tradeoff benefits.

