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Shanghai lockdown snarls world’s busiest port and China supply chains

Chinese manufacturers say the lockout, no matter how flexible or intentional, is putting pressure on their business.

Shanghai’s coronavirus key is slowly closing in on Chinese supply chains, as it slowly enters the world’s most congested port where workers are confused about Covid’s control.

Beijing has refused to abandon its stricter COVID-Covid strategy which protects its public health system through an outbreak but in a recession.

China’s Shanghai financial center – home to international companies and most busy ports – was closed almost a week after the Omicron outbreak.

That has forced many companies to stop production and simplify new jobs, the industry has told AFP, while workers are struggling with a shortage of truck drivers over high license and Covid test requirements.

At the Shanghai port, the lack of drivers and other personnel means imports become more difficult.

Ports operate on a regular basis with a “single number” number of ships waiting to land, the Shanghai International Ports Association said this week.

Bettina Schoen-Behanzin, vice-president of the EU Chamber of Commerce in Shanghai, told AFP, “Because of the sanctions imposed on truck drivers, it really does not work.”

The figures I heard were … Weekly rates at Shanghai Ports have dropped by 40 per cent. So this is a huge increase. “

The shortage has started to spread across the Chinese economy, with online shopping malls such as Taobao facing delays in delivery of goods, especially imported goods.

Cholera in many cities has forced industries to find new suppliers.

But the impact could soon be felt outside of China if the lockout continues.

Shanghai is the world’s first port, the backbone of the interior global supply chain and an important gateway to foreign trade.

It manages about 17 percent of China’s total shipments and delivers 47 million TEUs – a measure of cargo volume, meaning a 20-foot balance sheet – by 2021.

Industries cannot operate from home

Chinese manufacturers say the lockout, no matter how flexible or intentional, is putting pressure on their business.

Jason Lee, founder of Megalicht Tech wheelchair company, whose factory in Puxi area of ​​Shanghai has stopped working from home, said Jason Lee.

The Shanghai coronavirus key is slowly closing in on Chinese chains

The Shanghai coronavirus key is slowly closing in on Chinese chains.

“People will not be able to enter the industry … and because of the resources we get from other provinces or cities, these too will not be able to enter Shanghai,” he said.

Shanghai-based clothing retailer Zheng said his biggest problem was that he could not deliver the product to customers.

“The market cannot go in or out,” he said

Experts say the outbreak is currently growing, but will soon be able to continue growing.

Nomura economists estimate that 23 cities with 22 percent of China’s GDP are closed or partially closed.

“The cost of zero-covid strategy will rise sharply as profits fall, especially as export exports continue,” Chinese economist Lu Ting told AFP. . “

He added that this would challenge the target of GDP growth of 2022 by almost 5.5 percent.

Adjust to survive

Currently, companies are adjusting to test and take restrictions.

“Our trade volume has shrunk by more than 50 percent,” said Gao Yongkang, chief technology officer of Qifeng in the eastern Chinese city of Quanzhou.

The company was unable to deliver textile products to regular customers due to Covid’s blockchain, and instead focused on creating a growing market for protective products.

Meanwhile, those who could not reach the original suppliers are looking for new ones.

Shen Shengyuan, deputy general manager of New Yifa Diaper Group, said: “The costs are low and low but we can meet our daily needs.”

In a development for the struggling industries, Premier Li Keqiang this week announced a temporary delay in the insurance premiums for the elderly in sectors such as food, sales and aviation.

But industry groups say strict sanctions on major cities like Shanghai are uncertain, especially with many Omicron cases illuminating or showing no signs of disease.

“Is zero-covid strategy still working in the current situation,” said Eric Zheng, president of the American Chamber of Commerce in Shanghai.

“That’s a big question, especially when you’re trying to balance economic prices.”


Shanghai will lock in steps to control COVID-19 outbreak


© 2022 AFP

hint: Shanghai lock destroys world’s most beautiful port and Chinese supply chain (2022, April 8) Retrieved April 8, 2022 from https://medicalxpress.com/news/2022-04-shanghai -lockdown-snarls-world-busiest.html

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Shanghai lockdown snarls world’s busiest port and China supply chains Source link Shanghai lockdown snarls world’s busiest port and China supply chains

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