Omicron cases in China threaten its manufacturing hubs

21

China has been battling sporadic Covid outbreaks that are weighing on its major manufacturing hubs, Global Times reported.

Less than 24 hours after North China’s Tianjin reported the Chinese mainland’s first case of an imported infection of the Omicron coronavirus variant on Monday night, Guangzhou, capital of South China’s Guangdong Province, reported a new imported case infected with the Omicron strain on Tuesday.

While the sporadic outbreaks are affecting major manufacturing hubs and ports such as Shaoxing and Ningbo, two cities in Zhejiang, Dongguan, which is deemed as the world’s factory located in Guangdong, also rolled out nucleic acid tests in two of its counties at midnight on Monday after two patients tested positive for Covid.

Businesses in Zhejiang are facing logistical challenges which may impact clothing firms and other sectors of the local economy, after factory activity and transportation channels in parts of the province were suspended amid the recent resurgence of coronavirus cases, the Global Times learned.

Starting December 8, all companies, except for those making essential products or personal protective equipment (PPE) in Zhenhai, a district in Ningbo, have been required to suspend production.

On the same day, Shangyu district in Shaoxing also required local companies to suspend production, with the exception of firms producing PPE or other essential products.

Shangyu is a key hub for textile dye firms, while Zhenhai is a key base for the domestic petrochemical industry.

Aside from halting factory production, those cities have also restricted intercity transportation. Zhejiang has closed 10 freeway toll stations on five highways, while Zhenhai and Shangyu have suspended package delivery services. A total of 247 bus lines have also been suspended in Ningbo and Shaoxing.

Several local businesses told the Global Times that the suspension, combined with new public health measures limiting the flow of goods and people, has triggered logistical challenges for their companies, with truck drivers unwilling to enter the affected areas for fear they may be caught up in the new measures or forced to observe quarantine, the report said.

“We can’t ship our products from Shaoxing. Drivers from Ningbo are reluctant to come here, and warehouses in Ningbo are reluctant to accept our products,” Jin Xiaobo, the CEO of Zhejiang Kaierhai Textile Garments, which is based in Shaoxing, told the Global Times. Shaoxing is about 120 km from Ningbo.

This has caused headaches for traders, as they have no means to ship products to their overseas clients, particularly during what is the peak delivery season for clothing companies.

However, the overall impact should be limited to certain industries and localities within the province, with general supply chains remaining stable, businesspeople and officials said.

20211214-214740

LEAVE A REPLY

Please enter your comment!
Please enter your name here