China’s Covid-19 cases are falling as restrictions disrupt business
China’s Covid-19 cases are falling as restrictions disrupt business

China’s Covid-19 cases are falling as restrictions disrupt business

HONG KONG-CHINA reported on Wednesday a drop in new coronavirus cases as authorities worked quickly to limit outbreaks with lockdowns and factory closures, as well as stricter restrictions on the movement of persons and goods.

Businesses need to navigate rapidly changing restrictions, making it difficult to measure the extent of the impact on China’s economy and global supply chains. In the southern tech hub and export powerhouse in Shenzhen, Apple Inc. assembler

Foxconn

Technology Group said it had been approved to resume some operations;

Tesla Inc.

said it would suspend production at its Shanghai plant; and tighter controls on taking goods between provinces threatened to disrupt the country’s logistics sector.

Whether China can quickly curb the outbreaks could have profound consequences for the global economy. Shares in Chinese companies staged and rebound Wednesday after Beijing moved to reassure investors rattled over the prospect of extensive factory closures and disruption of trade.

Officials promised to “keep the economy operating within a reasonable area” by coordinating Covid-19 containment policies, Xinhua, China’s state news agency, reported on Wednesday.

In recent days, Chinese officials have reported rising Covid-19 case numbers across the country, prompting more aggressive containment measuresfrom shutting down public transportation in Shenzhen to ordering residents to stay at home in Changchun, the capital of Jilin Province.

New infections reported Wednesday fell more than a third to 3,054, with nearly half of the cases found in the northeastern province of Jilin. Since Monday, its 24 million people have not been allowed to leave the province as authorities race to stop the outbreak and prevent it from spreading. After registering more than 4,000 infections on Monday, new cases dropped to 1,456. Jilin said it had already built eight makeshift hospitals with a total of 11,488 beds.

As countries loosen Covid-19 restrictions, Hong Kong is sticking to a ‘dynamic zero-Covid’ approach – with the help of Beijing. An increase in cases has overwhelmed hospitals and threatens business confidence in the global financial center. Photo: Bertha Wang / Bloomberg

In neighboring Liaoning province, authorities said they would suspend public transportation and online taxi services in the coastal city of Yingkou.

Dongguan, another major manufacturing center in Guangdong Province, on Monday announced what it called “the beginning of a temporary slow life.” Authorities there suspended dining and introduced stricter controls on factories.

On Wednesday, Taiwan-based Foxconn said it was able to restart some operations on Shenzhen campuses, where workers live in dormitories next to assembly lines, in accordance with policies issued by the city government. The company had previously reported that its factories in Shenzhen would be closed for a week.

Officials in Shanghai said on Tuesday that they had no plans for a city-wide closure and for now would take more targeted action to tackle the outbreak. The financial center reported 202 cases on Wednesday, of which 197 were asymptomatic. City officials ordered indoor businesses and schools to close in recent days, while a number of residential areas have been temporarily cordoned off as residents were tested for the virus.

Tesla Inc., which makes Model 3 sedans and Model Y sports-utility vehicles in the city, told employees and suppliers it would halt production Wednesday and Thursday, people familiar with the matter said. The electric car maker gave no reasons for the suspension, they said. Tesla did not immediately respond to a request for comment.

Tesla sold more than 56,000 cars manufactured there in February, of which nearly 60% were exported outside China, data from the China Passenger Car Association showed.

Modern Amperex technology Co.

the world’s largest battery maker, said its business – including a factory close to Teslas – was running as usual.

Meanwhile, the spotlight is on China’s giant express delivery industry – with the country already a world leader in online shopping, Covid-19 had given the industry a boost as more consumers avoided crowded places and ordered goods to their doors. Now, delivery workers and the packages themselves have been accused of spreading infections.

Local media reported on clusters of infections or identified close contacts among SF Express Co. workers where groups were to be quarantined. SF Express could not be reached for comment.

An online chat with a customer service robot from SF Express showed disruptions of same-day deliveries in Hangzhou and city-wide temporary stops for deliveries in, among others, Wenzhou. No packages would be sent at the moment to Huzhou and Ningbo, other cities in Zhejiang province.

United Parcel Service Inc.

also issued service alarms. Pick-up and delivery were suspended in Shenzhen and Dongguan, while imported goods in Zhejiang province and elsewhere would be set aside for four to seven days for disinfection, the company’s website said.

Write to Natasha Khan at [email protected]

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