HIGHLIGHTS
- Tens of thousands are in quarantine and some domestic flights have been suspended as a national health official said the outbreak in three cities as Ningbo, Shaoxing and Hangzhou, was developing at a “relatively rapid” speed.
- The company could not sign new contracts because they were worried that they would not be delivered on time.
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Suspension of production activities
Zhejiang has reported 217 locally transmitted cases with confirmed symptoms in just eight days since the first case on Dec. 6. Tens of thousands are in quarantine and some domestic flights have been suspended as a national health official said the outbreak in three cities as Ningbo, Shaoxing and Hangzhou, was developing at a “relatively rapid” speed.
The three cities accounted for more than 50% of the province’s economic output of around 6.46 trillion yuan ($1.02 trillion) last year. Many of Zhejiang’s goods are for export.
At least 20 listed manufacturing companies including Zhejiang Mustang Battery Co, Guobang Pharma Ltd and textile dyes maker Zhejiang Runtu Co have shut operations in virus-hit areas in Zhejiang, which accounts for around 6% of China’s GDP.
The companies said they halted operations in line with local government orders in Zhenhai district in Ningbo and Shangyu district in Shaoxing, which curtailed all production bar essential manufacturing. The orders cover all companies in the affected areas, but only listed firms are required to disclose any impact on their business.
Manufacturer’s worries
Ningbo Mengheng Costume Accessories Ltd, an unlisted manufacturer of garment materials, had closed all of its factories in Zhenhai, said an employee at the company’s logistics department. The company could not sign new contracts because they were worried that they would not be delivered on time.
Zhejiang Runtu said all its units in the Zhejiang Shangyu Economic Development Zone (SEDZ), which accounts for 95% of its revenue, had been halted since Dec. 9 and it expected a negative impact on its fourth-quarter results.
Meanwhile, Sinopec’s Zhenhai Refining and Chemicals, the largest refinery in China, said it was maintaining a high operating speed despite tightened COVID measures.
Minh Ngô
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