Many US companies warn about Chinese strict control measures against COVID-19

DNHN - A joint survey by the American chambers of commerce in Beijing and Shanghai, released recently, found that more than half of 167 respondents, including 76 manufacturers, expect revenue to decline. this year due to the nationwide outbreak of COVID-19.

US businesses working in China warn that strong virus control measures, including a strict embargo of the financial center Shanghai, have harmed business and may force them to relocate if control measures are extended. 

A joint survey by the American chambers of commerce in Beijing and Shanghai, released recently, found that more than half of 167 respondents, including 76 manufacturers, expect sales to fell this year due to the nationwide COVID-19 outbreak in recent months, while about 16% of the companies surveyed said they would consider moving operations out of China. 

Additionally, more than half reported reductions in production and supply chain disruptions, with around 81% reporting that these actions impacted their capacity to recruit or keep qualified workers. 

The outbreak's epicenter has been Shanghai, where commerce has largely ceased, including factory closures and delays at one of the world's busiest ports, following the city's lockdown this week. 

The widespread lockdown, which is due to end on Tuesday (April 5), might stretch a week or more, officials added, if China maintains it. Zero COVID policy, despite the fact that a large portion of the world is infected. 

Cities in the northeast have also been under lockdown since early March. China is struggling to contain the worst of the outbreak, due to the highly contagious omicron variant. 

Shanghai accounted for about two-thirds of the 7,229 total infections reported nationwide on Thursday (March 31). Most cases are mild or asymptomatic. 

The massive shutdown has affected the operations of companies, including Tesla and Volkswagen. Electric car maker Tesla has extended the shutdown of its Gigafactory on the outskirts of Shanghai, while German carmaker SAIC Volkswagen's local joint venture said it was suspending production at its plant. within the city and a site in the northeast of Changchun City. 

The shutdown, which has stranded millions of people and forced the closure of most non-essential enterprises, is also impacting operations at Shanghai's port, potentially causing delays for important exports including as electronics, autos, and textiles. Ships are continuing to dock normally, but cargo handling has been delayed.

This week, Danish shipping group Maersk said it would suspend operations at one of its warehouses in Shanghai, leading to delivery delays and skyrocketing shipping costs.

Thousands of bankers, traders and other financial workers are living and working in office towers located along Shanghai's Lujiazui district to keep business afloat, while the Shanghai Stock Exchange Hai is operating with a team of employees sleeping right at the trading floor.

Meanwhile, factory activity in China decreased in March as a result of the epidemic, with analysts predicting that severe anti-Covid-19 measures will slow the world's second largest economy. 

"If the virus is not contained by April," economists wrote in a research report this week.

 Bao Bao