New closures in Shanghai pose problems for the world’s busiest port

Shanghai is currently marked by one of the largest coronavirus outbreaks in China since the virus began spreading from Wuhan in late 2019.

On Friday, the city’s health authorities recorded 21,000 cases of infection, of which only 824 were said to have symptoms. Since the omicron outbreak began last month, the number of infections has exceeded 100,000.

Chinese authorities have questioned their zero-infection strategy and are taking firm action to prevent the spread of infections.

With the outbreak of omicron infections in the country, the shutdowns have forced many companies to slow down production. At the port of Shanghai, there is now a critical shortage of drivers and workers, while a comprehensive testing system has also created major delays for the operation of the world’s busiest port.

– Weekly operations are down 40 percent, so this is huge, said Bettina Schön-Behanzin, vice president of the European Chamber of Commerce in Shanghai.

Factory closed

The Chinese metropolis has one of the most important port facilities in the world and is a hub in global supply chains. The port handles about 17 percent of China’s port freight. Last year, 47 million containers (TEU) passed through the Shanghai port.

Chinese manufacturers say that closures, no matter how flexible and targeted they are, are putting their businesses under a lot of stress.

One of the Shanghai factories that had to stop production was wheelchair manufacturer Megalicht Tech. Company manager Jason Lee said the situation was demanding.

– There are not many tasks that can be completed from the home office. People were not allowed into the factory. And our raw materials come from other provinces or cities, and they don’t come to Shanghai either, said Lee.

money brake

China’s large consumer economy will soon be hit by a shortage of goods with major delays in the delivery of goods. In some closed cities, factories were forced to look for new suppliers in hopes of turning the wheel.

China’s 23 cities, which account for 22 percent of China’s gross domestic product (GDP), have been hit by the shutdown, economists from Japanese financial house Nomura estimated.

– Costs as a result of a no-infection strategy will increase rapidly as benefits diminish, especially as exports are impacted by the ongoing shutdown, said chief economist Lu Ting at Nomura.

Such increased costs would mean that it is a farce for China’s goal of 5.5 percent GDP growth by 2022, Lu believes.

Struggling with food delivery

The city government has introduced mass testing of its 26 million residents. Everyone who tests positive is sent to an isolation center, often a temporary center at the gym.

Residents were sent food boxes containing meat and fruit from the authorities. However, many people find it difficult to find rice and other foods. You can’t order over the internet, and delivery companies are struggling to make ends meet.

There is no time limit on when the strict restrictions will be lifted, and many citizens are frustrated by the authorities’ lack of long-term planning.

Three local officials in Shanghai have been fired for reacting too slowly to the outbreak. No specific details were given about the circumstances, but an official said the three did not meet requirements to prevent the spread of infection, leading to “serious consequences”.

Georgie Burke

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