Shanghai euphoria tempered by deep wound to China's economy

1/6/2022 3:30:00 PM

Shanghai euphoria tempered by deep wound to China's economy

Shanghai, Lockdown

Shanghai euphoria tempered by deep wound to China's economy

SHANGHAI — Orders have evaporated at Mr Zhou's textile company based just outside Shanghai , a city now stumbling free from a two-month lockdown that has left small businesses on life support.

Shanghai, a city of 25 million, is the centre for innumerable supply lines that radiate across the country's eastern seaboard, including Tesla cars and iPhones.SUPPLY CHAINS CHAINEDFactory activity nationwide plummeted to a two-year low in April after Shanghai shut its 25 million residents at home while multiple Omicron-driven outbreaks bubbled up elsewhere, with activity continuing to shrink — albeit at a slower pace — into May.

"The impact is big... I didn't even (try to) evaluate how much I have lost during the lockdown," Mr Xu said, adding he hopes the next two to three months could see a bounce-back.CONSTANT UNCERTAINTY"But the restrictions when you go outside of Shanghai are still there."

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China says its Jan-April non-financial outbound direct investment rises 4.5% y/yBEIJING : China's non-financial outbound direct investment (ODI) in the first four months of the year rose 4.5 per cent from a year earlier to $35.88 billion, the commerce ministry said on Monday.In yuan terms, ODI grew 2.5 per cent in the January-April period from a year earlier, the ministry said in a s

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Sales are on"a very serious downward slope" and layoffs are imminent at his factory, owner Zhou told AFP, asking for his company to remain unidentified.https://str.LinkedIn BEIJING: China's non-financial outbound direct investment (ODI) in the first four months of the year rose 4.LinkedIn HONG KONG: Chinese conglomerate Fosun International said on Tuesday (May 31) it has agreed to sell all its 4.

The firm is based in Zhejiang province, the anteroom to Shanghai's cavernous consumer and manufacturing market. His is one of tens of thousands of small enterprises clinging to life as China's strict zero-Covid policies drive a crippling economic slowdown. The Straits Times' China bureau chief Tan Dawn Wei chats with Money FM 89. Shanghai, a city of 25 million, is the centre for innumerable supply lines that radiate across the country's eastern seaboard, including Tesla cars and iPhones. In yuan terms, ODI grew 2. For Mr Zhou, survival will be his only thought over the next two months in an economy whose growth forecast has been clipped by rating agencies. Your browser does not support iframes, but you can use the following link: Link Shanghai is to ease Covid-19 restrictions and help businesses recover. "I will have to fire people," Mr Zhou said, as he scours for customers to fill his order book.78 million H shares of Tsingtao at HK$62 apiece, a 4.

SUPPLY CHAINS CHAINED Beijing is tied to a strategy of eliminating Covid-19 outbreaks through harsh lockdowns and mass testing, even as most of the rest of the world has chosen to live with the virus. China's Foreign Minister Wang Yi met up with his Pacific Island counterparts in Suva to establish a trade and security pact. That has meant closing factories, disrupting logistics, and squeezing travel to almost zero for weeks on end in major manufacturing hubs including Shenzhen and Shanghai, home to the world's busiest container port. Factory activity nationwide plummeted to a two-year low in April after Shanghai shut its 25 million residents at home while multiple Omicron-driven outbreaks bubbled up elsewhere, with activity continuing to shrink — albeit at a slower pace — into May. The slowdown has choked entire supply lines. "Downstream factories, stores and businesses are all affected," Mr Xu Xuebing, owner of Shanghai-based wood supplier Sam Wood told AFP.49 per cent of Tsingtao, held by Fosun Industrial.

"The impact is big... I didn't even (try to) evaluate how much I have lost during the lockdown," Mr Xu said, adding he hopes the next two to three months could see a bounce-back. Shanghai's lockdown has calcified businesses across China, analysts say, with fears any new virus clusters could see swathes of the country once more plunged into lockdown.

"Lingering uncertainties" are bad for business confidence, Ms Peiqian Liu, China Economist at NatWest Markets, told AFP. CONSTANT UNCERTAINTY Reopening also does not guarantee total recovery, Mr Zhaopeng Xing, senior China strategist at ANZ Research, warned. "Mobility inside Shanghai is lifted," Mr Xing said. "But the restrictions when you go outside of Shanghai are still there." "A lot of logistics issues haven't been restored 100 per cent to previous levels," Mr Xing said, adding"the losses of the past two months" would not be easy to recover from.

Spooked by the unpredictability and harshness of the Shanghai lockdown, foreign businesses have also raised fears over their futures in China. Meanwhile, experts say smaller enterprises will shy away from hiring"due to the uncertainty of business environment from future lockdowns," Ms Iris Pang, chief economist for Greater China at ING, told AFP. China's urban youth unemployment rate hit 18.2 per cent in April, according to the National Bureau of Statistics. STAYING ALIVE Sagging economic indicators have alarmed Chinese authorities, who are now rushing to inflate confidence and prop up ailing sectors.

The central government has said it will offer tax relief and a bond drive to help industries while increasing government procurement from smaller businesses. But analysts are cautious about China's growth in the coming months, with Moody's on Monday lowering its annual growth forecast to 4.5 per cent. Beijing is likely to"hand out its stimulus as fast as possible", Natixis economist Gary Ng said. "But the rebound may not arrive in Q3 2022 and it is unlikely to see a big change in the Covid-19 policy until the year-end," he added.

For Mr Zhou the textile maker, survival trumps profit in zero-Covid China. "I don't need to make more money than my competitors, but I need to be able to hold on for longer than them over this difficult period," he said."This is my short-term plan." AFP Related topics .