MANUFACTURING SLOWS IN CHINA
An energy-draining heatwave, COVID-19 resurgence, and tropical storms have slowed Chinese manufacturing in recent weeks.
FACTORS IMPACTING CHINESE MANUFACTURING
- COVID-19
- Tropical Storms
- Heatwave
COVID-19 LOCKDOWN
China’s no-tolerance COVID-19 policy forced lockdowns in Chengdu, part of Sichuan Province, shuttering some manufacturing operations. China recently announced an indefinite extension of the current Chengdu lockdowns to mitigate COVID spreading throughout the 21.2 million people living in or near the affected region.
TROPICAL STORMS
Several tropical storms and typhoons impacted regions of China and Southeast Asia in recent weeks. The most recent was Typhoon Hinnamnor which skirted past China and made landfall in South Korea earlier this week. China closed several busy international ports including Shanghai, Ningbo, Shenzhen, and Yantian in preparation for the tropical storms. All Chinese ports resumed operations by Wednesday.
HEATWAVE
Industrial production in Chongqing and Sichuan Province was hampered in late August by government-mandated energy restrictions for all nonessential companies. Power rationing was enforced in drought-stricken regions during a heatwave ensuring individuals had access to electricity for their daily living requirements. All but heavy energy usage companies were permitted to resume normal production levels in early September. Energy-intensive manufacturers will slowly scale up production as power rationing slowly decreases for them in the coming weeks.
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