The world’s second-largest economy continues to pursue its Zero-COVID strategy, despite other countries trying to survive the virus.Blockades in major cities in China not only affect post-pandemic recovery, but also blow new To the global supply chain.
The southern cities of Shenzhen, which borders Hong Kong, are home to the following Chinese high-tech giants: Tencent ((((TCEHY). After recording 66 positive cases on Saturday, we imposed a one-week blockade from Monday.
In that statement Delivered to CNN Business on Monday “The local government will notify you of the reopening date of the factory,” Foxconn said.
Foxconn has two major campuses in Shenzhen. The Taiwanese company has “adjusted” the production line to another site to “minimize the potential impact” of the turmoil.
The shares of Foxconn Interconnect Technology, based in Taipei, a subsidiary of Foxconn, plummeted 9.8% in Hong Kong on Monday.
China is working on the worst Covid outbreak since its first outbreak in Wuhan According to the National Health Commission (NHC), the number of cases surged nationwide in early 2020, with 2,125 local Covid-19 cases reported in 58 cities.
In Shenzhen, all businesses are shut down or have a telecommuting policy in place, except for businesses that are deemed essential or engaged in supply to Hong Kong.
Public transportation such as the subway and buses stop in the city, which has a population of 17.5 million.
Shenzhen also has one of the largest container ports in the world, where the turmoil can hurt the already stressed world supply chain.Yantian Harbor in Shenzhen last summer After the infection was discovered in dock workers, it was forced to close for almost a week, with a large backlog of goods, months to clear, and global freight spikes. So far, the port is still in operation.
Shares of a large Shenzhen-based company failed in Hong Kong on Monday. Tencent fell 9.8%.Telecom company ZTE ((((ZTCOF). Lost 7%. BYD ((((BYDDF)., China’s largest electric vehicle maker decreased by 8.3%.and AAC technology ((((AACAF).Audio component makers plummeted 9%.
Apart from Shenzhen Municipalities have also closed the industrial hub northeast of Changchun since Friday. There, 9 million inhabitants were forbidden to leave their neighborhood.
Shanghai, the country’s largest business center, has taken strict measures after a surge in Covid cases, closing schools and movie theaters and restricting travel to the city.
These blockades occur just months after China closed the northwestern city of Xi’An. Xi’An has hit major businesses, including those of Samsung and Micron, two of the world’s largest chip makers.
These rigorous steps taken to control the pandemic have recently hit China’s economy hard. Earlier this month, the government set an economic growth target for 2022 at around 5.5%. This is the lowest official goal in decades.
— CNN’s Beijing office contributed to this report.