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Zero-Covid in China
Even 2 years after the start of the coronavirus pandemic, the virus is still having a major impact on our lives, especially the regulations and restrictions. This also applies to international business. This is because the restrictions make business trips and therefore direct contact between business partners more difficult.
At the moment, the business relationship between China and other countries has even worsened as a result of the pandemic. This is because many major Chinese cities are in complete lockdown. These regulations are the result of the Chinese government's zero-covid strategy, which aims to have no coronavirus cases anywhere in China. In a country as large as China, this strategy requires drastic measures, such as the lockdown for entire cities. Shanghai, the largest city in China and an important trading center, where one of the most important ports in Asia is located in addition to our Kaiserberg office, is currently in a complete lockdown. A 7-day lockdown in Shenzhen had already ended shortly before.
These lockdowns in important trading areas in China are having a major impact on many European and American companies. Tesla, for example, has already seen its own production in Shanghai come to a standstill for several days. Many German companies are based in Shanghai; however, most of their production facilities are located outside the city limits in the surrounding Jiangsu province. Some large industrial parks are affected, such as the Caojing Chemical Park in the west of Shanghai, where BASF, for example, produces.
Many companies and factories around Shanghai are experiencing this, as people there are in quarantine or are unable to enter the city from outside due to the lockdown, which is why the assembly lines in the factories are at a standstill. For these reasons, the government has long tried to avoid this lockdown, but without success. In recent weeks, however, Shanghai has become the country's coronavirus hotspot, with over 60% of all new infections in China, and the city of 26 million inhabitants is now in a gradual lockdown. The lockdown begins first to the east of the river and then to the west. All businesses in the restricted areas have to close and people are expected to work from home as far as possible. Unfortunately, this is not possible in many areas. Some companies have organized the lockdown in such a way that employees are on the company premises the entire time, working there, receiving meals and a bed. Production can continue as usual in these production facilities.
