Coronavirus: Digest of business-focussed articles from national and international media, selected by George Hamilton. Some may require a subscription to obtain the full version (paywall)
Headlines in this issue
- China slow to re-open
- China fears losing supply-chain buyers..
- ..and could this put globalization under threat?
- Money laundering in China – by decree
- And there’s a new bottom line for Hong Kongers
- Slowed by the Coronavirus, China Inc. Struggles to Reopen
Some factories are firing up again, but with many workers quarantined and parts in short supply, production is limited.
Airbus is slowly restarting its assembly line in China. General Motors began limited production on Saturday. Toyota followed on Monday morning.
Now, as some factories rumble back into action, the monumental task of restarting China is becoming clear.
Still, the pace of new cases officially confirmed in mainland China, the center of the outbreak, has slowed over the past three days.
Restarting China’s factories is only part of the challenge. The country has a huge services and consumer sector, including shops and restaurants enjoyed by an increasingly affluent middle class. Those businesses have also been devastated by the outbreak, which has kept many Chinese families confined to their homes.
New York Times 17 Feb
Chinese economy: eye-opening facts, fears
China has 288 million migrant workers, who account for about a third of the country’s labour force. Many who travelled to rural homes for the holidays will be either unable or unwilling to return to work in the cities.
Currently, 30 of China’s 31 provinces have declared a top-level public health emergency, with all major cities and economic hubs effectively shut for weeks.
In a survey of 995 SMEs, 85 per cent said they would be unable to survive for more than three months under the current conditions.
If the disruption goes on long enough, it could trigger a wave of bankruptcy among SMEs, which contribute more than 60 per cent of China’s GDP, 70 per cent of its patents and account for 80 per cent of jobs nationwide.
China used more cement (6.6 gigatons) between 2011 and 2013 than the US did in the entire 20th century (4.5 gigatons) and produced more steel in just two years (May 2017 to 2019) than Britain did in over 150 years.
But the coronavirus outbreak has increased the volume of commentary on China’s stalling economic picture and fears for the future.
This info is from two separate articles, one from Professor Chris Rowley visiting fellow at Kellogg College, University of Oxford and Professor Emeritus, Cass Business School, City, University of London and Cary Huang a veteran China affairs columnist
https://www.scmp.com/comment/
https://www.scmp.com/week-
South China Morning Post 16 Feb
Coronavirus Is ‘Threatening the Future of Globalization,’ Economist Says
Chief economist from research company Capital Economics, Neil Shearing, warned that there are signs the economic disruption to China was spreading to other countries.
Pointing to the biggest slump in Chinese exports to South Korea since the Asia financial crisis in 1999, Shearing said that a prolonged shutdown might mean that lost output in China would never be recovered.
Factory closures in China mean a shortage of component parts which would cause companies to reassess large and complex supply chains.
In comments to Newsweek, Shearing added that firms will question the benefits of maintaining supply chains on their current scale.
“The risk of disruption posed by pandemics or natural disasters would add to the reasons to make this shift. That would all point to production becoming more localised or, perhaps more likely, regionalised,” he told Newsweek.
https://apple.news/
Newsweek 17 Feb
China is disinfecting and destroying cash to contain the coronavirus
China’s central bank has implemented a new strategy to contain the virus — deep cleaning and destroying potentially infected cash.
All Chinese banks must now literally launder their cash, disinfecting it with ultraviolet light and high temperatures, then storing it for seven to 14 days before releasing it to customers
Cash that comes from high-risk infection areas, like hospitals and wet markets, will be “specially treated” and sent back to the central bank instead of being recirculated.
And in the central bank’s Guangzhou branch, these high-risk banknotes may be destroyed instead of merely disinfected, according to state-run tabloid Global Times.
https://news.google.com/
CNN Business 17 Feb
..and finally, amongst the gloom of the virus, a little light – non-biz – relief..
Armed robbers steal hundreds of toilet rolls in Hong Kong
Armed robbers in Hong Kong made off with hundreds of toilet rolls worth more than HKD1,000 ($130; £98).
Toilet rolls are currently in short supply in Hong Kong due to shortages caused by panic-buying during the coronavirus outbreak.
Knife wielding men robbed a delivery man outside a supermarket in the Mong Kok district, police said.
Police have arrested two men and recovered some of the stolen loo rolls, local media reports said.
https://www.bbc.co.uk/news/
BBC News 17 Feb
