China’s manufacturing sector slowed to its weakest in almost two years as the country’s stringent “Zero-COVID” measures forced many factories into shutdowns and entire cities into full lockdowns.
In its drive to completely eradicate the virus from China, the Chinese Communist Party (CCP) has implemented strict lockdown policies wherever cases of the virus are detected, in many cases leading to violence and tragedy.
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A monthly snapshot of China’s industrial output for the first quarter showed production struggling to keep up with demand. The Caixin/Markit purchasing managers’ index dropped from 50.9 in December to 49.1 in January – turning up the pressure on China’s policymakers to step up support for the world’s second largest economy.
A reading below 50 suggests output is shrinking rather than expanding, with the first quarter figure’s reflecting the weakest numbers since February 2020, when blanket restrictions were enforced during the first wave of the pandemic.
Wang Zhe, a senior economist at Caixin Insight Group, told the Guardian that “Over the past month, there were Covid-19 flare-ups in several regions in China, underscoring the downward pressure on the economy.”
Wang said the spread of the highly contagious Omicron variant overseas hit China’s external demand, with the gauge for new export orders in January expected to be the lowest in 20 months.
“Both supply and demand in the manufacturing sector weakened. Several regions tightened epidemic control measures following the resurgence, which impacted production and sales of manufactured goods,” Wang said, adding that “the subindexes for output and total new orders in January fell to their lowest since August of last year. Overseas demand shrank at an even faster pace.”
In comparison, growth figures for the European Union showed output in the single currency zone has returned to pre-pandemic levels.
According to the EU’s statistical agency, Eurostat, gross domestic product in the eurozone rose by 0.3 percent in the final three months and by 5.2 percent in 2021 as a whole. The quarterly growth rate eased from the 2.3 percent recorded in the third quarter, following the reintroduction of restrictions to slow the spread of the virus.
Migrant workers in China struggling to make ends meet
The lockdowns have also affected millions of migrant workers who travel to China’s cities in order to find work in factories or other low paying jobs such as delivery couriers. About 300 million of these workers depend on these labor-intensive roles for their livelihoods and to support their families back home.
The Chinese government announced on Dec. 26 that rural migrant workers across the surrounding Shaanxi Province would not be allowed to leave Xi’an during the Lunar New Year celebrations taking place today.
For many, the break was the only chance in the year to return home and reunite with their families. These workers usually work six to seven days a week and only have a break once a month or for special holidays such as Chinese New Year.
Wilson You from Xiamen runs a tile manufacturing plant and said his business has been essentially halted since the second wave of the pandemic started.
“We have not been able to run production lines because the government ordered us to shut down again in December.” You told Vision Times, adding that although they have many purchase orders coming in from overseas companies such as the U.S. and Europe, they cannot fulfill these orders until production is allowed to resume.
You also said the migrant workers he hires have begun panicking as many depend on the factory to send money to their families back home.
Production ‘stagnant or fully shut down’
Jiang Guang, a worker in Wilson’s factory, traveled to Xiamen from Dalian in 2018 to find work and said his family of seven all count on his salary to make ends meet. “I have not been able to send money back home for several months now because production has remained stagnant or fully shut down since the second wave of [COVID-19] started up here.”
Xiamen is a port city in Fujian Province and home to nearly 5 million people. The city has been a driving force for the country’s exporting sector but has seen significant struggles since the Chinese regime’s anti-COVID measures have taken place.
Although the pandemic has claimed millions of lives worldwide and caused catastrophic economic losses for some countries, Chinese authorities claim slightly over 101,000 infections and less than 5,000 deaths nationwide — hailing its “zero COVID” policies as instrumental.
Despite this claim, there has been doubt cast over the veracity of these figures as well as the effectiveness of Beijing’s heavy-handed lockdown policies. These policies have included disinfection theatrics, draconian lockdowns, mass testing and travel restrictions to sustain China’s illusion of curbing the pandemic’s spread.
Xiamen has been under a partial lockdown since October 2021.