Shanghai to resume some production after 16-day lockdown, even as it reports more than 24,000 new cases on Sunday

Major automobile, semiconductor and biomedicine companies are to submit detailed plans about guarding against the spread of Covid-19 for the local health authorities to review
City’s total number of infections has now topped 350,000 since the outbreak began on March 1

Shanghai

Daniel Renin Shanghai

Published: 3:50pm, 17 Apr 2022

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Shanghai is on track to resume production at key manufacturing sites after a 16-day citywide lockdown, succumbing to pressure from foreign diplomats, business groups and multinational firms calling for an easing of anti-coronavirus control measures.

Major companies in the fields of automobiles, semiconductors and biomedicines are to submit detailed plans about guarding against the spread of Covid-19 for the local health authorities to review before they are given the go-ahead to resume operations in the so-called closed-loop conditions, the Shanghai Commission of Economy and Information Technology said on Saturday evening.

Saturday’s statement is the first step taken by mainland China’s commercial and financial capital to relax controls on manufacturers, most of which have idled facilities since the beginning of April.

“Shanghai’s anti-coronavirus control and prevention measures have dealt a huge blow to the automotive industry alone,” said David Zhang, a researcher at the North China University of Technology. “The lockdown brought nearly all the thousands of automotive supply-chain firms based in Shanghai to a standstill. This is a serious problem that needs to be tackled as soon as possible.”

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The decision to ease the lockdown comes despite the continued spread of the highly transmissible Omicron variant of Covid-19. Shanghai added 24,820 new Covid-19 cases, 3,238 of them symptomatic, on Sunday. The city’s total number of infections has now topped 350,000 since the outbreak began on March 1.

Wu Jinglei, director of the Shanghai health commission, told a press briefing on Sunday that another round of mass testing would be conducted in the coming days to detect infections and cut transmission chains, as the city remained adamant about achieving its zero-Covid goal. The city has conducted at least nine rounds of citywide mass testing on all of its 25 million residents since April 3.

The city’s government has vowed to detect all Covid-19 cases outside “lockdown areas” and quarantine them to cut transmission chains in a five-day campaign that started on Saturday, said two local government officials who did not want to be identified. The lockdown areas comprise hospitals, quarantine sites and high-risk residential compounds sealed off because at least one infection was found there in the previous seven days.

01:35

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The officials said that Shanghai would gradually lift its citywide lockdown after the campaign was over, and that businesses were expected to return to normal by the end of April.

Nationwide, China added 26,016 new cases on Sunday, most of them in Shanghai. The southern Guangdong province added 40 cases, 29 of which showed symptoms. Jilin province in Northeast China added 692 infections. Shanghai said 16 Covid-19 cases were severe, most of them elderly citizens aged above 70 years.

Lu Zhengrong, the deputy director of the Shanghai Commission of Agriculture and Rural Affairs, said on Sunday that 667 companies engaged in the plantation of green leaf vegetables, or 78.6 per cent of the city’s total, had restarted operations and had been supplying 2,000 tonnes of vegetables a day to Shanghai residents since Friday.

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Industry officials said the plan to resume production would see a bumpy start, since supply chain constraints and lack of manpower continued to stop factories from operating normally.

“Factories do not have enough materials and labourers to normalise production,” said a senior executive with Jinghan Stainless Products, which makes doorknobs, taps and other fabricated steel products in Pudong. “Businesses are keeping their fingers crossed that a full lifting of the lockdown could happen soon, before we go completely broke.”

The Ministry of Industry and Information Technology said on Friday that it had dispatched a team to Shanghai to resume work in 666 key enterprises.

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SAIC Motor, China’s largest state-owned carmaker, will conduct a stress test on Monday before resuming production, according to an internal memo seen by the Post.

Shuichi Akamatsu, Japan’s consul general in Shanghai, wrote to Zong Ming, the city’s vice-mayor, last weekend and urged the municipality to address the concerns of Japanese businesses over losses and other disruptions caused by the lockdown.

Citing a survey by a Japanese chamber representing more than 2,300 businesses, he said that interrupted supply chains, difficulty in securing food supplies and an inability to make payments, including paying employees’ salaries, were the primary concerns among Japanese companies operating in Shanghai.

Shanghai’s small businesses, staff scramble to minimise lockdown losses

On Monday, the US Department of State ordered the departure of non-emergency employees and their family members from its consulate in Shanghai amid concerns about their safety and welfare.

In an open letter last week, the French consulate in Shanghai said that under no circumstances should parents and children be separated because of quarantine policies.

Bettina Schoen-Behanzin, chair of the European Chamber of Commerce’s (EUCham) Shanghai chapter, also wrote to Zong this month, lobbying for eased anticoronavirus controls to support European companies’ operations.

01:34

Shanghai vows punishment for lockdown violators as the city continues to fight Covid outbreak

Shanghai officially started a citywide lockdown on April 5, but nearly all major manufactures have been forced to halt production since April 1, when a de facto shutdown was imposed on the entire city.

Only a very small number of companies have been operating under the closed-loop system, where workers essentially sleep at work sites to avoid contact with outsiders. The lockdown has confined all residents to their homes. Public transport has been suspended while private cars are banned from taking to the streets.

Shanghai has yet to announce a time frame for ending its citywide lockdown.