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Shanghai
BusinessChina Business

Shanghai lockdown: most shops and restaurants remain shut, as stringent Covid-19 rules make normal operations impractical and beyond reach

  • As few as 5,900 businesses are on a ‘white list’ that’s been approved to resume operations under strict Covid-prevention conditions
  • That’s a mere 0.2 per cent of the 2.67 million businesses registered in China’s commercial hub

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A shopping center along a near-empty street under lockdown due to Covid-19 in Shanghai on May 5, 2022. Photo: Bloomberg
Yaling JiangandDaniel Ren

Shanghai’s road towards business recovery remains long and windy, as the vast majority of small retailers, restaurants and service providers are still awaiting the government’s green light to reopen.

Municipal authorities are technically allowed to approve businesses to resume in low-risk areas that had been declared Covid-free in the past 14 days, as the prelude to a formal citywide reopening scheduled on June 1 before the city returns to full normality by the end of June.

In reality, few approvals have been issued. As few as 5,900 businesses are on a so-called “white list” that’s been approved to resume operations under strict Covid-prevention conditions, a mere 0.2 per cent of the 2.67 million businesses registered in China’s commercial hub, according to data provided by Shanghai’s government.

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The hiatus, now approaching the third month for some of the worst-affected companies, has taken a crucial quarter out of earnings and is driving many to the brink of collapse. Local authorities earmarked 140 billion yuan (US$21 billion) of tax relief, incentives and subsidies as lifeline in late March before locking down the city of 25 million residents on April 1.
A worker on the Lingang assembly of China’s largest state-owned carmaker SAIC Motor, operating at a portion of its installed capacity in Shanghai on April 23, 2022. Photo Xinhua
A worker on the Lingang assembly of China’s largest state-owned carmaker SAIC Motor, operating at a portion of its installed capacity in Shanghai on April 23, 2022. Photo Xinhua

“We are desperate and hopeless, after shutting down for nearly seven weeks,” said Zhao Heng, who manages a mini supermarket called Master on Lancun Road in Pudong district. “Chances are slim that the store could make a single coin of profit this year.”

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