Coronavirus: China’s small firms at risk while outbreak poses challenge to Beijing’s grand economic goals

As coronavirus dents Lunar New Year sales season, small firms in China worry about 2020 businesses outlook

Most small firms, a cornerstone of economic activity and jobs, do not have reserves to weather a major economic storm

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China’s small and medium-sized businesses are critical for the economy, but many are worried about the impact of the coronavirus. Illustration: Lau Ka-kuen

Published: 6:00am, 12 Feb 2020Updated: 4:39pm, 14 Feb 2020

Even 200km away from the epicentre of the deadly coronavirus outbreak, Chinese crab farmer Peng Guobing is feeling anxious about his business.

With the Lunar New Year holiday finished, his crab ponds should be empty, the small crustaceans shipped to buyers in Hubei’s provincial capital Wuhan or other major consumer markets across the country.

But like scores of other small business owners in China, the disease outbreak has turned his plans upside down.

The virus, which has claimed the lives of more than 1,000 people and infected more than 40,000 in mainland China, shows little sign of being brought under control.

On top of health concerns, the epidemic is sowing fear and uncertainty among tens of millions of small businesses, which are a cornerstone of the Chinese economy and essential to social stability.

China had 63 million “self-employed businesses” at the end of 2018, providing 150 million jobs, according to the latest economic census by China’s National Bureau of Statistics.

Peng said he was expecting heavy losses this season, as about two thirds of his crabs – or 10,000kg that sell for about 60 yuan (US$8) a kilogram – are stuck in his ponds.