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TechPolicy

China’s e-commerce industry hit as delivery and live-streaming hub Yiwu enters second week of citywide Covid-19 lockdown

  • A representative for Cainiao, Alibaba’s logistic arm, said it was storing newly-arrived products at its Shanghai warehouse to keep operations running smoothly
  • Before the latest Covid-19 outbreak, the Yiwu government had been making efforts to reconnect with overseas buyers from Pakistan and India

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A worker packs Christmas ornaments on the production floor of a factory in Yiwu, China, Oct. 19, 2021. Photo: Bloomberg
Tracy Qu

China’s e-commerce hub of Yiwu, a key sourcing centre for low cost goods, continues to cause disruptions to trade flows after thousands of e-commerce merchants suspended deliveries when the city went into a Covid-19 lockdown just over a week ago.

One out of every 10 parcel deliveries in China in July came from Yiwu in eastern Zhejiang province, according to government data, but that dried up in early August because of an outbreak of the Omicron variant. Local authorities issued a notice on August 4 asking residents not to leave the city, and a week later a strict citywide lockdown was imposed, halting virtually all delivery traffic.

Yiwu-based merchants on Taobao, Alibaba Group Holdings’ Chinese shopping platform, said on Friday that the city suspended the express delivery system about one week ago, and that they are waiting for a notice of approval to resume shipments.

Alibaba owns the South China Morning Post.

On Chinese microblogging platform Weibo, users are complaining that their packages have been held up for weeks. “My mom asked me why she hasn’t seen the slippers that I ordered. I told her they are under quarantine in Yiwu,” one user wrote.

A representative for Cainiao, Alibaba’s logistics arm, said the company was storing newly-arrived products at its Shanghai warehouse to keep operations running smoothly. At its bonded warehouse in Yiwu, all employees are under quarantine at home following the Covid-19 control measures, the representative said.

Jakarta-based J&T Express said it has started processing the backlog of parcels in Yiwu. An employee at J&T in Yiwu, who declined to be named, said only a few pickup stations have reopened, with the majority still in “silent mode”.

ZTO Express, STO Express and SF Express did not immediately respond to a request for comment.

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