While most of the world moved towards normality in 2021, it was obvious that China would be doing things differently. Instead, their zero-Covid policy challenged many Chinese manufacturers and made dealing with China difficult for western businesses.
This article describes how Chinese manufacturers are coping with the ongoing restrictions and how China plans to continue trading in the future.
Chinese Manufacturers and Covid
Because of low manufacturing costs and the opportunities for mass-market products, China has always appealed to western businesses. When businesses choose Chinese manufacturers, they are free to look after development, expansion, and research. Many western companies need sourcing agent in China to ease the process of finding a reliable manufacturer.
Chinese manufacturing has slowed in 2022. Shanghai, China’s economic hub, showed some signs of recovery, but the pace has been slow, and steel demand is sluggish.
The sectors of steel-related manufacturing all showed a decline in monthly and yearly figures. Machinery, vehicle production, shipbuilding, home appliances, and power-generating facilities all suffered adverse downturns.
Vehicle production has had a 44% fall since 2021. Shanghai and northeastern Jilin city produce about 11% of China’s vehicles. Sha\nghai and Jilin saw production disruption as well as countrywide supply chain problems.
In July 2022, China’s manufacturing industry unexpectedly decreased as sector disruptions were once more blamed on Covid. The severest contraction was in energy industries like coal, petrol, and ferrous metals.
However, China’s resilient supply chain structure and buoyant manufacturing base continue to promote growth in key manufacturing areas.