In Dongguan, a city synonymous with China’s status as the “world’s factory,” a sprawling network of factories remained quiet Tuesday as virus fears, wide-reaching lockdowns and official reluctance kept workers off production lines.
Beijing ordered the country back to work this week, seeking to ease the economic blow of the strict measures taken to contain the spread of novel coronavirus pneumonia, which began to infect people in the city of Wuhan and has now killed 1,017 people in China.
On Tuesday, the Ministry of Industry and Information Technology said its top priority “is to promote the resumption of production.” President Xi Jinping has warned top Communist Party leaders that the measures taken against the virus were doing economic harm, Reuters reported.
But in the Tianxin No. 1 Manufacturing District, a cluster of factories in Dongguan, there were no signs of life Tuesday. The Globe and Mail called 32 manufacturing companies in the district. Four said they were closed. Phones rang unanswered elsewhere.
“I don’t know anyone that is open,” said Meng Xin, who works at the Taixin Rubber and Plastics Production Factory, which makes plastic and metallic bubble bags.
“The biggest difficulty is workers. Workers can’t come back at all,” Mr. Meng said. Those in rural areas struggled to find cars or trains. In hardest-hit Hubei province, roads, rail and air travel remain shut down.
But in cities and villages across China, the imposition of local epidemic measures has effectively placed people under medical house arrest, with households permitted to send out a single person to buy necessities once every two or three days. And a mishmash of different local policies means travellers allowed to move in one place risk being stopped elsewhere.
China’s most respected epidemiologist, Zhong Nanshan, told state media and foreign journalists Tuesday that the country has not yet reached the apex of the viral outbreak, which could come as soon as this week or perhaps closer to the end of the month. The number of new daily confirmed cases, however, has trended downward for several days.
The state-run Xinhua news agency said “millions” had returned to work Monday. It showed employees entering a Lenovo office building, as well as footage of a communications equipment factory operating in Shenzhen. An employee at a factory in Anhui province said people were working overtime to make up for colleagues unable to return to work. Eighty per cent of software and IT businesses are operational again in some form, state media reported, but more than two-thirds of employees are working from home.
Manufacturers, however, don’t have the luxury of remote work, so the resumption of full production has been rolling out slowly across China. At Magna International, the auto-parts manufacturer, “several of our plants resumed work” Monday, said Tracy Fuerst, the company’s Michigan-based vice-president of corporate communications. But no one answered the phone at eight of Magna’s plants in China on Tuesday, including those in Shanghai, Chongqing, Changshu, Changzhou, Kunshan and Suzhou.
Digital migration trends tracked by Baidu, China’s leading internet search engine, show that since Jan. 23, post-Lunar New Year travel across China is at least two-thirds below what it was last year. The country has simply not seen the huge spike in travel that would signal a mass return to work.
The spread of the virus to every region of China has provoked a state of near panic. Authorities in some of the country’s most vital economic areas have been loath to allow people to return to work out of fear commuting and workplace proximity will create new outbreaks.
In Foshan, the Guangzhou district ordered companies not to restart operations until March 1, threatening them with severe punishments if they undermine epidemic prevention efforts.
In Dongguan, authorities issued 20 directives governing the resumption of work. They include requirements for workplace sanitation; travel background checks for returning employees; strict health monitoring; staggered starts; and 14-day isolation for anyone who has been in areas most affected by the virus.
“Given the seriousness of the situation, we don’t dare let workers return now and gather together at work. That’s a risk we can’t afford,” said Wang Lin at the Weicheng Hardware Electronics Factory, which does electronic assembly and wire-electrode cutting.
Even companies eager to reopen cannot without local government inspectors first authorizing health measures at factories before they can resume work. Factory representatives who spoke with The Globe said authorities have given no indication when those inspections will take place.
Beijing has ordered banks to lend money to some companies at favourable rates and has injected more than $300-billion in additional liquidity to combat financial damage from the virus, as foreign analysts predict a painful blow to the country’s GDP. The outbreak has “completely changed the dynamics of the Chinese economy,” analysts at JPMorgan wrote. Some companies have already begun laying off workers.
“The economic losses are huge. I’ve lost large numbers of orders,” said Li Yongyan at the Baiqiang Mold Factory in Dongguan, which makes computer keyboard components.
He predicted “the bankruptcy rate will hit 10 to 15 per cent."
“I already know two companies that will halt business soon just because of the effects of the epidemic," Mr. Li said. "The whole industry has suffered from last year’s trade war. Now the virus is just adding to our challenges and our pain.”
With a report from Eric Atkins
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