What’s new: Business disruptions caused by Covid-19 lockdown measures dragged down Shanghai’s industrial output by 7.5% in March from last year, the first decline in two years, according to a senior city official.
First-quarter industrial output rose 4.8%, compared with 34.5% growth recorded in the same period a year ago, said Wu Jincheng, director of the Shanghai Municipal Commission of Economy and Informatization, at a Friday briefing.
The city government is pushing for resumption of production by local businesses and promised to offer rent deductions to small and private businesses in the city, officials said.
About 70% of the 666 companies listed by the city for prioritized business resumption have restarted operations, said Deputy Mayor Zhang Wei at the event.
The context: Strict lockdown measures to contain an outbreak of the omicron variant of Covid have taken a heavy toll on Shanghai’s economy as plants were forced to halt or reduce production and most of the city’s 25 million people were confined at home. The disruptions are rippling nationwide given Shanghai’s status as a key commercial and industrial nexus.
On April 18, Shanghai issued a list of manufacturers that could potentially resume operations — with workers in a strictly enforced bubble — as the city enters its fourth week of lockdowns. The companies on the list include major automakers and semiconductor producers.
Automakers including Tesla Inc. and SAIC Motor have restarted production lines since April 19, officials said. Leading chipmakers Hua Hong Semiconductor Ltd. and Semiconductor Manufacturing International Corp. are running near full capacity.
Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bob.simison@caixin.com)
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