Post Pandemic COVID policy of China – A Blockage for Supply Chain

COVID-19 turned the world upside down. It changed many lives, lifestyles, and a country’s economy. One such country that faced a huge loss is China. During COVID-19, the governments of a few countries issued “Zero COVID” policies for managing pandemics. Even after two years, it is still being followed, affecting the country’s economy and supply chain management.

There is a 2.5% reduction in GDP within three months of its duration due to the Zero COVID policy. These policies shut down casinos, a significant loss for Macau in China.

In an interview, Tommy Wu reported that “Second Quarter GDP growth showed no profit outcomes even after the post-pandemic pandemic in Shanghai, which had a severe impact on the country.”

Steve Morrison, senior vice president at the Center of International Studies, reported, “Zero-Covid is the major drive for the recession of the market globally.”

One of the victims, a Chinese fashion brand, announced a significant loss due to the downturn. It faced a 35% drop in Chinese sales due to COVID norms by the Chinese government. However, the reopening of many stores in June is a bit encouraging.

The report of Chinese economic performance was a little bit better in the month of June after a lockdown where the downturn in real estate stayed worse.

A senior market analyst, Halley, announced that, as per his analysis, there were some positive spots in the economic performance of China. But he was worried about the unemployment rate in China, which had been reduced to 3.5% with a worse GDP. He believes financial markets will gradually adjust and shape the Chinese economy.

Improvement Rate of Chinese Economy

The improvement of the Chinese economy won’t be at a faster pace as the government of China is still demanding its Zero COVID Policy. On the other hand, China forced many companies to work within a closed loop system, which also led to disruptions in supply chains.

With a zero COVID policy, China is currently unpredictable in business, trading, and supply chains.