China’s largest city, Shanghai, will end its COVID-19 lockdowns on Wednesday this week, and doing so could ease some of the problems in global tech supply chains.
Limited shutdowns began in Shanghai in mid-March, before escalations in April imposed citywide restrictions that have remained in place ever since.
Shanghai is a major manufacturing hub, so the shutdowns have caused considerable pain. Cisco, for example, Cisco has warned of a disruption in the supply of parts it needs for power supplies. Companies like Foxconn, Tesla and Toyota have all ceased or slowed production. Chinese chipmaker SMIC has kept production going by having staff move either to its factories or to a COVID-free zone around its factories.
Shanghai city authorities now say they have controlled the spread of COVID to their satisfaction and are happy the city is reopening with some restrictions in districts that have gone 14 days without detected infections.
At a press conference on Sunday, officials said 1,700 “key production-oriented enterprises in the region have resumed work and production,” as have 450 key financial institutions and 580 key foreign trade enterprises.
Local shops and malls are slowly reopening and many public transport services have resumed.
Municipal authorities also saw fit to mention that 88% of e-commerce warehouses have resumed operations.
Shanghai administrators also announced subsidy programs for industries, including software development. Another stimulus initiative is free or low-cost broadband services for SMEs. Some SMEs will be eligible for free software which it is hoped will accelerate their digital transformation efforts.
The city government even hopes the shutdowns will see businesses accelerate the development of digital pandemic management tools.
Shanghai’s reopening will be welcomed around the world, but perhaps even more so in China, as the country’s economy has suffered in 2022 as lockdowns hurt local e-commerce giants JD and Alibaba. Smartphone demand plummets in 2022, data shows [PDF] from the Chinese Academy of Information and Communication Technology.
The Shanghai lockdowns have also challenged the Chinese government by generating dissent which has been quashed by preventing the use of certain hashtags which have become popular expressions of frustration with the gravity and provision of support as the city was under strict control. This content has of course been removed where possible. ®