Shanghai Unveils Business Restart Plan on Supply-Chain Woes

Shanghai has asked businesses to formulate plans for closed-loop management, where workers live on-site and are tested regularly.

Shanghai Unveils Business Restart Plan on Supply-Chain Woes
Sparks fly as a worker supervises the flow of hot liquid metal as it flows from a furnace. (Photographer: Andrey Rudakov/Bloomberg)

Shanghai published plans to resume work in the city after weeks of Covid-19 lockdown snarled supply chains and dealt a blow to the Chinese economy.

Businesses should formulate plans for closed-loop management, where workers live on-site and are tested regularly. They should also apply for approval to restart production with Covid-control authorities, Shanghai’s Economic and Information Technology Commission said in a statement on its WeChat account. The agency did not provide a timetable.

The lockdown in China’s financial hub, now in its third week, has squeezed everything from consumer spending to logistics and production. The key to addressing the economic woes is adjusting China’s Covid Zero policy, analysts said, as the Chinese central bank takes a cautious approach with monetary easing. Top officials have repeatedly warned about risks to growth and the need for more monetary and fiscal stimulus.

Shanghai Unveils Business Restart Plan on Supply-Chain Woes

Shanghai is a production base for many companies, including Tesla Inc. and China’s state-owned SAIC Corp. Tesla is calling back its workers in the city to prepare for the initial resumption of production as soon as this week, Bloomberg has reported

Another automaker, China FAW Group Co. has resumed operations at its five plants in Changchun, the capital of Jilin province, local officials said at a briefing Sunday. Some 276 auto component suppliers have also gotten back to work, they added.

The northeastern province, an automaking and agricultural hub of 24 million people, went into lockdown about a month ago. Community spread in all of Jilin’s cities has been halted, with new cases only reported among people already in isolation, state television reported Thursday, citing local officials. 

Shanghai recorded 24,820 local Covid-19 cases for Saturday, 21,582 of them asymptomatic. Of Shanghai’s 849 sizeable vegetable producers, 667 have resumed work, Lu Zhengrong, an official with the Shanghai Agriculture and Rural Affairs department, said at a briefing on Sunday. 

Under the new work-resumption plan, different parts of factories must be separated, and all staffers should work and live in designated locations, reducing direct contact with people in other areas as much as possible, according to the statement.

Visitors will be tightly restricted, and company truck drivers must provide negative nucleic acid test results within 48 hours or a negative antigen test within 24 hours, before entry. Makeshift hospitals should be set up at firms with a large number of workers, according to the statement.

Shanghai has set a target to stop the spread of Covid-19 outside of quarantined areas by Wednesday, Reuters reported, citing people it didn’t identify. The goal will require officials to accelerate testing and the transfer of positive cases to quarantine centers, the news agency said, citing a copy of a speech by a local Communist Party official dated Saturday.

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With assistance from Bloomberg