Its often called the world’s factory, and its at least partially closed. This Monday, millions of Chinese workers returned to work, after authorities prolonged the lunar new year holiday, in an attempt to contain the coronavirus.
But, a large number of factories will still have their doors shut. Analysts warn, the economic impact could hit global supply-chains.
Some provinces have told companies not to resume operations until the first of March. Foxconn, which is a major supplier to Apple, hasn’t actually yet opened its biggest Chinese factory.
A number of carmakers, including Toyota and BMW, are extending the shutdown until next week. Hyundai is one company that has already had to hold production outside China, because of shortage of parts due to the coronavirus.
Renault also plans to suspend production at its plant in Busan, South Korea, because of disruption to its supply-chain.
Beijing is hoping to reassure investors with almost $130 billion injection, to kick-start the economy. But the longer the epidemic drags on, the greater the impact on the country’s growth.
In the most optimistic scenario, when the coronavirus comes under control by the end of the month, China’s GDP could grow by up to 6 percent. If, what is most likely, the outbreak is controlled by the end of March, the country’s growth could dip to 5.5 percent.
The virus has also gouged the country’s tourism industry, and small businesses have particularly suffered.