MILAN, Feb. 25 (Class editori) -- Yesterday the turning point has been reached in China, exactly one month after the outbreak of Covid-19; in the meantime, an explosion of contagion cases in Italy has been recorded. Regardless of the different dimension of the populations, the difference is that in China the suspension of the activities on the occasion of the New Year’s celebrations has cushioned more risks of those which have been recorded as infection cases or deaths, even if they have been very high.
Last week, the central government and the local authorities invited the workforce to come back to production sites because, without them, the recovery would have been impossible. This decision is in line with the positive opinion expressed by the WHO, during the press conference held in Beijing last Sunday.
Some municipalities are paying the transportation costs for the workforce coming from different districts. In other cases, the costs of the transportation requested by the company are paid by the company itself. A possible consequence is that, once the workforce has come back, the enterprise will not be able to resume production activities because supply companies have not restarted activities yet or due to the lack of personnel or the non-approval by the Authorities.
The two areas in which production activities are mostly located, namely Yangtze River Delta near Shanghai and Pearl River Delta near Canton, are suffering because of these inconsistencies: the reduction of quarantine measures in Canton from 14 to 5 days is inexplicable, when the company organizes for its own workforce a direct transportation without taking advantage of public transportation means.
The procedure of monitoring and control is extremely strict: all the workers who have come back have the obligation to supply their own information through an official app, so that their moves can be monitored, also taking into account the temperature measurement once or more times a day. As already explained, in case of a contagion case, the trend is to transfer the total responsibility of the management of the personnel to the company, both by local authorities and by the owners of the buildings used as offices.
The document I have received today by the owner of the office is requiring the signing of the following statement: “our company needs to keep the promise of the above mentioned commitments and it is available at taking all the responsibilities”.
In this situation, enterprises with a turnover of more than 20 million of RMB (about €2.8 million) were ordered to open again with a significant portion of additional costs. During the last weekend shopping malls and public spaces have been re-opened in the city centre and today some provinces such as Jangsu, part of the Yangze River delta, have reduced the warning rate from 1 to 2 or even 3 (in China the value scale is reversed)
Port Authorities, including that of Xiamen, which is an important production centre of sportware and marble, yesterday evening have decided to operate a reduction in port costs addressed to enterprises and shipping companies; the latter are suffering from this production stoppage and are keeping to postpone ships departures.
In order to ensure the flows, some provinces such as Zejiang have resumed – willingly or not - 90% of their activities according to Government esteems, meanwhile others are following this path. Also banks, including the Agricultural Development Bank and the China Development Bank, are developing intervention plans in the agricultural sector.
The Central Government is aiming at reaching 6% of GDP annual growth and in order to contribute to this result 67% of steelworks and 76% of mining operations have started again, according to official data. Meanwhile also Volkswagen and Toyota have communicated the production restart, Japanese people in their four factories and VW in both direct factories as well as in JV with Faw.
It is important to claim that the Research Centre on Energy and Clean Air based in Helsinki has recorded that in China, during the ten days following the first recovery of February, 3, the air dioxide level has decreased by 36% and the industry output has dropped from 15% to 40% with a CO2 reduction of hundred million tonnes, compared with the same period in 2018.
Problems concerning the recovery have been discussed also in the second edition of the videoconference held last Thursday by the Italian Chamber of Commerce in China, which has been attended by the Ambassador Luca Ferrari.
Among the present speakers, who have provided reflection insights supported by specific data related to the consumption projections on Chinese market and the potential loss of market share, Gianpaolo Bruno, Director of the ICE of Beijing, has underlined how among the production activities addressed to our export towards different countries, €9 billion are regarding components and semi-finished products which have been produced in China.
These data are confirming, once again, how the global supply chain may be essential in this organization of production worldwide, but also the potential contradiction between environment and production: another situation which needs to be solved in the following five years.
* Managing Director at Savino Del Bene – transport and logistics company. He lives and works in China since over 25 years.
(Source:Class Editori)
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