China Lockdowns: Shanghai Factories Allowed to Reopen if ‘Workers Live On-Site’

Workers make pods for e-cigarettes on the production line at Kanger Tech, one of China's l
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Shanghai on Saturday issued an edict allowing local factories to resume production — which had been halted in recent days due to a city-wide Chinese coronavirus lockdown — as long as “workers live on-site,” China’s state-run Global Times reported Sunday.

The Shanghai Municipal Commission of Economy issued the back-to-work notice on April 16 and included specific anti-epidemic guidelines for all district governments and authorities to follow while resuming operations at Shanghai factories.

“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-19 [Chinese coronavirus] control authorities at the district and city levels,” the press release read.

While the Global Times reported that Shanghai’s government issued the back-to-work edict on April 16, a separate report by China’s official state press agency (Xinhua) suggested the order was issued sometime earlier. Xinhua revealed on April 17 that at least one of Shanghai’s major manufacturers, the Taiwan-based Quanta Computer Inc., had already resumed limited operations on April 15.

“The Quanta Shanghai Manufacturing City on Friday [April 15] resumed production with about 2,000 staff members working under closed-off management,” the news agency reported, referring to Quanta’s manufacturing “city” or base within Shanghai’s Songjiang district.

“Production at the F1 and F3 factories, which make laptops for Apple and accessories for Tesla respectively, is now underway,” Xinhua relayed.

Quanta’s factory base in Shanghai includes eight plants and more than 40,000 employees.

SAIC Motor, China’s largest automaker, planned to re-start production at its Shanghai manufacturing facilities on April 18, according to the Global Times. SAIC Motor is the Chinese partner of the German automaker Volkswagen and American automaker General Motors.

The U.S-based electric vehicle company Tesla Inc. “began preparing to reopen their Shanghai factories on Monday [April 18],” Reuters reported.

“Tesla has recalled workers to its factory to prepare for the restart,” the news agency revealed, citing the accounts of two unnamed company sources.

The sources told Reuters that, “while the U.S. automaker had initially intended to resume one production shift on Monday [April 18] it was now looking to do so on Tuesday [April 19] … because a supplier was facing issues with logistics.”

The Global Times on April 17 acknowledged Shanghai’s factory resumptions would only allow for limited production capacities. The Communist Party-run newspaper admitted this was not only due to the resticted number of workers permitted to return to work at the sites but also due to the “logistical” issues alluded to by Tesla on April 18.

“For any manufacturers planning to resume work in Shanghai, if they cannot have access to quick supplies of upstream components and raw materials, simply gathering workers in the factory area won’t be enough for them to return to operational normalcy,” the publication observed.

“[L]ogistics remain a severe problem for many factories near Shanghai and along the Yangtze River Delta, and this will block the transport of some raw materials to Shanghai, preventing production capacity from being fully restored,” a Shanghai-based auto parts supplier identified only by his surname, Zhang, told the Global Times on Sunday.

Shanghai is China’s top financial hub. The city houses both the world’s busiest shipping container port and hundreds of manufacturing plants run by multinational companies. All of Shanghai’s roughly 26 million residents have been under lockdown to contain the city’s latest outbreak of the Chinese coronavirus since April 5.

China’s southeastern tech hub of Shenzhen, which shares a border with Hong Kong, similarly allowed only some factories to resume production in mid-March during a period of  city-wide lockdown if they practiced a so-called “closed-loop management.” This meant asking workers to “eat, sleep and work in bubbles isolated from the wider world, sterilising premises as often as three times a day and testing for COVID [Chinese coronavirus] daily,” Reuters reported on March 17.

“Apple supplier Foxconn said it was able to restart some production at its campus in the southern tech hub of Shenzhen after it put such an arrangement in place,” the news agency confirmed at the time.

“Foxconn said it could only apply the bubble on campuses that included both employee housing and production facilities,” Reuters noted.

China’s ruling Communist Party has infamously treated factory workers within the country’s westernmost region of Xinjiang poorly, as the majority of such laborers are members of the Uyghur central Asian ethnic group. The Uyghurs are a Turkic-speaking, largely Sunni Muslim minority. The group, along with similar ethnic minorities in Xinjiang such as Kazakhs and Kyrgyz people, have been forced to work in Xinjiang factories under slave labor conditions since at least 2017, with many funneled into further slave labor at factories within major Chinese cities. The Australian Strategic Policy Institute reported on the phenomenon in a March 2020 analysis titled “Uyghurs for Sale.”

“[L]ocal governments and private brokers are paid a price per head by the Xinjiang provincial government to organise the labour assignments [for Uyghurs, Kazakhs, or Kyrgyz people],” the report revealed.

“A local government work report from 2019 reads: ‘For every batch [of workers] that is trained, a batch of employment will be arranged and a batch will be transferred. Those employed need to receive thorough ideological education and remain in their jobs,’” according to the institute.

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