China promotes return to normality - Slow recovery despite transport restrictions

03.18.2020 12:04 Economy

Our colleague and head of the Port of Hamburg Representative Office in Shanghai, Pan Hua, outlines the current situation regarding China’s transport economy and provides up-to-date information on production status, entry requirements, restrictions on the logistics sector and discusses the expected turnover for China-Europe trade.
All Chinese companies are subject to strict hygiene regulations. The quarantine-related production stops affect transport: in addition to domestic routes, rail and seaborne transportation between China and Europe have also been partially suspended. Currently, rail freight transport between China and Europe is running at 90 percent capacity, returning roughly to the previous year’s level.
The number of new cases of coronavirus infections has dropped considerably in China. Increased monitoring at travel centres and 14-day quarantines are intended to limit the threat posed by returnees. Quick-tests for the coronavirus at Shanghai airport allow business trips of up to one week and, in addition to containing the epidemic, allow a return to work. Chinese economy has withstood the upheavals of COVID-19 in January and February, the national statistics authority announced on Monday. Production levels in some Chinese companies are already at 70 to 80 percent and some are operating at full capacity again. Even in the Province of Hubei, production is gradually picking up. There are still difficulties concerning supply chains. Chinese ports have reduced their port dues by up to 20 percent.

From January to February, China's industrial production declined by 13.5 percent compared to the previous year. Retail sales and capital expenditure also dropped by 20.5 and 24.5 percent respectively compared to the previous year. China expects a decline in economic output for the first half of 2020. The decline could be compensated by an increased demand from other countries, depending on their individual health status and demand.
Overview Blank Sailings
 Alphaliner reports that, after the Chinese New Year, 33 sailings between Asia and Northern Europe were cancelled during calendar weeks four to eight. For calendar weeks nine to the current week twelve, Alphaliner expects 17 cancellations. A reduction by 700,000 TEU was estimated for the Asia-Europe route in the eight weeks since the end of the Chinese New Year. For the same period last year, the reduction was only 340,000 TEU; for the same period in 2018, the reduction was around 210,000 TEU. China's ports are currently returning to normal and the shipping companies are beginning to recall individual cancellations.

You can also find up-to-date information on how the individual market regions are affected on the German Chamber of Foreign Trade’s webpage


China promotes return to normality - Slow recovery despite transport restrictions

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      Bengt van Beuningen

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