The influence of Shanghai’s lockdowns on global supply chains

Qilai Shen/Bloomberg

Under the epidemic, war, the hiking of Fed funds rate, inflation, and economic recession in the environment, the global supply chain is undoubtedly a huge engine of world economic growth, and Shanghai is one of the cores of this engine because of the considerable influence and essential role.

The lockdowns in Shanghai started on April 1st, and gradually lifted from June 1st. During this 60-day period, workers who are unable to leave their homes or communities, cannot return to work; logistics prices have risen several times because many drivers have been isolated; the stock of raw materials has been unable to support production, because of logistics problems.

Since the beginning of April, the number of container ships waiting at the port of Shanghai and the nearby port of Ningbo Zhoushan has more than doubled, almost three times as much as a year ago.

Modern enterprises are large-scale collaborative upstream and downstream. If a few companies in the supply chain are unable to supply, the supply chain will be broken. Therefore, the impact of lockdowns is not only in Shanghai, nor is it only in the Yangtze River Delta region, but global.

Tianqi Shi

Tianqi Shi is a master’s student majoring in Economics and Education at Columbia University. She has rich intern experience in the Investment bank department and the Investment research department. She focused on the capital market and provide deep insight into investment.