Hong Kong manufacturers struggle with ‘blackouts’, rising producer prices in mainland China
- Factory orders have returned to about 70 to 80 per cent of pre-pandemic levels, the Chinese Manufacturers’ Association of Hong Kong says
- But Hong Kong firms on the mainland have been beset by high commodity prices, electricity cuts and hiring difficulties
As China pushes to maintain its central position in the global supply chain, Hong Kong funded-firms are being hit by new challenges on the mainland, including power shortages and skyrocketing production costs, according to an industry group.
China’s domestic demand and exports continue to recover from the coronavirus pandemic, with factory orders at about 70 to 80 per cent of pre-pandemic levels, Allen Shi Lop-tak, president of the Chinese Manufacturers’ Association of Hong Kong, said on Wednesday.
“Orders have not been bad, they are being taken as far out into next year. But the new difficulty for those of us with factories on the mainland is the power shortage problem,” said Shi. “There have been blackouts in several regions that have lasted about a day or two. This is very worrying as business improves.”
State-owned electricity grid operator, China Southern Power Grid, said on Wednesday peak-capacity demand had been at record levels over the past three weeks due to a combination of high temperatures and brisk economic activity.
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This has caused power rationing for two days a week in some areas, forcing owners to keep factories running at weekends or resort to diesel generators to maintain production.
