A Totally New Chinese New Year

Written by Andrea Rossi

Founder and CEO of ICS | I Choose Shenzhen

02/03/2021

An unprecedented economic rebound.

Only a week to go before the big break for the Spring Festival, the Chinese New Year. A year ago, the world’s second largest economy announced to be the victim of a potential epidemic to the whole world. The first cases of Coronavirus put the Asian giant’s production in serious difficulty, which saw production drop by about 90% in the two months immediately following the announcement to the World Health Organization. A year later, close to the holidays, China is back to 90% of its pre-coronavirus production.
This year, as cases rise again, some workers are not able to go back to their hometowns, but many Chinese factories will work at full capacity and not only thanks to personal protective equipment such as masks, coveralls and gloves.

Holidays will be spent far from hometowns.

Analysts foresee a rise in Chinese trade by more than 10% in 2021. It is clear that the country is facing an unprecedented challenge, with the clear goal to achieve global economic leadership within 5 years.
But what is happening these days in many Chinese factories?
Many migrant workers, during the Spring Festival, will remain in the cities where their factories are, which means no reunions with their families. Factories motivate them to stay with a bonus for the month traditionally dedicated to celebrations.

The attempt by the central government to discourage travel is evident, in such a way as to generate a reduction in mobility, which would increase the risk of the epidemic comeback.

Local councils promptly responded to these rules, adopting solutions in line with the policy dictated by the government.
However, the incentives are not solely economy-related. It is interesting to note how many cities, including the industrious Foshan, have provided for celebrations and the release of consumer vouchers, as well as free entry to places of attraction, for those who will not move from the city where their factory is.

A small revolution, if we consider that comes Chinese New Year all factories are closed for at least two weeks, and up to four weeks. This year, productions will not suffer the usual slowdowns. The shortage of manpower will be contained and the production plants will most likely guarantee unexpected levels of production, although not at full capacity, for the owners and managers voted to the cause of a tireless and ambitious China.
On one side, China had to face a sudden slowdown related to exports back in February and March, which is the real engine of the Chinese economy. On the other side, 2021 makes up for it with this new trend, which describes a renewed euphoria for the expectations of an apparently unstoppable country.

A new awareness.

Already in 2020, China demonstrated resilience to the enormous pandemic issue by focusing on exports of medical materials. Between March and the end of December last year, China exported 224.2 billion face masks. A figure indicative of the productive power of what will continue for a long time to be the factory of the world, in spite of some rash declarations by former presidents accused of impeachment and by careless South American caudillos.

Now, we are on the eve of a new mass exodus, certainly pervaded by a new spirit: the one of the new China desired by Xi Jinping, still attentive to family, loved ones and solidarity at home. But of course, projected towards the challenge clearly drew since the time of Mao: to oust the United States from the first position in the world economy.

Perhaps the virus has accelerated the time of a new awareness. They cannot stop. And never mind if the Chinese will have to share dumplings with the neighbors at the factory this year.

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