The COVID-19 epidemic has re-emerged in Shenzhen, Guangdong Province, China, further worsening the supply chain disruption in the country.

According to mainland media, the top 100 businesses in Shenzhen have been ordered to shutter for seven days starting from July 24. Among these companies are Huawei, ZTE, SMIC, Foxconn, and others. 

The industrial park where they are located has a special PCR testing site, and their employees are required do Covid tests every day. They must hold a negative test certificate within 24 hours before they can work.

When the Covid outbreak returned to Shenzhen in March, some companies implemented a closed operation mode in effort to coordinate the epidemic prevention with safe production.

When Shanghai locked down the city at the beginning of this year, some companies also tried to maintain the operation through the closed mode.

However, many companies have faced difficulties from the Covid containment measures from the authorities.

Zheng Yuhuang, a professor at Tsinghua University, once revealed that in the first half of this year, 460,000 companies across China closed down. 

Additionally, more than 3 million individual industrial and commercial households have suspended their businesses.

A study by the Imperial Data Bank of Japan found that there were more than 12,700 Japanese companies operating in China as of June 2022, the lowest number within the past 10 years.

Some of China’s supply chain have been disrupted due to the Covid epidemic, the country’s lockdown measures, coupled with the international community’s decoupling from China.

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