By Mahua Venkatesh New Delhi, Nov 30, 2018: With the emergence Omicron variant to Covid 19, concerns and uncertainty have increased for the 44 million small and micro businesses in China.The new variant could again cause supply side problems, with many countries closing their borders.
A large number of these small businesses exports, which is notable.
Beijing had already begun closing down parts of the country following the resurgence in cases, even before the Omicron variant of Covid 19 was released.
These SMEs now face more challenges with the new Omicron variant of Covid 19.China is likely to impose further restrictions.
Even authorities warned that this could make it difficult to host the Winter Olympics in February.
South China Morning Post reported that China’s Vice-Premier Liu He stated at a recent forum that “SMEs are the mainstay market and the main source for jobs.” He stressed the importance of the authorities supporting the development and growth of SMEs.
These small businesses not only generate around 80 percent of the country’s non-government jobs, but they also account for approximately 60% of the country’s GDP.
Many SMEs had to be closed down permanently due to the Covid 19 restrictions, but many of these units were able and willing to reopen.”Exports had also opened up, and these businesses were on their way to a healthy recovery, but with this new virus and China’s strict measures have caused tension among small business entrepreneurs,” India Narrative was told by a promoter of small business that has a factory in China.He spoke on condition of anonymity.
These businesses located in rural areas are most affected.
“As these units are facing unusual challenges, employment generation could slow down, especially in light of the pandemic,” the promoter said.
Added to their problems are the ongoing shipping congestion and a shortage of containers.
Global shipping snarls, which include port congestion and soaring shipping prices, have also been a challenge to SMEs, eating into profits, and delaying orders.SCMP stated that business owners reported having difficulty booking containers for their goods because of a global shortage.
Despite Beijing taking many measures to support this vital sector, these units were already feeling the effects of the government’s crackdown on the private sector as well as other industries like education and technology.These units have suffered more than larger businesses due to rising raw material costs and power shortages.
Statista, a data collation portal, estimates that China adds approximately five million SMEs each year, which represents a minimum of ten percent annual growth rate.
In 2017, Beijing alone had more than 3,100 industrial SMEs that generated an annual revenue of over $2.8 billion.
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–indianarrative
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