Mere months after widespread covid lockdowns in Shanghai disrupted supply chains and forced manufacturers to halt operations, China is again seeing an uptick in factory shutdowns.
This time, the culprit is not the coronavirus, but an intense heatwave and drought across China’s south, around the Yangtze river basin. Water levels behind dams are depleting, curbing electricity generation at hydropower plants, just as air conditioning demand is spiking.
To prevent power outages, authorities in Sichuan province—which relies on hydropower for about 80% of its energy needs —have ordered factories to halt operations.
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Data from Everstream Analytics, a supply chain data and risk analytics provider, show a sharp rise in factory shutdowns in China over the past week. As of Wednesday (Aug. 17), Everstream had recorded 39 closures—more than double the previous week’s total, even though the week was just half-over.
Read more: QZ
