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COVID restrictions have caused 93 percent of US companies in Shanghai to lower their revenue expectations, according to a poll

Image: Reuters Berita 24 English -  The American Chamber of Commerce (AmCham) in Shanghai reported on Wednesday that over 90% of US multinat...

Image: Reuters

Berita 24 English -  The American Chamber of Commerce (AmCham) in Shanghai reported on Wednesday that over 90% of US multinational enterprises questioned have lowered their yearly revenue predictions as a result of the city's gruelling two-month lockdown.

AmCham Shanghai surveyed 133 member companies, and 93 percent stated they had lowered their revenue forecasts for this year, with a quarter expecting a decline of more than 20% from previous expectations.

A quarter of the 64 consumer and service companies, as well as 20% of the 69 manufacturers, said they expected to cut back on their investments in China. Only one business stated that it planned to boost investment in the country, where a zero-COVID policy has sparked fears of increased restrictions and economic consequences.

Only 35% of manufacturers were functioning at full capacity, according to the poll, which was conducted a week after Shanghai's population of 25 million officially came out of lockdown on June 1. A quarter were operating at less than 75% of normal capacity.

The difficulty of workers to move freely between homes and workplaces was the most common issue they described as impeding production.

"The Shanghai government must act fast to restore confidence by ensuring unobstructed supply chains, logistics, and worker mobility, as well as accelerating the provision of financial support to enterprises," said Eric Zheng, president of AmCham Shanghai.

As citizens struggled to acquire goods and lost income, Shanghai's two-month lockdown sparked widespread discontent and even unusual protests. It also wreaked havoc on China's economy, causing supply lines to break down and foreign trade to halt.

Even as other countries try to live with the virus, China has maintained its zero-COVID stance, claiming that it is necessary to safeguard the elderly and medical system, implying that lockdowns are a possibility every time a new case is discovered.

In actuality, despite the lifting of most limitations, many people in Shanghai are still under lockdown for periods ranging from a few days to several weeks as a result of such incidents.

Authorities in the city, where U.S. corporations like as Tesla and Procter & Gamble have big operations, are convening multiple roundtables and waiving some visa rules in order to rebuild confidence.

However, 87 percent of respondents agreed Shanghai should limit the usage of lockdowns to manage future COVID-19 outbreaks, according to the survey. While dealing with the pandemic, the city needs to "return to its pro-business stance," according to Zheng.

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