Because of the Corona pandemic: the closure of Shanghai shakes the economy of China and the world

Weather of Arabia - Many multinational companies have a foothold in the Chinese city of Shanghai, from the giant Tesla factory to the huge Disney resort, and now the pulse of the city that represents the important financial center has stopped, as the Chinese authorities continue to close the city of Shanghai, after recording the highest rate of infection with the virus Corona two years ago.

This shutdown could prove especially costly for the world's second largest economy, as in addition to being a major hub for the financial industry, Shanghai is a hub for electronics and auto manufacturing. It also owns the world's busiest shipping port.

After officials imposed two successive waves of lockdown on the city's more than 26 million residents, the latest lockdown in China is the largest since the outbreak of the coronavirus was first detected in Wuhan at the end of 2019.

Read also: Corona terrifies China again, and records the highest daily death toll in more than two years

The city known for its high-end storefronts such as Gauche and Louis Vuitton has seen a decline in consumer spending, locally, and lost business in retailers, hotels and restaurants could cost Shanghai 3.7% of annual GDP.

At the end of last week, data indicated a slowdown in the month of March in China's manufacturing and services sectors.

This came after last month, the Shenzhen and Jilin technology centers in industrial northeastern China also faced closures so that officials could conduct mass tests for the Corona virus, and try to limit the spread of the rapidly spreading “Omicron” variant. .

As the number of coronavirus cases rises, problems may increase in the future, if more closures are imposed, especially for small business owners.

Taking a strict approach to the fight against the Corona virus

Even as most of the world opens borders and eases restrictions, it is still unlikely that China will move away from its tough approach to the Corona virus, but the majority of the population inside China still supports the policy of zero infections, despite the costs growing economic.

On the other hand, Beijing pledged to support the economy to achieve its ambitious goal of growth, and to ensure that China's supply chain runs smoothly, with the aim of reducing global supply chain disruption during the shutdown period.