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China shuts factories, rations electricity as heat wave stifles economy

A man plunges into Wuhan's East Lake to cool off on Aug. 9 as a heat wave bakes swaths of China. (Getty Images)

BEIJING — China’s worst heat wave in six decades is deepening the economic pain of pandemic lockdowns, with authorities ordering factories this week to suspend production in several major manufacturing regions to conserve electricity.

Sichuan province, home to more than 80 million people, announced Monday that factories in 19 cities and prefectures would halt operations until Saturday to reserve electricity for “use by the people.” Other areas across China’s south have also ordered electricity to be prioritized to run air conditioners.

The factory suspensions reflect how climate change is intensifying China’s economic challenges. Officials have warned that the country is likely to miss its 5.5 percent growth target for the year, as coronavirus lockdowns disrupt trade and normal life.

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On Tuesday, Jin Xiandong, a spokesman for the National Development and Reform Commission, said China was having to rely more on coal for power because the heat wave and drought were significantly reducing hydropower output.

Fierce heat waves like this summer’s are expected to become increasingly common in China as climate change worsens. Eleven provinces currently have warnings in place for temperatures above 104 degrees Fahrenheit. Chongqing, a self-administered city surrounded by Sichuan province, reached a record 112.1 degrees over the weekend, with highs over 104 degrees forecast to continue for about another week.

China, the world’s largest emitter of carbon dioxide, has sought to present itself as a global leader on climate action, touting its shift toward electric vehicles and other measures. But the country has continued to build new coal-fired power plants. This month, Beijing suspended bilateral climate talks with the United States in retaliation for House Speaker Nancy Pelosi’s (D-Calif.) trip to Taiwan.

Dangerously high temperatures have left nations around the world struggling this summer, with the dry heat sparking fires in Britain, a power-grid shutdown in Iraq, and more than 1,000 deaths in Portugal. President Biden last month called climate change “an emergency.”

China’s inland Sichuan province has become an international manufacturing hub in recent years because of its lower production costs compared with coastal areas. The region produces and exports items including electronics, furniture and food. State media reported that Sichuan marked its highest single month of electricity consumption on record in July.

As the production halt took effect abruptly on Monday, factories were scrambling to figure out the financial effects.

Tongwei Solar, the world’s largest producer of crystalline silicon solar cells, has experienced interruptions at its three production bases in Sichuan, a public relations officer of the company told The Washington Post by telephone, declining to give his name.

“Now we are cooperating with relevant government departments to adjust energy consumption in an orderly way and are still assessing specific impacts,” he said.

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Foxconn, a major assembler for Apple, told the China Securities Journal that the “effect would not be large for the company’s operations.” Foxconn produces some Apple products, such as iPads and Macs, in Sichuan.

A fertilizer maker in Sichuan, Lutianhua, issued a notice on the Shenzhen Stock Exchange on Monday, saying it expected a $4.4 million hit to net profit because of the production halt.

The high temperatures could continue unabated through the end of the month, according to China’s National Meteorological Center.

China released its latest economic data, for July, on Monday, which showed unemployment rates rising and the economic recovery slowing as new coronavirus outbreaks and the heat wave took their toll. Youth unemployment rose to a record 19.9 percent.

Fu Linghui, spokesman for China’s National Bureau of Statistics, said in a news conference on Monday that high temperatures across the south had caused “adverse effects on economic operations.” He also said the pandemic’s effect on companies meant they weren’t able to offer as many jobs to young people as before.

“The momentum of economic recovery has slowed down marginally, and the foundation for consolidating economic recovery still needs to be strengthened,” Fu said.

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Underlining Beijing’s concerns about the economy, China’s central bank unexpectedly cut a key lending rate this week.

The country’s leaders had hoped for a stronger economic showing this year, ahead of a crucial Chinese Communist Party congress in the fall, where leader Xi Jinping is widely expected to break precedent by staying on for a third term. But Xi made clear in recent months he would not lift China’s “zero covid” policy despite the costs.

With foreign tourism still largely suspended, Beijing had encouraged families to take domestic holidays over the summer to shore up consumption. But the uptick in travel resulted in coronavirus outbreaks across the country, leading to lockdowns in some holiday destinations such as the beach resort of Sanya, the Xinjiang capital of Urumqi, and parts of Tibet.

China’s policy of putting any close contacts of a covid patient into quarantine is also continuing to disrupt daily life. Videos of shoppers fleeing an Ikea store in Shanghai were shared widely over the weekend, after an announcement that those on-site would be forced into quarantine because a close contact of a covid patient had visited the store.

Li reported from Seoul.

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