The Coronavirus pandemic has brought the whole world to a screeching halt and while things have slowly started moving towards the new-normal in countries around the globe, a different and a sordid tale is coming from China.
The virus, which to begin with, was making of China, is now showing the real impact of it on the country as a gargantuan wave of unemployment has swept China. The migrant workers are losing their jobs in factories and the service-sector is hit heavily as people prefer staying in the comfort of their homes away from the virus.
Big companies and not only from the American or European nations have packed up their bags from China owning to the disruption in the supply chain and moved on to newer pastures.
The companies are moving out of China to their native countries or other friendly countries that are more trustworthy to save their names and cut the losses that have expedited in China due to the nasty Trade wars.
Still not learning the lesson—China trying to paint a rosy picture
China has tried painting a rosy picture in front of the world by stating that the unemployment rate has fallen to 5.7 percent at the end of June from 5.9 percent in May. However, the percentage figures will be diabolically different if you add the numbers of China’s migrant workers who have been excluded from this survey.
China’s army of 290 million migrant workers, who have been hit particularly hard by the impact of the trade war with the US and the coronavirus have not been included in the aforementioned statistics and therefore it cannot be stated that unemployment rate has come down. It is the hallmark of a Communist regime to fudge the numbers to keep up with the appearances and this is exactly what the Chinese communist regime is doing.
Years of social progress in China is at the risk of being undone as the country grapples with the economic fallout of the Coronavirus pandemic. According to China’s Ministry of Commerce, the export industry accounts for around 180 million jobs in China, or over a third of China’s total 530 million non-farm jobs.
However, with companies winding down their businesses from the ‘World’s factory’—a large chunk of these workers have been rendered useless. A few statistics have shown that about 180 million service sector jobs have disappeared due to the Coronavirus outbreak in Mainland China.
Japan, Taiwan and other countries moving away, leaving factory workers unemployed
Japan and Taiwan are now incentivizing their companies to shift their production from China to their own country, or any other friendly country.
The South Korean government, too, is nudging large companies including Samsung, the conglomerate which alone accounts for almost one-fifth of the country’s GDP, to move the production of personal computers out of China.
A few days ago, Samsung announced that it will no longer assemble PC in China due to fierce market competition. This will eventually affect thousands of jobs in the country. “Except for employees at the research and development department, all others’ employment contracts will be affected,” reads the notice given to the staff by the contractors.
Reported by TFI, the Japanese government had also approved a stimulus package, worth a whopping amount of 108.2 trillion yen (or $993 billion) – equal to 20 per cent of Japan’s economic output. This was to cushion the impact of the epidemic on the world’s third-largest economy. Out of the total amount, it has earmarked US $2.2 billion to help its manufacturers to shift their production out of China.
So far, a total of 87 companies have signed up with the Ministry to move their manufacturing units out of China, with 57 moving back to Japan and 30 to different Southeast Asian nations like Vietnam, Thailand, and Laos.
The Coronavirus Pandemic, the man-made floods in Central China villages and the exodus of multinational companies from China following the US-China trade war has pushed the migrant-class workers to the edge of desperation.
According to SCMP, Mimi Vu, an independent Vietnamese-American anti-trafficking expert, said that more Chinese nationals might enter the Southeast Asian country to find work as factories have been relocated from China to Vietnam in wake of the trade war between the Trump administration and the Chinese Communist Party (CCP).
The situation is grim for China and its workers and given the apathy Xi Jinping red authoritarian regime has towards its own people, the situation is not expected to change for any good in the coming months.
This is just the tip of the iceberg, Beijing has lot more problems in store in the coming months if it keeps up with its pugnaciousness and arrogance. US is coming down hard on it and if another bout of Trade War breaks between this period, then China will be left alone, fending for itself as millions will become jobless.