China has encouraged businesses to resume full production activities amid strict epidemic prevention and control measures. Many enterprises have announced that they will resume full production activities on Monday, Feb 10.
Globally, supply chains have been disrupted by the Chinese lock down to stop the spread of the deadly coronavirus outbreak. In order to set the economy back on track, China has directed state-owned enterprises to switch to full production as soon as possible. The Chinese government has ensured enterprises adequate supply of medical resources to prevent the spread of the virus and increase the production of essential medical supplies such as protective clothing.
China’s manufacturing activity in most provinces are yet to restart post the Chinese Lunar Year holidays. The government has issued 20 point measures to help companies restarts production. Enterprises are required to establish epidemic control mechanism, implement proper labor practices and social security policies. Companies are advised not to cut wages or delay wages due to production downtime, while government deferred private sector social insurance contributions to help keep payrolls stable.
Central banker People’s Bank of China (PBOC) injected CNY400bn ($57bn) into the country’s banking system on Tuesday and cut reverse repo rate to support the economy.
To boost consumption, manufacturers of key products will enjoy temporarily one-time tax deductions on purchase of equipments. Also revenues from supply key epidemic control products and public transportation services, consumer services, and express delivery will be exempted from value-added tax.