Typically, China’s economy comes to a standstill during the annual Chinese New Year, but not in 2021, explains business analyst Shaun Rein to CNBCTV. GovermentalCovid-19 restrictions make it tough for migrant workers to return home, and double salaries at the factories might encourage them to continue working during the festival. Other industries like travel and leisure might suffer, though.
Shaun Rein, Managing Director at China Market Research Group on Wednesday said he expects the factory sector to outperform the expectations.
“The factories are offering incentives for workers to stay, they are giving double payment on their salaries. Meantime a lot of these workers have decided to stay where they work and so factories are going full steam ahead in January and February, so we expect that the factory sector is going to outperform a lot of expectations,” he told CNBC-TV18.
“You are also going to see outperforming in manufacturing and on eCommerce,” he added.
Rein’s observations come at a time when the Chinese migrant workers return home during the Chinese Lunar New Year period. Coming in the backdrop of almost a year of the coronavirus pandemic with reports showing re-emergence of the cases in January, the Chinese government got nervous and a lot of provincial governments made the COVID test mandatory.
China’s central government said that between January 28 and March 8—the six week period—there are going to be high restrictions on internal travel.
These new instructions on travel will hit the travel and leisure industry negatively, Rein said.
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