Shanghai has been locked down by the CCP for nearly a month. The strict pandemic prevention policy has halted local transportation, with trucking being the most affected and freight drivers unable to operate. This caused many empty containers to pile up at the docks. Satellite images show that as of April 21, Shanghai seaport, the world’s busiest container port, is currently stacked with cargo.
Vice President of the Danish provider of research and analysis, Sea-Intelligence, believes that, since many factories will want to make up for the loss, trucks and ships will be fully booked in the following few weeks if the lockdown is lifted in early May. Therefore, the international flow of goods will not return to normal until July.
Ruth Rohwer, the president of the Federation of German Industries (BDI), also said that companies and customers have been feeling the tremendous pressure of the international logistics turmoil with transport costs is more than doubled, due to the events such as the war between Russia and Ukraine and the pandemic. He fears that the longer the CCP imposes lockdown measures on Shanghai, the more severe the economic consequences will be.
Both the global economy and the international supply chain will be impacted, and there is no sign of relief is insight in the near future.
Apart from that, the CCP’s lockdown has also hit global stock markets hard. The Shanghai Composite Index went down 5.1% in Asia by the close of trading on the 25th, closing at a 22-month low. Hong Kong’s Hang Seng Index fell 3.7%, Japan’s Nikkei Index dropped 1.9% and South Korea’s Kospi Index fell 1.7%. In Europe and the U.S., the Dow fell 305 points to close at a new low since March, while Brent crude oil fell 4.76% to $101.10 per barrel and WTI crude oil continued its downward trend to $97.18 per barrel.