CHINA’S WORST FLOODS IN DECADES THREATEN TO DERAIL SUPPLY CHAINS

Since early June, China has been hit by near-nationwide severe flooding that have been characterized as some of the worst in decades

Severe flooding triggered by heavy rainfall has impacted many regions across eastern, central, and southern China and comes on the heels of the country’s economic recovery efforts following the COVID-19 pandemic that disrupted global manufacturing.

Resilience360 has identified over 27 provinces that have been affected by severe flooding and heavy rainfall, with at least 21 provinces having declared a critical red-level flood or rainstorm alert warning over the past two months. Some of the hardest-hit regions include Jiangxi and Anhui as well as the major manufacturing hubs of Hubei, Jiangsu, Sichuan, and Chongqing. As of July 29, 00:00 GMT, Chinese authorities estimate the direct economic damages from the floods to be about CNY 116 billion (USD 16.6 billion; EUR 14.2 billion); more than 2 million people along the Yangtze River have been displaced.

Serious supply chain disruptions due to flooding are impacting the procurement of essential personal protective equipment (PPE) and medical supplies needed to combat the COVID-19 pandemic. Industrial sectors (such as coal mining and steel manufacturing) and food and agricultural production are affected, while disruptions stemming from port congestion and closures have also been reported.

This Resilience360 Special Report takes a closer look at the current situation stemming from the severe flooding and how companies sourcing from suppliers and manufacturers in China will need to adapt. It analyzes the impacted provinces and regions and how logistics and industrial production may be further impacted should torrential rainfall continue to persist across the country.

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