Restrictions and closures of Chinese factories due to G20 Summit

Chinese Government will be holding the G20 Summit in Hangzhou China (close to Ningbo and Shanghai area) on September 4, 2016. There will be partial or complete closures of factories within 150km between June and Mid-September which will cause supply chain disruptions.

How will this impact global supply chains?

There are an estimated 1,000 factories which are expected to close. These closures are significant not only because they may cause a slow-down in production, but may also cause a surge in volume in anticipation. Some factories have allegedly increased their fees due to strong demand.

Why the closure?

Closing factories in this area is part of a clean air campaign in preparation for the G20 summit.

Tips to minimise supply chain disruptions:

• Place orders early to ensure cargo is shipped in advance of closings
• Ask vendors the timeframe and extent of factory closing
• Communicate changes in forecasts with us as soon as possible
• Have a plan B for sourcing, if possible

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