New COVID-19 outbreaks in Asia have disrupted global supply chains and threaten to drag down the post-pandemic economic recovery, The Wall Street Journal reported on Friday (June 11).

In one case, an outbreak in the Chinese city of Shenzhen at one of the world’s busiest ports has caused worldwide shipping delays. New COVID cases in Taiwan and Malaysia have exacerbated a global chip shortage that has hamstrung automotive and tech production.

“The new headaches add to inflation concerns, after China and the U.S. this week recorded their biggest annual jumps in factory-gate prices and consumer prices, respectively, in more than a decade,” the Journal story reported. “If such problems continue — and get worse — they could weigh on global growth.”

Last year saw China and many other Asian countries keeping COVID-19 outbreaks in check while the virus ravaged the U.S. and Europe, limiting economic damage. Now that vaccinations have begun, the situation is reversed. Western governments are reopening as their economies take on new life, while vaccination efforts in Asia have lagged. Lower immunization rates in Asia could cause travel bans and social distancing to remain in place, further slowing manufacturing and consumer spending.

As PYMNTS noted in April, supply chains were already feeling the pressure due to post-pandemic demand for consumer goods vastly outweighing supply, along with issues like the 10-day blockage on the Suez Canal.

And now in Shenzhen, an outbreak among workers at the Yantian container port has slowed traffic to more or less a standstill, with roughly 160,000 containers waiting to be loaded. In 2020, Yantian handled 50 percent more freight than the Port of Los Angeles, America’s busiest container port.

COVID-19 has exposed vulnerabilities in how goods travel the world, Dr. Paul Sheard of Harvard’s Kennedy School told PYMNTS last year. Read PYMNTS’ report for more on the need for modern supply chain solutions.


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