(Bloomberg) -- China is taking stronger measures to stabilize supply chains, pledging financial aid and possible exemptions to allow some businesses activity to resume, to help limit the damaging effect of Covid restrictions.
Authorities will improve living and working conditions in the logistics industry and provide employees with financial support, such as deferring repayments on loans, according to a state media readout of a meeting attended by Vice Premier Liu He and chaired by State Councilor Xiao Jie on Monday.
Tight restrictions to stamp out coronavirus infections are weighing on the economy and threatening supply chains. Shanghai’s lockdown has led to factory closures and a shortage of trucks to move goods, with containers piling up at the port, which is the world’s largest. It now takes about 115 days on average for goods to reach a warehouse in the U.S. from the moment they are produced at a factory in China, up from 50 days in 2019, according to freight-forwarder Flexport Inc.
To help supply chains, the government will establish “white lists” of companies in sectors including automobiles, semiconductors, consumer electronics, food, equipment manufacturing and medicine and foreign trade, the official Xinhua News Agency said. The report didn’t provide more details, although a similar “white list” of companies in Shanghai was disclosed late last week allowing companies to make plans to resume production.
Read More: Shanghai Unveils Business Restart Plan on Supply-Chain Woes
Officials also urged local governments to relax mobility restrictions for logistics workers at checkpoints, and recognize the results of their Covid tests performed in other regions.
China will leverage 1 trillion yuan ($157 billion) in funding from some of the central bank’s relending programs to support supply chains, Xinhua said. The report cited a 200 billion yuan relending program focused on technology innovation, along with a 100 billion yuan program focused on transportation and logistics.
The meeting came days after the People’s Bank of China and the country’s banking regulator pledged financial support for logistics firms and truck drivers.
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