China’s factories, households grapple with power cuts

BEIJING (AP) – Global shoppers face possible shortages of smartphones and other goods ahead of Christmas after power cuts to meet government energy use targets forced Chinese factories to shut down and left some households in the dark.

In the northeastern city of Liaoyang, 23 people were hospitalised with gas poisoning after ventilation in a metal casting factory was shut off following a power outage, according to state broadcaster CCTV. No deaths were reported.

A components supplier for Apple Inc’s iPhones said it suspended production at a factory west of Shanghai under orders from local authorities.

The disruption to China’s vast manufacturing industries during one of their busiest seasons reflects the ruling Communist Party’s struggle to balance economic growth with efforts to rein in pollution and emissions of climate-changing gases.

“Beijing’s unprecedented resolve in enforcing energy consumption limits could result in long-term benefits, but the short-term economic costs are substantial,” Nomura economists Ting Lu, Lisheng Wang and Jing Wang said in a report yesterday.

They cut their economic growth forecast for China to 4.7 per cent from 5.1 per cent over a year earlier in the current quarter. They cut their outlook for annual growth to 7.7 per cent from 8.2 per cent.

Global financial markets already were on edge about the possible collapse of one of China’s biggest real estate developers, Evergrande Group, which is struggling to avoid a default on billions of dollars of debt.

Manufacturers already are facing shortages of processor chips, disruptions in shipping and other lingering effects of the global shutdown of travel and trade to fight the coronavirus pandemic.

Steam billows out of the cooling towers at a coal-fired power station in Nanjing in east China’s Jiangsu province. PHOTO: AP