China's Power Shortage Deepens, Raising Concerns Over 4Q Economic Growth Impact

Production Disruptions in Guangdong and Neimenggu
"4Q Target Growth Rate of 5% Difficult to Achieve"

[Image source=Reuters Yonhap News]

[Asia Economy Beijing=Special Correspondent Jo Young-shin] Concerns have emerged through local media that China’s power shortage could hamper the country’s economy in the fourth quarter.

The state-run Global Times reported on the 22nd that power shortages have spread from Zhejiang, Jiangxi, and Hunan provinces to Guangdong Province and the Inner Mongolia Autonomous Region, causing disruptions in some production activities. The hardest hit by the limited power supply due to shortages are industrial sites. With power being supplied restrictively, factories are not operating normally. A representative from a copper processing company lamented in an interview with the Global Times, “This power shortage is causing devastating damage.”

A representative from an aluminum manufacturing company said, “We received a notice from authorities to keep electricity usage below 200 kilowatt-hours (kWh) per hour,” adding, “We explained our required power needs to the authorities, but the only response was that private demand takes priority.” Another company official expressed concern, saying, “The business losses due to power restrictions could amount to millions of yuan.”

As the situation worsened, some factories even installed their own generators. Hong Kong media Ming Pao reported that factories in Yiwu City, Zhejiang Province, facing the risk of missing delivery deadlines due to the power shortage, have installed diesel generators to keep production lines running. It also reported that power is being supplied in four grades depending on factory size, with some factories completely shutting down. A company official struggling with the limited power supply complained, “Factories operate for three days and stop for one day, or work one day and stop for four days,” adding, “All production lines have collapsed.”

There are also concerns that the power shortage could affect China’s economic growth in the fourth quarter. For China’s economy to achieve growth in the 2% range this year, the fourth-quarter growth rate must exceed 5%. Chinese authorities emphasize that the power shortage in some regions is due to increased strategic usage following the economic recovery and colder weather, but they have not provided clear answers on how severe the shortage is or how long it will last.

Meanwhile, the Chinese State Council released the “White Paper on China’s Energy Development in the New Era” the day before. The white paper states that China is pursuing new energy development to support the sustainable and sound development of society, and that China will contribute to global climate change response, energy security, and the promotion of global economic growth.

This content was produced with the assistance of AI translation services.