On Sunday, China put the southern city of Shenzhen and its nearly 18 million residents into lockdown until at least March 20 because of a spike in COVID-19 cases. Shenzhen is a major technology hub that has been referred to as China’s Silicon Valley.
Taiwan-headquartered Foxconn said Monday it’s halting operations in Shenzhen in light of the government lockdown, per multiple reports.
Foxconn didn’t immediately respond to Insider’s request for comment.
The Shenzhen lockdown threatens to exacerbate global supply-chain disruptions amid pandemic lockdowns, semiconductor shortages, and Russia’s war with Ukraine. Foxconn said in November that electronics shipments could face bottlenecks until second half of 2022.
Foxconn, also known as Hon Hai Precision Industry, didn’t say how long it intended to halt operations in Shenzhen. A Sina Finance report quoted a company spokesperson as saying that it needed government approval before it could resume work in the city.
Foxconn recently offered significant sign-on bonuses for workers in Zhengzhou, a central city in China that’s home to the company’s largest iPhone assembly line, Insider reported.
China has pursued a zero-Covid policy that’s marked by sudden and swift lockdowns of entire cities, but the highly-transmissible omicron variant has made it difficult for the country to continue with this approach. On Sunday, China reported nearly 3,400 new COVID-19 cases, almost double the number reported the previous day, making this latest wave the worst outbreak in two years, The Guardian said.
After announcing that Shenzhen registered 66 new local COVID-19 cases Sunday, the municipal government later said it would halt bus and subway services, and all housing estates and industrial parks would be closed. Residents were advised to not to leave the city.
Shanghai has also announced restrictions on travel, Nikkei reported.