Disruptions in China can lead to ‘ripple-effects’ across global supply chain

China’s zero-Covid restrictions will impact global supply chain recovery as any small disruption in the country will likely lead to “ripple effects” across the world, according to the head of shipping at HSBC. The pandemic has revealed “how lean the supply chain has become. And there is little margin of error,” said Parash Jain, global head of shipping and ports equity research at HSBC.

“The sheer importance of China when it comes to global trade means that any small disruption in China, will have a ripple effect across the supply chain,” Jain told CNBC’s “Squawk Box Asia” on Monday.

China, the world’s second largest economy, has doubled down on its zero-Covid strategy due to recent spikes in infections across the country. Covid cases have been reported in the key port cities of Shenzhen, Tianjin and Ningbo, as well as the industrial hub of Xi’an, resulting in lockdowns and curbs in the largest port hubs.

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