Singapore businesses in Shanghai gear up for planned lifting of Covid curbs

WITH Shanghai aiming to reopen from Jun 1, Singapore businesses caught in its protracted lockdown are gearing up for a long-awaited return to business as usual. However, given how the earlier plans for easing did not materialise, not all are confident of the latest timeline given by the authorities.

Consumer brands told The Business Times that Shanghai shopping malls have asked them to prepare to reopen, but with few details on how and when this will happen.

Ang Kiam Lian, chief executive officer (China) of Jumbo Group, said he was recently asked by 2 malls if the group’s restaurants within the malls were keen to resume operations, which he regards as a “good sign”. “We see light at the end of the tunnel, although it’s still blurry. The general direction is there, so we are just going to apply to reopen, to make sure we are ready when it happens,” said Ang, who has 4 restaurants in Shanghai.

But he believes it will take at least a month after the full reopening – which he expects to happen only from mid- to end-June – for Shanghai to return to its pre-lockdown level of activity. 

Baby product retailer Motherswork has outlets in 3 shopping malls, with 1 having already asked the company to apply to reopen. But the company’s founder Sharon Wong remains sceptical, saying that the prospect of reopening is meaningless if there is no clarity on the easing of the city’s tight movement controls.

After a lockdown that has lasted over 7 weeks, Shanghai deputy mayor Zong Ming on Monday set out plans for the return of “normal life” from June 1 in stages, with public transport and other services to resume gradually after May 21. 

Vice mayor Chen Tong said on May 15 that shopping malls, department stores and supermarkets were to begin resuming in-store operations and allow customers to shop in “an orderly way” from the next day, although he gave no specifics on the pace or extent of this. 

CapitaLand Investment (CLI), which operates 7 malls in Shanghai, said their properties are “currently preparing for a gradual resumption of business” under the announced plans. CLI’s malls have been closed since early April, though a few supermarkets in them have been allowed to operate throughout the lockdown. “We have been actively working with the authorities to facilitate our tenants being allowed to progressively reopen, and to get approvals for our staff to return to work,” said a CLI spokesperson.

CLI has also onboarded more tenants to its CapitaStar online platform, on which marketing activities will be rolled out once malls reopen.

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Ang Poh Seng, CEO (China) of EtonHouse International Education Group, is “very hopeful” that preschools will be allowed to reopen in June, despite the lack of an “exact date”.

“We are waiting for the government’s advice on when that will happen,” said Ang. With EtonHouse’s 2 preschools in Shanghai closed since mid-March, its teachers have continued to engage children and families through home-based learning and bonding activities.

“We believe that the situation in Shanghai will continue to improve over the next few weeks, with more activities being allowed to resume… we are fully prepared to welcome our children and staff back to school, to finish off the current academic year,” he added.

For Motherswork’s Wong, freedom of movement is crucial. “Even if we get the green light to open the store, our staff who are on duty cannot go home – they’d have to live in the store, or in the mall. And if people are not allowed to roam freely in neighbourhoods, there will be no traffic in the malls – so what’s the point of reopening?” she said.

Still, she hopes to reopen at least 1 store from which to fulfill online orders, which her firm has been unable to do during the lockdown – though this depends on whether Shanghai will allow supply chain logistics to resume fully in the coming weeks.

Making it through the lockdown

Some firms have been able to operate, but still look forward to further reopening. Tech manufacturer Nanofilm Technologies, which has 2 plants in Pudong, told BT that its operations have continued but “not at ideal capacity”.

This is under “a closed-loop manufacturing arrangement with stringent health measures” – under which workers sleep on site to avoid contact with others. While most manufacturers in Shanghai halted production on Apr 1, about 2,000 key manufacturers have been able to resume production since mid-April under such a system.

Said a spokesperson from Nanofilm: “There are constraints on supply chain and manpower that slow down our ability to scale our production capacity to levels we want. In the event that the Shanghai lockdown is prolonged further, there may be impact on the group’s operations.”

Precision parts maker CDW Holding on Tuesday said that it has partially resumed production in Shanghai under a “closed loop” arrangement. Its application to resume manufacturing at a second plant in Shanghai is still ongoing.

Meanwhile, Singapore banks in Shanghai have closed their branches and are not offering in-person customer services, with most employees working from home.

A spokesperson from UOB, which has 5 branches and sub-branches in Shanghai, said that business teams have been “staying in touch and providing the necessary support” to clients, adding: “We have also stationed some colleagues at UOB Plaza, our headquarters in Shanghai, to provide off-site essential banking services to our customers round the clock.”

With OCBC Wing Hang China’s head office, branch and sub-branch in Shanghai having been progressively closed from end-March, the bank has continued to provide services through channels such as online and WeChat banking, said Patrick Chew, group head of operational risk management at OCBC Bank. 

He added that the bank will continue to monitor the situation and has put in place precautionary health and safety measures in preparation for business resumption.

On the other hand, Jumbo Group’s Ang is waiting for approval to reopen a restaurant for food delivery, after his hopes for dine-in to resume by early May were dashed. The group only managed to get on the Shanghai government’s white list of key enterprises in early May.

“We’re hoping food delivery can bring in 30 to 40 per cent of our regular revenue, using 15 to 20 per cent of our staff, to tide us through this period before the reopening,” he said.

Despite the lack of clarity, Singapore businesses remain bullish on the market’s quick rebound once reopening happens.

Said CLI’s spokesperson: “Referencing the post-lockdown experiences of other Chinese cities, we are looking forward to Shanghai’s consumption engine to reignite once the city gets back to business.”

“The interesting thing about China is that the minute something happens, it happens fast,” said Motherswork’s Wong. “As hard as it is now, this is a curveball we have to deal with. If we survive it, it can come back very quickly for Shanghai.”