Life after lockdown: returning to “normal life”
24 April 2020: Liu Zheng, CFO of Chinese manufacturer Surpass Sun Electric, tells ICAEW Insights how his company is recovering after China’s partial relaxation of lockdown measures, and what restrictions are still in place. Michelle Perry has the story.
Based in Beijing, Liu Zheng, is beginning to enjoy some semblance of ‘normal’ life again as the Chinese government relaxes some of its more stringent lockdown measures.
In early April, China’s National Health Commission reported no new COVID-19 deaths for the first time since January. After months of working from home, Zheng is now able to return to his office in Beijing to work.
“After two months of lockdown I have returned to normal life,” he told ICAEW Insights.
Travel within Beijing is permitted, but according to Zheng they are encouraged not to travel to other cities in China. If they do travel elsewhere, they have to isolate for 14 days on their return.
When he does go out it is still obligatory to wear face masks, and he must carry a QR code, a machine-readable barcode, that shows he hasn’t travelled elsewhere within the past 14 days. If he visits a new building, Zheng must get his body temperature checked before going into the building.
As a CFO Zheng, who worked for KPMG London from 2008 to 2012, found working from home manageable. He’s been working with investors ahead of a planned initial public offering on the Chinese stock market. However, his company’s manufacturing plant based in Hubei province not far from Wuhan, where the pandemic began, has been shut down in January and February, partly restored in March and 80% recovered in April.
“The manufacturing sector has been suspended for over a month, because our factory is in a city which is not far from Wuhan. It was too dangerous for staff to be together and work together.”
But he pointed out that the biggest challenge for his firm is on the sales side. “Our job is to sell our products overseas, to Europe, for example. But the sales team can't travel in China, or to Europe, so there will be a hit to sales in the revenue.
“It’s a really tough time,” continued Zheng. “We do have some support from government, but it’s a very big challenge to keep our cash flowing. I have heard from medium and small-sized companies that are finding it really hard because they don't have the cash.”
The government is offering businesses interest-free loans and there are some tax relief policies from local governments, Zheng explained. Also, businesses can negotiate rent relief for one or two months with private and state-owned landlords.
Zheng says he has been negotiating a rent exemption from his private landlord, who offered a 10-day exemption. “It’s not huge, but every little helps.”
The government has also been supporting industrial businesses through policy changes too, such as support for new infrastructure investments including 5G, internet of things, artificial intelligence, industrial internet, extra-high voltage, and electrical car charging points to stimulate the economy.
For the consumer market, which has suffered more, Chinese authorities are also trying to help through issuing consumer coupons to spend in shops and restaurants. Online shopping has been even more active than before.
“For example, if I'm going to a café and I order a coffee which is normally £10 I just pay £7 and pay the rest with coupons, which is sponsored by the local government.”
Still, Zheng is looking forward to returning to normal working life. He misses the cultural aspects of Chinese business life such as face to face meetings.
“For the most part I miss my usual working life. That said, we can find a way to work in the lockdown. I know it is not that convenient, but I think we can find new ways to replace our old ways when we need to.”
His advice to ICAEW members around the world is to remain positive and optimistic. “Also be cooperative with colleagues and clients.”