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    China controls medical supplies, in this outbreak and the next

    Synopsis

    Before the pandemic, China already exported more respirators, surgical masks, medical goggles and protective garments than the rest of the world combined, the Peterson Institute for International Economics estimated.

    AP
    Other nations will find it tough to compete with China’s low-cost model.
    Coronavirus

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    BEIJING: Alarmed at China’s stranglehold over supplies of masks, gowns, test kits and other front-line weapons for battling the coronavirus, countries around the world have set up their own factories to cope with this pandemic and outbreaks of the future.

    When the outbreak subsides, those factories may struggle to survive. China has laid the groundwork to dominate the market for protective and medical supplies for years to come. Factory owners get cheap land, courtesy of the Chinese government. Loans and subsidies are plentiful. Chinese hospitals are often told to buy locally, giving China’s suppliers a vast and captive market. Once vaccines emerge, demand will plummet. Factories will close.

    But Chinese companies are likely to have the lowest costs by far and be best positioned for the next global outbreak. China’s grip on the market is a testament to its drive to dominate important cogs in the global industrial machine.

    Before the pandemic, China already exported more respirators, surgical masks, medical goggles and protective garments than the rest of the world combined, the Peterson Institute for International Economics estimated.

    Beijing’s coronavirus response has only added to that dominance. It increased mask production nearly 12-fold in February alone. It can now make 150 tonnes per day of the specialised fabric used for masks, said Bob McIlvaine, who runs a namesake research and consulting firm in Northfield, Illinois. That is five times what China could make before the outbreak, and 15 times the output of US companies even after they ramped up production this spring.

    US companies have been reluctant to make big investments in fabric manufacturing because they worry that mask demand will be temporary. But Texas required Thursday that most residents wear masks in public places, part of a broader embrace of face masks in recent days. “It is a huge mistake to assume that the market will disappear,” McIlvaine said.

    Ma Zhaoxu, vice minister of foreign affairs, said that from March through May, China exported 70.6 billion masks. The entire world produced about 20 billion all of last year, with China accounting for half. Other countries now want self-reliance. Earlier in the pandemic, China sometimes decided which countries received crucial supplies and demanded profuse and public thanks in exchange.

    In 2005, after the outbreak of SARS, which killed 350 people in China, the Ministry of Science and Technology announced that it had developed respirators that better fit Chinese faces. In 2010, the government’s five-year economic plan ordered a “focus on developing basic equipment and medical materials that have high demand, wide application and are mainly imported.”

    China also foresaw the importance of nucleic acid test kits, which can detect coronavirus infections. In 2017, the Ministry of Science and Technology identified the kits as a “targeted development” industry.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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    1 Comment on this Story

    raaj till37 days ago
    shows when world sleeps China is awake to capture market . pseudo democracies indulge in competitive cheap politics giving freebies to free riders, free loaders, idlers, lazy lumbers to get their votes and when push come to shove deliver aspiration narratives
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