Yangtze shrinks as China drought hits industry

By MARK SCHIEFELBEIN

August 19, 2022 GMT

CHONGQING, China (AP) — Boats slid down the middle of the Yangtze River on Friday after China’s driest summer in six decades left one of its largest rivers barely half its normal width and sparked a struggle to contain the damage to a weak economy in a politically sensitive year.

Factories in Sichuan province and the adjoining metropolis of Chongqing in the southwest were ordered to close after reservoirs supplying hydroelectric power fell to half their normal levels and demand for air conditioning rose in scorching temperatures.

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River ferries in Chongqing, which are usually packed with tourists, were empty and moored to docks alongside mudflats that stretched up to 50 meters (50 yards) from the normal shoreline to the depleted riverbank. Smaller ships sailed down the middle of the Yangtze, one of China’s largest trade canals, but no large cargo ships were in sight.

Normally bustling streets were empty after temperatures hit 45 degrees Celsius (113 degrees Fahrenheit) in Chongqing on Thursday. State media said it was the hottest in China outside the Xinjiang desert region in the northwest since official records began in 1961.

“We can’t live this summer without air conditioning,” said Chen Haofeng, 22, who was taking photos of the exposed riverbed. “Nothing can refresh us.”

The disruption adds to challenges for the ruling Communist Party, which is trying to shore up flagging economic growth ahead of a meeting in October or November, when President Xi Jinping is expected to seek a third five-year term as leader.

The world’s second-largest economy grew just 2.5% from a year earlier in the first half of 2022, less than half the official target of 5.5%.

The impact of the drought in Sichuan is unusually severe because the province gets 80% of its power from hydroelectric dams.

Thousands of factories making processor chips, solar panels and auto components in Sichuan and Chongqing were closed this week for at least six days.

Some announced that there were no interruptions in supply to customers, but the Shanghai city government said in a letter published Thursday that Tesla Ltd. and a major Chinese automaker had been forced to suspend production.

The city government of Chengdu, the capital of Sichuan province, told households to conserve energy by setting the air conditioner no lower than 27 C (80 F). Another city, Dazhou, earlier announced three-hour daily power outages for neighborhoods.

The Yangtze basin, which covers parts of 19 provinces, produces 45% of China’s economic output, according to the World Bank.

Low water levels in the rivers also forced cargo shipments to stop.

A canal connecting Wuhan on the Yangtze with the northeast city of Anqing in Anhui was closed because it was too shallow for ships to move safely, Shanghai news outlet The Paper reported.

The national impact of the closures is limited because Sichuan accounts for only 4% of industrial output, while other provinces use more coal-based power, which has not been interrupted.

The government says China’s two main state-owned power companies, State Grid Ltd. and Southern Grid Ltd., are moving power from 15 other provinces to Sichuan.

A member of the ruling seven-member Communist Party Standing Committee, Han Zheng, pledged official support to ensure power supply during a visit to State Grid on Wednesday, according to the official Xinhua news agency.

China suffered similar disruptions last year when a dry summer led to hydropower shortages and shuttered factories in southeastern Guangdong province, a global manufacturing hub. Other regions suffered blackouts due to coal shortages and mandatory power outages to meet official energy efficiency targets.

This year is unlikely to be as severe, according to Larry Hu of the Macquarie Group.

“If power rationing in Sichuan only lasts for a few weeks, the impact on industrial output nationwide should be very limited,” Hu said in a report.

Xuguang Electronics Co. in Chengdu said the six-day shutdown would cut its output by 48,000 electronic circuits. The company said it expected to take a 5 million yuan ($600,000) hit to its annual profit.

BOE Technology Group Co., which makes electronic displays, said a Sichuan subsidiary would suspend production. BOE promised in a statement issued through the Shenzhen Stock Exchange to “fully guarantee the delivery of customers’ products.”

News reports said Sichuan producers of solar panels and lithium for electric cars also closed, but no company announced supply disruptions.

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AP Video Producer Olivia Zhang contributed to this report.

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