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China quietly hits power supply shock as Evergrande crisis holds limelight

Analysts predict China’s economy will shrink as power crunch hits housing bubble

Northern Chinese city cloaked in darkness. (Weibo photo)

Northern Chinese city cloaked in darkness. (Weibo photo)

TAIPEI (Taiwan News) — Widespread cuts to traffic lights in cities across northern China have caused havoc recently during rush hour as power supply shocks spread from factory floors to the country’s broader infrastructure.

A notice of the power cuts was issued to households across many northern cities on Thursday (Sept. 23). Since temperatures are low in those areas at this time of year, the blackouts have led to public anger, according to the Liberty Times.

Meanwhile, in the southern province of Guangdong, local authorities issued a notice on Sunday (Sept. 16) calling for all members of society to do their part to stop the spread of power outages, according to a Bloomberg report.

According to analysts, this reflects an escalating power crisis since Chinese authorities typically do not ask household consumers to wind down consumption unless limits on factory usage have not corrected the shortage.

Nearly half of China’s 23 provinces have missed power intensity targets this year, leading the central government to exert greater pressure on them to cut power, per reports.

“With market attention now laser-focused on Evergrande and Beijing’s unprecedented curbs on the property sector, another major supply-side shock may have been underestimated or even missed,” says Lu Ting (盧婷), a leading analyst at Nomura Holdings. As a result, Lu predicts China’s economy will shrink this quarter.

Updated : 2021-10-26 14:47 GMT+08:00