Oct 7, 2021 - Economy & Business

Fallout from China's energy crisis

A barge travels past the Wangting Power Plant in Wangting, China, on Sept. 30.
A barge travels past the Wangting Power Plant in Wangting, China, on Sept. 30. Photo: Qilai Shen/Bloomberg via Getty Images

China’s energy crisis shows no signs of slowing, and it’s poised to impact the flow of goods that the nation sends stateside.

Why it matters: Supply chain disruptions are a huge part of what’s holding back the world’s economic growth as it recovers from the pandemic lockdown era. Electricity blackouts in China spawned by a power shortage could make that worse.

Details: Key suppliers to tech giants like Apple, Tesla, Microsoft, HP and Dell have been forced to cease or reduce operations, the FT reports.

  • Suppliers to U.S.-based makers of consumer products like water bottles and backpacks also face caps on their power usage, the WSJ writes.
  • Food costs will probably rise, too. Agricultural processing plants have had to go dark, according to Bloomberg.

The bottom line: Global markets may be in for a further supply shock, which could add to inflation, Nomura chief China economist Ting Lu wrote in a research note, according to the WSJ report.

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