Coronavirus: China tries to go back to work to heal illness-inflicted economy

Tom Cheshire, news correspondent

The world's workshop is trying to get back to work. 

But not only does China have to make up for lost time - a month for most companies - it's still subject to strict coronavirus restrictions .

To get her workers back to the factory, Kate Wong, chief executive of vape company RELX, paid them 20% extra. They are still two weeks away from full capacity.

Speaking to Sky News, she said that due to coronavirus : "The production side had a lot of impact.

"Production got delayed by 15 days. The reason is the workers have to stay at home for quarantine to come to the factory."

Some of RELX's suppliers are in Hubei province - the epicentre of the outbreak - and meant new sources had to be found. Despite this, Ms Wang remains optimistic.

She said: "We think the recovery is going to be strong. I think we can catch up but we're definitely one month behind our original forecast."

Weeks spent on lockdown has throttled the economy in China. The country recently released its latest manufacturing purchasing managers index (PMI) - a measure showing the direction in which the economy is heading.

A reading above 50 on the index represents growth, whereas anything below, is a contraction.

It went from 50 in January to just 35.7 a month later - even worse than the previous low recorded during the financial crisis of 2008.

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Other metrics are also down, with the transport ministry saying on Saturday that passenger volume on the roads, railways and trains had fallen nearly 80% in February.

As a result, China faces a difficult balancing act between restarting the economy and containing the spread of COVID-19.

Rushing people back to work, or easing off the cumbersome, ubiquitous restrictions, could lead to a second wave of a virus that appears to be diminishing here.

State media this week highlighted the fact that President Xi Jinping chaired a working meeting about the state of the economy during coronavirus, which marked a rare economic intervention.

The government is so keen to show business is getting back to normal that it invited Sky News on a tour of two sites in Beijing - a milk production facility and a power plant.

The propaganda message was clear: that businesses are being productive while also taking precautions.

Sun Li Feng, the manager of Hua Dian power plant, said: "We have confidence to keep our staff healthy and provide enough electricity for our society."

But even propaganda can be revealing. The government wanted to show journalists the economy was fine. But the fact they needed to make a show of that betrayed their anxiety.

Others, especially in the private service sector, are struggling.

Mr Zou, who runs a communications company in Beijing with 11 staff, said: "As a service provider, this virus has caused a devastating impact.

"That is to say, if clients don't give us commissions, we won't have any financial source or income."

When the outbreak began, Mr Zou chose not to renew the lease on his office and asked his employees to work from home. If the squeeze continues, he will lay-off staff and consider bank loans.

"If it doesn't get better by April, my company will face financial and economic issues," he said.

"Small companies can't face having no businesses for six months, because this means we will definitely face our death."