A COVID surge in China could have global economic consequences
DWANE BROWN, HOST:
There's growing evidence that China is experiencing a massive COVID surge. This belated wave of sickness in mostly unvaccinated China could have major economic consequences, not just for China but for the world. The U.S., like much of the world, relies on Chinese-made goods and parts. So what effect is that having on small businesses here? Are they feeling the pinch? And how are they planning for it?
WILLIAM BALASH: You can look at it either as it's going to, you know, make your head explode, or you could say, it's a game, and I'm going to win.
BROWN: That's William Balash. He runs a third-party logistics company called Shipping Solutions Consultants by Quandary. That's based out of New York.
BALASH: Yes, it is frustrating. It is stressful for the customers. My job is to get it done so that - to relieve that stress.
BROWN: Our co-host, A Martínez, talked with Balash, whose business model relies on Chinese-made goods.
A MARTÍNEZ, HOST:
William, what would you say is the No. 1 way the pandemic has affected your business and your work?
BALASH: Just being able to provide solutions that others can't and getting things moved. When this whole thing started with the whole lockdown, if a business had an online presence, an e-commerce presence, they were very successful. If they didn't, it didn't matter how big or how small they were; they were out of business. So there were some companies that did very well because they were already positioned for that.
MARTÍNEZ: What would you say was the No. 1 challenge for you when dealing with shipments out of China?
BALASH: Getting the shipments out because they put caps on the delivery and also the customs paperwork, where they started to go a little, you know, restrictive, where they would just turn shipments around if the paperwork wasn't done properly and send it back to its country of origin. And now you have to go through paperwork to get it back over again. So that might take you a month to get your shipment.
MARTÍNEZ: So how might this current COVID surge in China impact you and your business?
BALASH: If the factories are shut down, can't get anything out from those factories. If the factories are operating, there's a way to get those shipments out. This is an ongoing thing. This is long before COVID, this issue with China, with shipments and everything has been going on. There's been a lot of movement along the way to move business out of China. When Donald Trump imposed the additional taxes, some businesses figured out that it was time for them to move to other countries.
So what I have seen over the last few years is that more shipments are coming out of other countries, Asian countries, as opposed to China, because they figured out that China is - it's always been a big mess, but they never had a reason or, you know, maybe a way or whatever it was to move their operations. So they have been moving to other countries, and that has helped facilitate some of it. There are plenty of countries that are reaching out to the United States for manufacturing. They're saying, listen; we've got locations. We've got beautiful islands. We've got, you know, great locations. And we want to do manufacturing. Come to our island and work with us. So that's what's been going on over the last couple of years as well.
MARTÍNEZ: But is China just too big of a giant in manufacturing for any country or even a collection of countries to replace it?
BALASH: Well, it's not about replacing; it's about chipping away at it. It's, you know, one piece at a time. It's - you're not going to fix this overnight.
MARTÍNEZ: I feel like I've been hearing that for decade after decade - we've got to stop relying on China. But it just never seems to happen. What do you think is the reason for that, for not being able to at least seemingly head in the direction of a clean break at some point?
BALASH: Well, first of all, we're not - you're never going to stop 'cause we're not quitters (laughter), you know? So, I mean, it's a matter of replacing. It's a matter of changing it one piece at a time.
MARTÍNEZ: That's shipping and logistics consultant William Balash. William, thanks a lot.
BALASH: You're welcome. Transcript provided by NPR, Copyright NPR.