A bad weekend for Apple – and a worse one for China

What we are seeing right now is one more chunk of evidence that the Chinese economy will face increasing headwinds through the next decade, writes Hamish McRae

It is glaringly obvious that global supply chains for electronic components and products will continue to be seriously disrupted for the foreseeable future (AP)

It has been a troubling weekend in China, where violent protests against Covid lockdowns have struck Shanghai and other major cities. It has also been a troubling period for Apple. The world’s biggest iPhone factory in Zhengzhou, run by Foxconn, has seen huge unrest about working conditions.

It isn’t easy, writing from London, to make a judgement as to how the Chinese authorities will cope with the pressure to ease up on lockdowns, or how Foxconn will try to improve the working environment in its factories. But it is glaringly obvious that global supply chains for electronic components and products will continue to be seriously disrupted for the foreseeable future.

As a consequence of the Covid outbreaks, Foxconn has had to suspend chip production at its factories in Shenzhen and Shanghai. This is a specific issue for Apple, which has been short of supply over this Black Friday weekend, the biggest shopping period of the year. It is estimated that disruption in China is costing the company roughly $1bn a week in lost iPhone sales.