China quake could hobble commerce for months

13 May 2008 23:46  [Source: ICIS news]

WASHINGTON (ICIS news)--The devastating earthquake in China may disrupt the country’s infrastructure and the flow of chemicals trade and other commerce for the rest of this year, US distribution specialists said on Tuesday.


The impact of the earthquake also may be aggravated by frantic government efforts to clean up Beijing’s atmosphere in preparation for the Olympic games that will run 8-24 August, sources said.


The earthquake may have an impact on China’s commerce and infrastructure well beyond Sichuan Province where the 7.9-magnitude quake was centred, according to US chemical distributors.


“We are concerned that the earthquake may have an impact on China’s infrastructure and the country’s ability to maintain commerce and product flow,” said Lucinda Schofer, vice president for marketing at the National Association of Chemical Distributors (NACD).


The association’s member companies purchase and distribute chemicals and derivative products to some 750,000 industrial customers worldwide.


In addition to direct disruption of road and rail systems caused by the earthquake, wide-scale efforts for recovery and reconstruction may divert transportation assets and complicate regular supply operations.


Schofer quoted a major US distributor as saying that “Infrastructure in China - roads, rail links and other ground transport - is tenuous anyway, and the quake will have dramatic impact on that system”.


She said an association board member predicted that the quake could disrupt commercial distribution in China for three to six months.


While the horrific loss of human life - as many as 20,000 may have been killed - and care for survivors remain the overwhelming focus, the quake’s impact on China’s economy comes at a particularly critical time, sources said.


In preparation for the Olympic games in August, the Beijing government has been taking increasingly urgent steps to reduce atmospheric pollution in and around the capital. 


Beijing’s atmospheric contaminants rank it with Mexico City as one of the most polluted metropolitan areas worldwide, according to some environmental surveys, and the Chinese government is anxious to avoid the embarrassment of having Olympic athletes seen gasping for breath.


Vehicle traffic is being limited within a 300-kilometre radius of Beijing, and factory production within that area is being sharply reduced and may be shut down entirely in the weeks leading up to the games.


Between the after effects of the earthquake and government efforts to stifle emissions around the capital transportation hub, “the transport situation is going to get a lot worse,” an association member said.


($1 = €0.65)


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By: Joe Kamalick
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