Hong Kong puts 130 pilots in quarantine, fueling fears in the supply chain Business and Economic News

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Hong Kong has forced 130 Cathay Pacific pilots to carry out a 21-day quarantine, raising fears that the aviation center’s “zero COVID” policy could exacerbate the global supply crisis caused by the pandemic.
Hong Kong CEO Carrie Lam made the announcement on Tuesday after three pilots passed strict COVID testing protocols and tested positive for re-entry into the international financial center.
Lame said all aviation staff who were staying at a hotel in Frankfurt (Germany) when the three pilots made a stopover.
Authorities sent 130 cargoes and pilot passengers, along with cabin crew, to a government-managed forty facility in semi-autonomous territory of China, which imports more than 90 percent of the food.
“If there is one or two more cases like this, we could lose all our pilot cargo,” Lam said at a news conference, acknowledging that the move would have a major impact on the city’s supply chains.
The decision “seems a bit extreme,” said Shukor Yusof, founder of the aviation consulting firm Endau Analytics. “In addition to the inconvenience to pilots, it is likely that it will also cause additional costs for the airline, at a time when its finances are under strain, and will weaken its position as an air hub in Hong Kong.”
The move is the latest blow to Cathay Pacific, which is being overcome in 2019 as a result of the pandemic and massive protests against democracy and government. When it came to pride in Hong Kong, the company laid off nearly 6,000 employees and hired lawyers. a regional airline in October last year. The airline had a $ 7.6 billion ($ 97.6 million) loss in Hong Kong in the first half of the year.
To work around the city’s COVID-19 restrictions, the airline is considering relocating its pilots to Dubai, Anchorage and Chicago, among others. In addition, all aircraft crews now arriving in Hong Kong must be isolated at home for three days and not reunited.
In line with China’s strategy to eradicate the coronavirus, Hong Kong has established one of the forty most stringent regimes in the world, despite no major outbreaks since the start of the year.
The Lam administration has justified a policy that has frustrated foreign businesses and foreigners, citing the need to reopen the border with mainland China.
In an effort to satisfy Beijing, Hong Kong last month rejected most of the forty exceptions and tightened pandemic control measures further.
Authorities have refused to give a deadline to reopen the international border, despite concerns from some health experts and the business community that the city’s “zero COVID” attitude is unbearable and risks undermining its international status.
Trinh D Nguyen, a senior economist at Natixis, said the zero-tolerance approach in Hong Kong and mainland China came at a high cost, especially as the world gradually reopened.
The strategy “required relatively strict administrative controls on international and domestic mobility, which can be quite costly economically, especially for Hong Kong, which is dependent on international mobility for key sectors such as tourism and finance,” Nguyen said.
Nguyen also warned that the impact could extend beyond the city.
“Tightening controls will further exacerbate the challenges of Hong Kong, the regional and global supply chain, as Hong Kong is the most crowded airport for air cargo, such as mobile devices, clothing, fresh fruit and seafood,” he said.
Contingency plans
But Tommy Wu, chief economist at Oxford Economics in Hong Kong, predicted that the impact of the disruption would be limited.
“The overall impact on the airline’s operation will not be serious, as it may call on some employees who are currently on unpaid leave if necessary,” Wuk said.
“There are also contingency plans that the airline may impose to temporarily relocate workers to locations outside Hong Kong to avoid drastic quarantine reductions, even if those plans will have additional costs for the airline.”
Speaking on Tuesday, Lam also defended Jamie Dimon, president and CEO of JPMorgan Chase, a decision to grant a quarantine exception, which arrived in the city on Monday in a private jet.
“After all, it’s a big bank with major businesses in Hong Kong. Its trajectory has restrictions, so the risk is completely under control, ”Lam said.
In August, Hollywood actress Nicole Kidman sparked a backlash after she was allowed to avoid quarantine rules after filming her next drama series Expats.
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