![]() A worker rides his bike through the deserted Shougang Steelworks on the outskirts of Beijing. Its blast furnaces are shut for the Olympics. Oded Balilty / The Associated Press
Charles E. Gillman Company Accounting Specialist Sales and Marketing Everready Glass Sales Reps Construction West-Press Printing Health Care CENTRAL ARIZONA COLLEGE DIRECTOR OF HEALTH INFORMATION MANAGEMENT Trades/Construction RANCHO RESORT MAINTANANCE POSITION Administrative & Professional Tucson Urban League CEO/President Mechanical Komatsu Equipment Co Resident Field Mechanic BusinessOlympic pollution controls costlyThe Associated Press
Tucson, Arizona | Published: 07.30.2008
BEIJING — Factory shutdowns and other industrial restrictions intended to help reduce Beijing's eye-searing smog for the Summer Olympics are making business more complicated — and costly — for Chinese providers of steel, pharmaceuticals and other goods and services.
The financial impact of the disruptions is hard to estimate, but China's exports should not be greatly affected, because suppliers had months to prepare, analysts and company representatives said.
Still, manufacturers have spent extra to produce and warehouse supplies ahead of the August games, or to arrange special transport. These costs come on top of the $40 billion the government is spending on Olympic venues and improvements to Beijing's infrastructure.
Businesses across China also are reeling from a government decision to tighten security screening of applicants for both business and tourist visas.
Some tourists have been blocked from traveling, while others simply have been turned off. Upscale hotels, many of which went through costly renovations for the Olympics, have been half-empty in the past three months. Industry executives say it is the worst slump since a severe pneumonia outbreak that jumped from China to the world.
"It is almost as bad as 2003, when SARS (Severe Acute Respiratory Syndrome) broke out," said Matthew Lin, director of Bravo Tours China in Shanghai, where he said business is down 30 percent. "Many foreigners canceled their trips or didn't bother to come."
Ordered to shut down its blast furnaces to help clear the air for the 10,500 athletes and 500,000 tourists expected for the games, steel producer Beijing Shougang Group embarked on a massive effort to ensure its customers would not be affected. The company, a key supplier to China's booming construction industry, ramped up output in the first half of the year so it could fill orders during the shutdown, and it shifted some production to a mill outside Beijing.
Shopkeepers and manufacturers throughout Beijing will suffer from rules that ban trucks from the Chinese capital, making deliveries more costly or impossible. They will have to cut operations or pay sharply higher prices to move goods by van.
The city already has banned 300,000 older trucks and other vehicles since July 1.
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