A large number of Chinese companies are facing disruption as a result of the Iran war, with many closing down operations, evacuating their staff and reconsidering how much can be done remotely as opposed to having people on the ground. The Morning Post said that WeRide, Meituan and Baidu were among the companies halting operations or instituting remote work.
China has taken great advantage of the stability of the Gulf States over the past few decades and the current volatility is having a huge impact on business, logistics and supplies, and calling into question all sorts of developments and plans. The indications are that the disruption is already serious and the longer the war goes on, the more impact it is going to have on the business operations of China and other countries in the Gulf States.
The Gulf is a supplier of a significant portion of China’s total imports and the Strait of Hormuz is now closed. Reuters reports that China has about 78 days’ worth of oil stockpiled, which means it is somewhat cushioned from the impact of the disruption to the world’s oil supplies. But 78 days is not a particularly long period of time, Trump has suggested the war could go on for 4-5 weeks or longer, and apart from the resumption of oil supplies from the Gulf, there is the question of the longer-term future of Iran as the supplier of oil to China. This level of disruption presents many scenarios in terms of outcomes, from the very negative for China to the very positive, a positive being China providing reconstruction services for all. But right now, uncertainties rule.