The new order for companies located in Zhejiang to temporarily halt production has impacted around 160 energy-intensive companies, mainly in the textile, dyeing and chemical fiber industries. As per an Apparel Resource report, nearly 80 per cent companies in the city’s Ma’an area were ordered to halt production from September 21-30, 2021. The order is aimed at controlling the provincial Government’s energy consumption requirements.

As per original report of Caixin Global, the central government is pressing local authorities to reduce energy consumption as a part of a national green transition strategy to lower emissions of climate-changing greenhouse gases. Beijing aims to reduce national energy consumption per unit of GDP by 13.50 per cent by 2025 besides cutting carbon emissions by 18 per cent for which local Governments have been given specific reduction goals.

In a document issued by the National Development and Reform Commission in August, Zhejiang was amongst several provinces receiving a ‘second-level warning’ which means they face severe challenges to meet the energy targets. Following the order, several publicly traded companies have disclosed production halts and the industry at large has expressed concern as they face short-term business losses due to the production halts.