Offices and factories in China are leaving lights and air-conditioners switched on to fake electricity consumption and other metrics, according to an investigation by Caixin.
Fraudulent practices to fulfil work targets
To fulfil tough quotas set by local governments, companies have resorted to practices such as switching on manufacturing equipment even when production is not going on, doctoring staff rosters, and even training workers to lie to inspectors when necessary, Caixin reported.
China is under pressure to get the economy back on track now that the spread of Covid-19 appears to be waning.
No new Covid-19 cases have been reported in the country outside Hubei province for the third day since Sunday, March 8.
According to Bloomberg, the viral outbreak has impacted both manufacturing and non-manufacturing sectors in China heavily, with the country registering the lowest manufacturing activity on record in February.
With millions of workers and consumers under quarantine, the world's second-largest economy has been operating below capacity for the past few months.
Electricity consumption a barometer to indicate business resumption rates
Electricity consumption is frequently used by Beijing as a barometer for businesses picking up.
Chinese state media Xinhua has cited the rise in power consumption of businesses in Guangdong province to 80 percent of pre-shutdown levels as proof that business operations are getting back to normal.
According to Bloomberg, a factory owner said they were able to achieve 20 percent of their usual consumption, which was a quota given by officials.
Not able to actually resume work
However, other smaller companies were not able to start work due to various reasons.
For instance, many migrant workers had gone back to their hometowns, and they face a 14-day mandatory quarantine once they return to the cities where they work.
These companies had turned to switching on their electric equipment to meet business resumption quotas, two factory owners told Bloomberg.
Resuming work presents risk of viral outbreak
In addition, Caixin noted that while several factories in the industrial city of Botou in Hebei had reopened their doors, production had not resumed.
This is because the local government had not allowed factories to resume work for fear of risking a viral outbreak, a factory worker said.
In the meantime, the local government had asked him to falsely report the number of employees who were back at work.
Faking data may lead to policy missteps
In response to Caixin's inquiries, the Botou government said factories could only resume production after officials made sure proper virus control measures were in place.
But even if factories resume production, they face further difficulties in getting raw materials delivered and sending out their goods, as many rural roads still remain blocked, a source told Caixin.
And should the economic inactivity persists, millions of small and medium Chinese firms face the risk of going under due to a lack of revenue to cover fixed expenses, Bloomberg reported.
In addition, the falsifying of data to report to senior government officials increase the risk of policy missteps by Beijing, due to the inaccuracy of the barometers used by economists and policy makers alike.
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