Moody's Shutting Consulting Business, Laying Off Employees In China

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Moody's is closing its China consulting business and laying off employees in multiple locations across the country, according to The News International.

Moody's Corp began winding down the Moody's Analytics business in China this week, according to people who spoke on the condition of anonymity because they are not authorised to talk to the media.

According to one of the sources, the move, which was first announced internally on Monday, has affected more than 100 employees across Moody's Beijing, Shanghai and Shenzhen offices.

The total headcount for the business unit could not be determined immediately. According to the source, Moody's credit rating business will continue to operate in the world's second-largest economy.

Moody's said in a recent earnings call that it was “taking steps to align our global workforce with current and anticipated economic conditions,” according to an emailed statement from a company spokesperson.

Notably, China's zero-Covid policy and sporadic lockdowns are driving multinational firms away from its borders, according to a media report citing a European Union Chamber of Commerce report.

According to the Financial Post, the EU Chamber of Commerce recently released a report stating that China has become less predictable, less reliable and less efficient, prompting several multinational firms to consider shifting their operations out of China to other markets.

According to a survey conducted by the European Chamber of Commerce, 50 per cent of western firms reported that doing business in China had become more politicised in 2021 than in previous years.

“A growing number of European businesses are putting China investments on hold and re-evaluating their positions in the market as they wait to see how long this uncertainty will last and many are looking to other destinations for future projects,” said Bettina Schoen-Behanzin, Vice President of the European Chamber.

According to the Financial Post, the departure of multinational corporations from China indicates a decline in trust.

According to reports, Google announced on 3 October that it was shutting down the Google Translate service in mainland China, citing low usage in the country.

Google's announcement adds the American tech giant to the list of companies that have left China. Amazon, LinkedIn, Yahoo and Microsoft are just a few of the companies that have ceased operations in China.

Meanwhile, tens of thousands of migrant workers have fled the country's largest iPhone factory in Covid-ravaged Zhengzhou, amid a lockdown triggered by the Covid outbreak.

According to videos shared on Chinese social media, people were jumping a fence outside the Foxconn plant in the central city of Zhengzhou.

It had previously been reported that a number of workers had been quarantined due to an outbreak of the disease.

According to McDonell, Zhengzhou Foxconn employs approximately 300,000 people and produces half of the world's iPhones. Amid the chaos of the Covid lockdown and food shortages, videos on Douyin, a Chinese video-hosting service, show many migrant workers from Henan province returning home on foot... because public transportation is unavailable due to the lockdown.