China announced on Saturday that it would stick “unwaveringly” to its zero-covid policy, dampening investors’ hopes of easing. This week, stock markets were on fire after rumors that health measures could be eased.
China is the latest major economy to use an extreme health protocol, which won’t prevent cases from rising as winter approaches.
The zero-covid policy in place in this country for almost three years has resulted in repeated incarcerations, large-scale PCR tests and mandatory quarantine on arrival from abroad, so it will continue.
“Currently, China still faces the dual threat of imported infections and domestic infections,” National Health Commission spokesman Mi Feng told a press conference. “.
Rise in cases
China reported 3,659 new infections on Saturday, most of them asymptomatic, against 2,000 new positive cases on Wednesday, the spokesman said, adding that “we must continue to put people and lives first”.
With outbreaks detected in more than 50 cities, the number of people quarantined in the country is now at its highest since it took control of Shanghai in the spring, according to the firm Capital Economics.
>> Review the 7:30pm report on the situation in China in mid-October:
In the south, the semi-autonomous region of Macau announced public screening of its 680,000 residents on Tuesday. In Canton (South), a partial curfew was imposed in several districts on Monday.
At the other end of the country, explosions have been detected in cities in the northeast near the border with Russia and North Korea.
Chinese authorities locked down 600,000 people who live around a factory that makes the majority of the world’s iPhones for a week on Wednesday after a flight of workers worried about an outbreak of Covid-19. The economic zone (hub) around Zhengzhou Airport, where the plant is located, employs more than 200,000 people.
>> Read More: China controls the area around the world’s largest iPhone factory
Stock market boom
Since the beginning of the week, financial markets have been in full swing after the first rumor reported by Chinese investment funds about the lifting of health measures in China to ease restrictions in March 2023.
In the process, a former Chinese health official saw an easing “likely” in the coming months, particularly as quarantines for travelers to China were eased.
In the world’s second-largest economy, luxury stocks, materials and technology sectors were the better performers on Friday.
However, experts have urged the stock markets to be very cautious. The fall should be felt on Monday.
>> Read More: In China, rumors of an end to prison terms are fueling stock markets
Till when covid zero?
This lost the confidence of the investors. But it begs the question, how long can Beijing continue to ignore the impact of its zero-covid policy on the economy? That may be until the political cost of reopening is deemed to outweigh the economic cost.
Officials point to China’s low death toll from Covid-19 in international comparisons, and the Chinese Communist Party describes itself as the protector of the people. Only 5,000 deaths have been reported in the country.
If reopened quickly, the death toll could rise because the population is less susceptible to the virus, but because of less effective Chinese vaccines and an uncertain health infrastructure.
The zero-covid policy has led to a massive mobilization of resources and individuals, creating a bureaucratic monster that will take time to dismantle.
Slow and gradual reopening?
China’s reopening, when it begins, is expected to be slow and gradual. From this perspective, the country should wait for new vaccination campaigns, as well as the adoption of more effective vaccines.
Once verified, removal of the measures will take several months. So the end of covid zero is not tomorrow.
Radio subject: Michael Beuker
Web adaptation: ats with jfe
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