Beijing closed parks, shopping malls and museums on Tuesday while more Chinese cities resumed mass testing for COVID-19, as China grapples with a fresh nationwide surge in cases that have raised concerns about its economy.
China reported 28,127 new local cases nationwide by Monday, near the daily peak of infections in April, with cases in the southern province of Guangzhou and the southwestern municipality of Chongqing accounting for about half the total. In the capital Beijing, cases have hit a new record, prompting calls for more residents to stay put.
Two new deaths were attributed to COVID-19, compared with three over the weekend, the first in China since May.
The latest wave is testing recent changes China has made to its zero-covid policy, which calls on authorities to be more targeted in their austerity measures and steer away from the widespread lockdowns and testing that have strangled the economy and frustrated residents.
Even after those changes, China still has the world’s strictest COVID restrictions, and the crackdown in Beijing and other cities has renewed investor concerns about the economy, sending global stocks and oil prices lower overnight.
Nomura analysts said on Tuesday that their internal index estimated that places representing about 19.9% of China’s gross domestic product were under some form of closure or restriction, up from 15.6% last Monday.
Beijing warned on Monday that it faces its most severe tests of the COVID-19 pandemic and tightened rules on entering the city, requiring arrivals from elsewhere in China to undergo three days of COVID tests before being allowed in. to leave their accommodation.
Many museums have been closed, and on Tuesday places such as the Happy Valley theme park and the city’s vast Chaoyang Park, popular with joggers and picnickers, said they would close because of the outbreak. Beijing reported 1,438 new local cases, up from 962 on Sunday.
The central city of Wuhan, where the virus was first discovered in early 2020, issued a notice on Tuesday urging its residents to travel only between home and work.
China’s Vice Premier Sun Chunlan, who has been in charge of the zero-COVID policy, visited Chongqing on Monday and urged authorities there to follow the measures and bring the outbreak under control, the municipality said.
Investors had hoped that China’s more focused enforcement of zero-COVID barriers could herald more easing, but many analysts caution against being too bullish.
Inside China, many businesses, especially customer-facing ones, fear they won’t be able to survive until next year as customers continue to hold on to their cash.
“The real picture may not be as rosy as it seems,” Nomura analysts said in a separate note, saying they only expected the recovery to accelerate after March next year, when the reshuffle of China’s top leaders is complete.
“Reopening could be a back-and-forth as politicians may back off after observing a rapid increase in cases and social disruptions. As such, local officials may be even more reluctant to be the initiators when trying to outline Beijing’s true intentions, ” wrote Nomura. . .
© Thomson Reuters 2022.