China's Covid controls are pulling more of the economy

Chinas Covid controls are pulling more of the economy

November 10, 2022: China’s Covid situation is only worsening, which prevents the country from taking out the virus and relaxing controls.

The daily case count increased to six-month highs more than the weekend. Guangzhou is indefinitely delaying its auto show that was supposed to kick off in the coming week. And schools in Beijing are waffling more than whether to shift classes online, social media said.

On Monday, Covid controls negatively affected 12.2% of the national GDP, up from 9.5% a week ago in China, according to Nomura’s model. The Japanese bank stated over one-fifth of China’s population was subject to control measures.

The southern province of Guangdong is difficult to reach, with cases primarily concentrated in one district. Recent Covid infections have been reported in over 20 of China’s 31 province-level regions.

“One thing is obvious, a lot of business events have been canceled and delayed,” Klaus Zenkel, vice president at the EU Chamber of Commerce and chairman of its China chapter, said on Tuesday.

“People do not dare to travel. Too many restrictions,” he stated, noting how companies from Guangzhou and Shenzhen “could not join” China’s international import expo in Shanghai. “How to maintain customer relations when we cannot meet face to face?”

It was unclear whether there was any effect on factory production in the South China area.

The high impact of Covid on China’s economy came in a week in which many investors assumed that China would relax its stringent Covid policy.

On Saturdayfficials dispelled the rumors, which confirmed at a press conference that the present zero-Covid policy remains.

“We continue to believe that, whereas Beijing may fine-tune some of its Covid measures in the future weeks, those fine-tuning measures could be offset by local officials’ tightening,” Nomura’s Chief China Economist Ting Lu and a team stated in a report Monday.

Mainland China reported over 800 Covid infections with signs and over 6,600 without signs on Monday.

Other states have far higher daily case counts but prefer to live with Covid.

Chinese authorities have described related about the ability of the country’s strained healthcare system to handle an increase in Covid infections.

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China's Covid controls are pulling more of the economy
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China's Covid controls are pulling more of the economy
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China’s Covid situation is only worsening, which prevents the country from taking out the virus and relaxing controls.
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The Women Leaders
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