BEIJING, Nov. 24 (BNA): China reported a record high number of COVID-19 infections Thursday, as cities across the country imposed local lockdowns, mass testing and other restrictions fueling frustration and darkening expectations for the world’s second-largest economy.
Reuters reports that a resurgence of infections, nearly three years after the outbreak began in the central city of Wuhan, is casting doubt on investors’ hopes that China will ease its strict anti-coronavirus policy soon, despite more targeted measures recently. .
The restrictions affected closed residents as well as production at factories, including the world’s largest iPhone factory, which has been rocked by clashes between workers and security personnel in a rare show of opposition.
“How many people have the savings to support if things keep stalling?” asked a 40-year-old Beijing man surnamed Wang, a manager in a foreign company.
“And even if you have the money to stay home every day, that’s not real life.”
The streets of Chaoyang, the capital’s most populous district, are becoming increasingly empty this week.
Sanlitun, an upscale shopping district, was virtually silent Thursday, however, due to the buzz of e-bikes of delivery riders delivering meals to those working from home.
Brokerage firm Nomura cut its forecast for China’s fourth-quarter GDP to 2.4% year-on-year from 2.8%, and lowered its full-year growth forecast to 2.8% from 2.9%, well below China’s official target of 5.5%. % this year.
“We believe that reopening is still likely to be a protracted process with high costs,” Nomura wrote, also lowering the forecast for Chinese GDP growth for next year to 4.0% from 4.3%.
China’s leadership has stuck to zero COVID, a signature policy of President Xi Jinping, even as much of the world is trying to come to terms with the virus, saying it is necessary to save lives and prevent the medical system from collapsing.
Acknowledging the pressure on the economy, the cabinet said China will use timely cuts in banks’ cash reserves and other monetary policy tools to ensure adequate liquidity, state media reported Wednesday, hinting that a cut in the reserve requirement ratio may come soon. .
Chinese stocks fell on Thursday, as concerns about record high domestic daily COVID-19 cases outweighed optimism about new economic stimulus, and lost ground to a rally in global stocks to their highest levels in two months.
A large number of checks and locks
The 31,444 new domestic COVID-19 infections on Wednesday broke the record set on April 13, when the commercial hub of Shanghai was paralyzed by a citywide lockdown of its population of 25 million that will last two months.
But this time, outbreaks are large and far between, with the largest in the southern city of Guangzhou and southwest Chongqing, though hundreds of new infections were reported daily in cities such as Chengdu, Jinan, Lanzhou and Xi’an.
Nomura estimates that more than a fifth of China’s GDP is in lockdown, a larger share of the British economy.
“Shanghai-style full lockdowns could be avoided, but may be replaced by more frequent partial lockdowns in a growing number of cities due to rising numbers of COVID cases,” its analysts wrote.
While official case numbers are low by global standards, China is trying to stamp out every chain of infection, an even more formidable challenge as China faces its first winter battling the highly contagious Omicron variant.
China recently began relaxing some standards around mass testing and quarantines, as it looks to avoid sweeping measures such as citywide lockdowns.
Instead, cities have been using more localized and often unannounced lockdowns. Several people in Beijing said they had recently received notices that their apartment complexes would be closed for three days.
The far northeastern city of Harbin declared some areas to be closed on Thursday.
Many cities have returned to mass testing, which China had hoped to scale back as costs rose. Other countries, including Beijing, Shanghai and the city of Sanya on Hainan Island, have limited movements for new arrivals.
Downtown Zhengzhou, where workers at the Foxconn (2317.TW) mega-plant that makes iPhones for Apple Inc (AAPL.O) have staged protests, announced five days of mass testing in eight districts, becoming the latest to salute the daily tests of millions of people. population.
A sharper-than-expected slowdown in China, which is hurting domestic demand in particular, would reverberate in countries such as Japan, South Korea and Australia, which export hundreds of billions of dollars worth of products and goods to the world’s second-largest economy.
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