China’s inability to control the sudden spike in COVID cases has exposed the limitations of its zero-COVID policy
There is no doubt that China’s zero-COVID approach has helped save many lives. It also kept the Chinese economic growth going when the rest of the world fumbled in 2020 and 2021. They have not seen the devastating losses suffered by countries such as India, the United States, Brazil, or Russia and the big worry for the Chinese leadership is the possibility of a surge in deaths if they relaxed controls. But the strict controls have ensured that the Chinese population’s have lower immunity towards more transmissible variants . As it is, China’s vaccination record has been spotty. Government data shows that 66 percent of people over 80 have been fully vaccinated, while only 40 percent have got a booster shot. For reasons unknown, Beijing has also adopted a restrictive attitude towards importing foreign vaccines which have been updated to fight the Omicron variant. A Bloomberg Intelligence report says that a full reopening at this point could lead to 363 million infections, some 5.8 million people being admitted into ICUs and almost 620,000 deaths. As a result, it says that China will adopt a slow exit from its zero-COVID policy which could extend beyond 2023. The report estimates are derived from the experience and data of the US and Europe where a full-blown Omicron outbreak led to a quarter of the people being infected. As of now, the Chinese authorities are determined to maintain their zero-tolerance policy towards COVID infections though there have been some changes that have eased the tough measures such as sweeping lockdowns and repeated mass testing. The Bloomberg Intelligence report also says that China needs to push its vaccine booster shots more and one problem it confronts is the lack of adequate coverage for the elderly. At the beginning of November, the Chinese leadership declared that they would stick to their zero-COVID approach, but adopt a more targeted approach. The Politburo Standing Committee, chaired by Xi Jinping, said that they expected a larger wave of infections in winter and expected the tough measures to remain in place till spring of 2023. The dynamic zero policy features repeated mass testing, travel restrictions, and snap lockdowns that can last weeks or months. Urumqi, the capital of Xinjiang, has been under lockdown for three months.
More than 80 Chinese cities are battling high levels of infection, compared with 50 cities during the Shanghai shutdown which lasted 60 days.
But the meeting led to the adoption of new rules to “optimise and adjust” the policy to minimise the impact on people’s lives and the economy. A circular by the government stressed the importance of preventing imported cases and domestic resurgences. Lockdowns are now placed on buildings and neighbourhoods, rather than entire cities as was the case with Shanghai earlier this year. The new measures called for cutting COVID quarantine periods for close contacts and inbound travellers. The categorisation of areas was reduced from “high, medium, and low” to just “high and low”. The circular also called for steps to redouble efforts “to rectify one-size-fits-all approach and excessive policy steps” to prevent needless disruption. The problem has been with the fact that the implementation of policies by local authorities has featured excessive zeal as local officials were often punished for outbreaks. Local officials have tried targeted measures, but found that Omicron’s effects can be overwhelming and were compelled to institute larger lockdowns. China needs to gear up its vaccination programme and hospital capacity before it can safely alter its policy.
The Chinese authorities are determined to maintain their zero-tolerance policy towards COVID infections though there have been some changes that have eased the tough measures such as sweeping lockdowns and repeated mass testing.
As it grapples with COVID, the government is struggling to stabilise the Chinese economy. A 16-point package was rolled out earlier in November to help the embattled real estate developers. Now state-owned banks have joined together to strengthen the finances of the troubled property sector by offering some US$30.7 billion in credit lines. But all these measures may not be sufficient till there is a broader optimism over reopening and the direction of economic policies. But this is not China’s only problem, youth unemployment numbers which showed that one-fifth of the 16-24 age group people were out of jobs is alarming. The numbers are higher than in the US, Europe, and Japan and many of those looking for jobs are university graduates For the world, the war in Ukraine and uncertainty in global supply chains resulting from the disruption of production in China could further dim the outlook for world economic growth. Unlike the Global Financial Crisis of 2008, Beijing, which has driven more than one-fifth of the global GDP growth, is unlikely to be the locomotive of growth that helps pull out the global economy from recession. In a report issued this week, the International Monetary Fund said that China had made an impressive recovery from the initial impact of the pandemic, but its growth has since “slowed and remains under pressure.” It said that in the near term “a recalibration of the COVID strategy, including an acceleration in vaccination and further action to end the property sector crisis would support growth.”
The war in Ukraine and uncertainty in global supply chains resulting from the disruption of production in China could further dim the outlook for world economic growth.
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Manoj Joshi is a Distinguished Fellow at the ORF. He has been a journalist specialising on national and international politics and is a commentator and ...Read More +