BEIJING: Mass testing of China’s vast population could spell new trouble for the economy, experts warned on Friday Beijing vowed to regain control of the narrative around zero-covid policy Which has throttled development and fueled anger in the entire country.
Leaders have taken a tough stand to stop the outbreak of the virus, lock down Shanghai – The country’s economic dynamism and largest city – and dozens of new cases in Beijing are gradually restricting movement.
Authorities have refused to bow down to growing public outcry over food shortages and spartan quarantine conditions in Shanghai, with top officials on Thursday pledging to “unwavering adherence” to zero-Covid and “fighting” against criticism of the policy .
The Chinese government has presented this strategy as evidence that it values human life above material concerns and can avoid the public health crises seen in other countries.
But the approach is stifling the economy and posing a formidable political challenge to the president. Xi Jinping,
He must now convince an increasingly volatile public, who has vented their anger over the lockdown on social media, that the trade-off between the economy and life is sustainable.
At Thursday’s meeting – attended by Xi – the country’s top officials pledged to “fight resolutely against all words and actions that distort, question or discredit our country’s disease control policies.”
Experts fear Beijing’s game plan will have a huge impact on the world’s second-largest economy.
Analysts nomura predicted on Friday that the massive testing mandate alone could cost up to 2.3 percent of annual GDP.
Shanghai’s 25 million residents have been tested multiple times, while some of Beijing’s 21 million people have also undergone repeated scrutiny – a policy the government has indicated to combat the highly permeable Omicron variant. To be extended to the whole country.
Nomura said a requirement that half of the world’s most populous country conduct a test every three days would cost about 0.9 percent of GDP, while any demand that 90 percent of the population do every two days. takes one test, will cost 2.3 percent.
Nomura’s chief China economist Ting Lu said restrictions could carry a “quite high” cost if extended across the country, while offering only “limited” benefits as hard-to-find Omicron tensions ease lockdowns in more cities. can trigger.
The grim prediction comes after Fitch Ratings cut its forecast for China’s full-year economic growth to 4.3 percent from 4.8 percent.
This is a far cry from the government’s official target of 5.5 per cent.
A key index of services sector activity fell to 36.2 in April, the second lowest on record, which some experts have said is a big indicator of the country in recession.
Leaders have taken a tough stand to stop the outbreak of the virus, lock down Shanghai – The country’s economic dynamism and largest city – and dozens of new cases in Beijing are gradually restricting movement.
Authorities have refused to bow down to growing public outcry over food shortages and spartan quarantine conditions in Shanghai, with top officials on Thursday pledging to “unwavering adherence” to zero-Covid and “fighting” against criticism of the policy .
The Chinese government has presented this strategy as evidence that it values human life above material concerns and can avoid the public health crises seen in other countries.
But the approach is stifling the economy and posing a formidable political challenge to the president. Xi Jinping,
He must now convince an increasingly volatile public, who has vented their anger over the lockdown on social media, that the trade-off between the economy and life is sustainable.
At Thursday’s meeting – attended by Xi – the country’s top officials pledged to “fight resolutely against all words and actions that distort, question or discredit our country’s disease control policies.”
Experts fear Beijing’s game plan will have a huge impact on the world’s second-largest economy.
Analysts nomura predicted on Friday that the massive testing mandate alone could cost up to 2.3 percent of annual GDP.
Shanghai’s 25 million residents have been tested multiple times, while some of Beijing’s 21 million people have also undergone repeated scrutiny – a policy the government has indicated to combat the highly permeable Omicron variant. To be extended to the whole country.
Nomura said a requirement that half of the world’s most populous country conduct a test every three days would cost about 0.9 percent of GDP, while any demand that 90 percent of the population do every two days. takes one test, will cost 2.3 percent.
Nomura’s chief China economist Ting Lu said restrictions could carry a “quite high” cost if extended across the country, while offering only “limited” benefits as hard-to-find Omicron tensions ease lockdowns in more cities. can trigger.
The grim prediction comes after Fitch Ratings cut its forecast for China’s full-year economic growth to 4.3 percent from 4.8 percent.
This is a far cry from the government’s official target of 5.5 per cent.
A key index of services sector activity fell to 36.2 in April, the second lowest on record, which some experts have said is a big indicator of the country in recession.