China doubles down on zero-COVID Policy after Reopening Rumours Global Markets

(CTN News) – On Saturday, China said it would “unwaveringly” adhere to its zero-COVID policy, dimming the outlook for international markets after their recent rise on expectations that Beijing would relax some of its virus-control measures causing economic harm.

China is the final big economy committed to an epidemic containment approach, enforcing sudden lockdowns, broad testing, and protracted quarantines despite the significant damage to companies and global supply networks.

On Friday, stock markets rose partly due to unfounded rumours that Beijing was about to make big adjustments to the policy or even set out a roadmap for a complete reopening.

However, the National Health Commission (NHC) spokeswoman Mi Feng said on Saturday that Beijing would “hold unswervingly to… the overall policy of dynamic zero-COVID,” putting an end to the rumours.

Mi said during a news conference that “China is still dealing with the combined danger of imported illnesses and the rise of local outbreaks.”

The disease control situation is still dire and challenging, he said. “People and lives must always come first,”

According to the NHC, China reported 3,659 new illnesses on Saturday, most of which were asymptomatic.

Despite making up a minuscule portion of the huge country’s population, the hundreds of domestic instances reported over the last week have prompted authorities to respond forcefully, often with disastrous or unpopular results.

Many employees fled on foot from the world’s largest iPhone plant after it was locked down in the central city of Zhengzhou, citing food shortages, bad treatment from their employer, Taiwanese tech giant Foxconn, and insufficient medical care.

Authorities in the northwest city of Lanzhou issued a rare apology on Thursday after a three-year-old child passed from carbon monoxide poisoning due to his refusal to get medical attention during a several-week Covid lockdown.

The use of “excessively layered” and “one-size-fits-all” restrictions in certain places was criticized by officials on Saturday, but they claimed that the overall zero-tolerance virus strategy was “right”.

Reopening rumours

Speculation that China would relax its strict regulations, which include a ten-day quarantine for visitors and a “circuit-breaker” on international passenger flights impacted by Covid, led to a rise in Chinese markets on Friday.

The Shanghai and Shenzhen stock exchanges saw 2.4% and 3.2% gains, while the Hang Seng Index finished more than 5% higher.

However, a reopening still seems far off, with regions contributing over 10% of China’s total GDP as of Thursday being subject to some increased viral limitations, according to an estimate by Nomura.

Additionally, the Japanese bank said that it viewed an “extremely modest possibility” of any policy easing “materially terminating (zero-COVID) before March 2023” and that any effects “would likely be quite limited.”

The third quarter of this year saw a comeback in China’s yearly economic growth to 3.9%, but many still believe Beijing will fall well short of its declared target of 5.5% annual GDP growth.

At a convention last month, President Xi Jinping, who has made combating the epidemic a pillar of the legitimacy of the governing Communist Party, praised zero-“major COVID good accomplishments” as he clinched a record-breaking third term in office.

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