China’s Covid Zero Case Policywhere includes lockdowns and repeated mass tests in the populationproves to be expensive for the country’s economy, experts warn today, a day after President Xi asked that this process continue.
According to official figures, Covid’s zero-sum policy has allowed China to reduce its death toll to a short time. more than 5,000 deaths since the pandemic began. Just If a Covid case occurs, the authorities impose strict restraining measures.
For more than a month, Shanghai’s 25 million people have been under siege following an outbreak of the epidemic, with the shadow of a lockdown hovering over the capital, Beijing..
Every new outbreak of Covid in China leads to free and systematic diagnostics among residentsas well as to varying degrees restrictive measures that have an impact on the economy.
While some cities tend to generalize diagnostics every 48 hours, extending the measure nationwide could cost China up to 2.3 growth units this year, warns Nomura Bank.
From an economic point of view, this risks having a “significant” impact on logistics and population movements in return for “limited” benefits and “increased” costs, which will undermine growth, according to Nomura. From his side, international credit rating firm Fitch has revised its growth forecast for China to 4.3% this year (up from 4.8% previously).
China has set a growth target of “around 5.5%” this year after 8.1% in 2021. Some economists doubt that the Asian giant will achieve its goal, citing the deteriorating health situation, the war in Ukraine and the crisis in the real estate market.
With voices calling for easing restrictions in recent months, President Xi Jinping on Thursday called for a continuation of Covid’s zero-tolerance policy. and to “resolutely fight” anything that “challenges” this strategy, according to the New China (Xinhua) news agency.
The communist regime considers its health policy a proof of the superiority of its political systemin contrast to the outbreak of the pandemic in the rest of the world that has cost the lives of millions of people.
Today, the main article in the official newspaper of the Communist Party, the People’s Daily, counters the accusations that China’s coronavirus policy is causing turmoil in the world economy and trade.
«Some American politicians have repeatedly attacked and slandered China’s measures to prevent and control the pandemic and try to hold China accountable for the so-called disruption of global supply chains“, He said, without naming these politicians. According to the article, China puts “life first” and, although the pressures on its economy have increased, the country can overcome the difficulties.
Asian stocks fell today, amid concerns about a blow to growth from Chinese zero-tolerance policy at Covid. The broader MSCI Index for Asia-Pacific equities outside Japan fell 2.87% to its lowest level since March 16. Chinese blue chips fell 2.53%, while the benchmark index in Hong Kong fell 3.89%.
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