Passengers wait to board a train at Hongqiao station in Shanghai on December 6, 2022.
Hector Retamal | afp | beautiful pictures
BEIJING — As mainland China eases many of its strict controls on Covid, analysts point out that the country is far from quickly returning to its pre-pandemic state.
National government announced sweeping changes on Wednesday to make it easier to travel within the country, keep businesses running and allow Covid patients to be isolated at home.
“These measures are very welcome for an economy that has been hit hard this year,” Nomura chief China economist Ting Lu and a team said in a report.
“However, we also warn that the path to a full reopening may still be slow, painful and bumpy,” they said. According to the report, the country does not appear to be well prepared for a large wave of infections, and the 0.13% infection rate puts the country far below what is needed for herd immunity.
Mainland China’s daily Covid cases, most of which are asymptomatic, rose to a record high above 40,000 at the end of November. Since then, the number has steadily declined as cities reduce requirements. virus check.
According to a report by Goldman Sachs on December 4, the road ahead for China to reopen could take months, with the possibility of infections increasing.
“With the majority of the population uninfected before reopening, lower vaccination rates for the elderly than in many other economies, and cultural similarities, we think reopening Hong Kong and Taiwan are best suited to mainland China,” said chief China economist Hui Shan and a team.
“Their experience shows that cases are likely to skyrocket upon reopening and persist for some time, with immunization rates for the elderly being the key to unlocking the pandemic,” the Goldman report said. safe return and mobility plummets as cases increase.”
In the past two months, Taiwan no longer requires international travelers to be quarantined upon arrival and says residents do not have to wear masks when going out.
60% of the population may have Covid
Last week, mainland Chinese authorities announced another effort to vaccinate the country’s elderly.
In the near future, about 60% of people could be infected, no matter how the policy is adjusted, Feng Zijian, former deputy director of the Chinese Center for Disease Control and Prevention, said on Thursday. Three in a talk at Tsinghua University. He says that number could eventually rise to 80% or 90%.
The new measures introduced by the health commission on Thursday focus on how to treat Covid patients at home and include a list of drugs.
Whether unnecessary or precautionary, local demand for related drugs has increased.
JD Health says online sales have increased for cold and fever medicines and related products. The company said its latest data showed trading volume for the week ending Monday increased 18 times compared to October.
Looking ahead, it’s pretty clear that China’s Covid policy is about to pass a turning point, said Bruce Pang, chief economist and head of Mainland China research at JLL.
He said that as of Wednesday, negative virus tests are no longer required to travel within China, while a large number of people usually travel around the upcoming Lunar New Year. That means there could be an increase in the number of Covid cases and China’s policy will never come back, Pang said.
Chinese travel booking site Trip.com said that after easing domestic travel policies, searches for tickets for the Lunar New Year, which fell at the end of January 2023, increased to the highest level in 3 years.
Not fully reopened yet
Health authorities emphasized on Wednesday that the latest changes do not mean a full reopening. No reduction in quarantine periods for international travelers and measures including negative virus tests are still required.
At the local level, the city of Beijing said on Wednesday night that people who want to dine at restaurants must still present negative virus test results within the past two days.
But it is taking longer to process virus test results due to the increase in positive cases, Beijing local media reported on Wednesday, citing an employee of the testing company. virus test. Since virus tests are done in batches of 10 people, if one person’s results are positive, the machine needs to process additional tests, the report said.
Goldman Sachs analysts expect China’s reopening – defined as a shift away from lockdown – to happen in the second quarter of 2023, according to a separate report on Wednesday.
An earlier-than-expected reopening will add further downward pressure to growth in the short-term but moderate upside risks to our full-year 2023 GDP growth forecast, the analysts said. I”.
They argue that any initial reopening will create a drag on the economy “due to increased infections, temporary labor shortages and supply chain disruptions.” increased response”.
Goldman forecasts 3% growth for the Chinese economy this year and 4.5% in 2023.
