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China’s Silicon Valley, Shenzhen ordered to stop production to control Covid


People wait in line to take nucleic acid samples in Shanghai, China, March 12, 2022.

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BEIJING – Mainland China is facing its worst Covid-19 outbreak since the country contained the pandemic in 2020, with major cities rushing to limit business activities.

Shenzhen, the largest city in the manufacturing hub of Guangdong province, has asked all businesses not related to essential public services production suspension or let employees work from home for a week starting Monday. According to the report, the production halt includes Apple manufacture Foxconndid not immediately respond to CNBC’s request for comment.

The city, sometimes referred to as China’s “Silicon Valley,” has shut down public transport and begun a third round of citywide testing. Shenzhen has reported more than 400 confirmed cases since the end of February.

The numbers and case numbers across China pale in comparison to other countries. However, the rapid increase of cases in recent days has prompted local governments to rush to control the outbreak as China seeks to maintain its zero-Covid strategy.

Shanghai, the coastal metropolis that is home to many foreign businesses and financial firms in China, has moved schools to online classes. Some neighborhoods have locked doors and conducted mass testing, and residents are often unable to leave until the results are negative.

The city on Saturday told residents not to leave Shanghai unless absolutely necessary. More than 600 confirmed cases have been found since the end of February.

Jilin province in northern China reported an overnight surge over the weekend to more than 1,000 locally transmitted new coronavirus cases, for a total of more than 2,900 cases this month as of Sunday .

In total, mainland China reported 1,437 new confirmed cases as of Sunday – only 100 were attributed to travelers from abroad – out of a total of 8,531 active cases in the country. That is the most since March 2020. No new deaths were reported.

Hong Kong, a special administrative region located just across the border with Shenzhen, has faced a surge of Covid cases over the past few weeks. The region has the highest number of new Covid-related deaths globally per million, according to Our World in Data.

The outbreak in Hong Kong stemmed from a highly contagious omicron variant, which later spread to the mainland.

The city of Beijing is in a state of alarm

The Beijing capital government on Sunday said it had identified six sources of transmission for a handful of the latest cases in the city, mainly reported around the central and eastern areas of the city. Local authorities said anyone returning to Beijing must not attend gatherings for seven days after arrival.

For months, the capital had one of the strictest Covid control policies in the country. Visitors must present a negative Covid test taken 48 hours before entering Beijing and take another test within 72 hours of arrival. If their 14-day travel history shows they have visited a locality with a confirmed case, they will not be allowed into the city.

Following the arrival of Covid-19 in Wuhan at the end of 2019, mainland China closed more than half of the country in February 2020 to control the outbreak. Domestically, the virus was brought under control within weeks, but Covid spread abroad in a global pandemic.

As of Monday, South Korea and Germany had the highest number of new cases in 28 days, 5.2 million and 4.8 million respectively, according to Johns Hopkins data, according to Johns Hopkins data. The US has recorded the most deaths, with more than 967,000 as of Monday morning Beijing time.

Zero-Covid won’t go away

Mainland China has maintained a strict “zero-Covid” policy for the past two years. Travel restrictions and the possibility of rapid closures have weighed on domestic tourism and service businesses, dragging down consumer spending.

An annual parliamentary meeting that ended on Friday showed no sign that the central government plans to ease its Covid control policy, although official statements in recent months have added additional details. terms like “dynamic”.

Deputy Prime Minister Sun Chunlan said at the government meeting on disease control on Saturday that the country should continue to adhere to a “dynamic” zero-Covid policy and should take all measures to contain it. large-scale re-emergence of the virus.

Her remarks, carried by state media, ended with a call to prepare for the highest-level meeting of the ruling Communist Party of China later this year. Chinese President Xi Jinping is expected to receive an unprecedented third term at the meeting.

Read more about China from CNBC Pro

Abandoning zero-Covid “could now be seen as an admission that this strategy didn’t work in the first place,” Nomura chief economist Ting Lu said in a Friday note.

“The next 12 months are a critical period for a decade-long leadership change that is motivating top leaders to stick to the status quo to avoid making policy mistakes,” he said. “. “The overwhelming image of many Hong Kong Covid patients being treated outside of hospitals further convinced Chinese officials and the public that ZCS was China’s only viable solution to the coronavirus.”

China’s Center for Disease Control and Prevention published a study in November That said, shifting to other countries’ strategy of coexistence would likely lead to hundreds of thousands of new cases daily and wreak havoc on national health systems.

However, Lu said, the economic costs of the zero-Covid strategy are increasing while the benefits are decreasing.

“Amidst the shutdowns and travel bans across China, more and more individuals feel oppressed, become tired, unemployed or underemployed, and have spent all their savings to the point where they have lost their lives,” he said. must reduce spending”.



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