December 1, 2022

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China rushes to control new Covid cases across the country

China rushes to control new Covid cases across the country

Workers in Shanghai’s Changning District erected a fence on October 7, 2022, around a neighborhood lockdown following reports of new Covid cases.

Hector Rietmal | Afp | Getty Images

BEIJING – Cases of the new COVID-19 virus are increasing across mainland China, prompting many local authorities to tighten control over movement.

About 4.8% of China’s GDP was negatively affected by Covid controls as of Monday, according to a model from Nomura. That’s up from 4.3% last week.

Three districts in downtown Shanghai on Monday ordered the temporary closure of entertainment venues such as Internet cafes, according to official announcements.

Several schools in the central Chinese city of Xi’an on Tuesday canceled in-person classes for most students, according to a local media outlet. The hashtag about the sudden closure was one of the most popular items on Weibo, the Twitter-like social media platform in China.

The Xi’an Department of Education did not immediately respond to CNBC’s request for comment.

The measures come in the wake of the week-long National Day holiday that ended on Friday, as “the overall situation of the COVID-19 virus in China appears to have materially deteriorated,” Nomura’s chief China economist Ting Lu and team said in a note on Monday.

The report noted the shutdown since October 4 of a popular tourist city in southern Yunnan Province, the Xinjiang ban on people leaving the area due to the local COVID-19 outbreak, and the lockdown of Haikou City, Hainan Province on October 6.

Nomura analysts said the seven-day moving average of locally transmitted COVID-19 infections with symptoms doubled from 136 on October 1 to 305 on October 9.

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Mainland China reported 427 new cases of COVID-19 on Monday in more than 20 provincial-level regions in the country. When adding asymptomatic infections, the number of daily cases exceeded 2,000 and came from nearly all of the 31 county-level regions.

Domestic tourism revenue during this month’s holiday — China’s last public holiday this year — reached 287.21 billion yuan ($40.45 billion), according to China’s Ministry of Culture and Tourism. This is down from last year and remains well below 2019 levels, the ministry said.

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However, online booking platform Trip.com said nearly two-thirds of vacation requests were for travel or nearby stays, spending on which was up 30% year-over-year.

Strict virus testing requirements and the risk of not being able to return home have discouraged domestic long-distance travel on the mainland.

This contrasts with an increase in overseas travel as Hong Kong, Taiwan, Japan and South Korea have joined other countries in relaxing quarantine and virus testing rules.

Stick to Zero Covid

October of this year is a particularly politically sensitive time for China as president Xi Jinping He is expected to consolidate his power in An important meeting of the ruling Communist Party of China next week.

Prior to that conference, the central government authorities confirmed their dynamic policy of non-proliferation of COVID-19 in an article published on Monday in the People’s Party Daily.

State broadcaster CCTV summed up the article on its nightly news program by emphasizing the need for a more targeted approach to controlling Covid.

“We must remain vigil against the spread of the epidemic, overcome paralyzed thinking, war fatigue, risk mindset, and take it easy attitude – and do the work of epidemic prevention and control,” the radio said. CNBC’s translation of the Chinese.

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