Chinese authorities are considering imposing a lockdown in Beijing, after confirmed Covid-19 infections in the country’s capital exceeded 100 on Wednesday, April 27. But after a much-criticized month of isolation in Shanghai, that option could come at a very high economic and political cost.
At least 113 people have been diagnosed with Covid-19 in the Chinese capital, health authorities announced on Wednesday, April 27.
Pressure is mounting on local officials to contain the rate of infection. Some 1,300 kilometers away, in Shanghai, China’s largest city, a strict lockdown has already been imposed on the population for the past month in an attempt to stop the spread of the highly contagious Omicron variant.
Avoid the Shanghai Mistakes
Beijing’s picture could be bleaker, as the latest figures in the Chinese capital do not include cases detected during the wave of tests launched last Sunday, April 24. The authorities, in effect, decided that the city’s 21 million residents must undergo three tests over five days.
The local government hopes to avoid repeating the mistakes of Shanghai at all costs: the tests only began there after infections exceeded 1,000, too late to contain the epidemic without resorting to the heavy artillery of the ‘Covid zero’ policy, which translates into strict confinement.
The drastic measures still in place after a month prompted a rare public expression of anger in communist China, led by a regime that has little tolerance for political dissent.
The Beijing authorities insist that a Shanghai-style isolation will not be imposed, but admit that “the epidemic situation is complex and serious,” said Tian Wei, a spokesman for the local administration, on Tuesday, April 26.
However, some restrictions are already in place. This is particularly the case in Chaoyang district, where the majority of cases have been recorded in the capital. It is one of its most popular and important areas, housing most of the foreign embassies, as well as luxurious western shops and elegant bars and restaurants.
It is now an unusually quiet area. Several blocks of buildings have been sealed off and the streets are almost deserted, the ‘South China Morning Post’ reported. Loudspeakers inside supermarkets have been broadcasting messages assuring the population that the stalls are well stocked and that there will be no shortage of products as happened in Shanghai, which accentuates an unusual atmosphere in the area, highlighted ‘The New York Times’ .
Economic impact in China and beyond its borders
Local authorities in Beijing are not the only ones hoping to have reacted quickly enough: the national government is also not interested in hearing about a possible full lockdown of the capital. It’s not clear that the country, or even the world, can afford it after more than two years of restrictions.
From an economic point of view, the measures imposed in Shanghai have shown that China’s ‘Covid zero’ policy has a significant cost. While its actual impact has yet to be determined, “we know that in Shanghai, the local economy, local shops and restaurants, for example, suffered a lot, as did port activity. And that will have an impact on the supply chain.” value and in spare parts exports,” explained Mary-Françoise Renard, a specialist in Chinese economics at Clermont Auvergne University.
“We must not forget that Shanghai is the main supplier of parts for the global auto industry,” added Xin Sun, a specialist in Chinese economic policy at King’s College London.
Data on economic activity in Shanghai from last January 1 to this April gives an idea of how the long confinement caused economic damage. “These figures show that after sustained growth in the first two months, there has been a sudden stop in March, although the strictest measures, such as total confinement, were only implemented in April. Therefore, negative growth is expected in April,” Xin Sun said.
A lockdown in the Chinese capital “would of course increase the impact of these measures, even if Beijing does not have the economic importance of Shanghai,” Renard stressed. According to the expert, it would be especially negative news for the service sector, which represents “83 percent of Beijing’s economic activity.”
A confinement in the city would undoubtedly be the death sentence for the government’s goal of 5% growth by 2022. “Shanghai’s measures have already led the IMF (International Monetary Fund) to cut this estimate, and a similar situation in Beijing would confirm that China must downgrade its forecasts considerably,” said Frédéric Rollin, investment strategy adviser in charge of the Chinese economy at Pictet Asset Management.
The interruption of activity in two of the main economic and political centers of the country “will probably also have a butterfly effect outside the borders of China,” Renard stressed.
Especially in the current context of rising prices. “There have been a multitude of inflationary shocks since the beginning of the pandemic: the paralysis of international trade, the increase in energy prices, the war in Ukraine, to which must be added the interruption of exports due to the measures by Covid-19,” added Rollin.
Politically impossible?
But China’s headache is not only economic, it is also political. “With Beijing, you also have to consider the political repercussions of a shutdown,” said Zeno Leoni, an expert on China affairs at King’s College London. The country’s capital is the only city “where the Chinese Communist Party does not want to give the impression that it might be losing control,” he stressed.
And with the Omicron variant, neither scenario seems to be satisfactory. On the one hand, the failure to impose measures could force the government to deal with the uncontrolled spread of the virus. On the other hand, a strict lockdown could push the population of Beijing to the limit and provoke their anger, as in Shanghai, where residents are strongly opposed to the ‘Covid zero’ policy.
“If the anguish of people in Beijing and Shanghai were to come to light, it would discredit the official rhetoric that China handled the pandemic better than Western countries. And it would be unacceptable to the authorities,” Xin Sun said.
Even more so in 2022, a very important year for the nation’s president “The 20th Congress of the Chinese Communist Party, during which Xi Jinping is about to be re-elected, takes place this fall in Beijing. And the regime wants at all costs to prevent such a historic event from taking place in a city traumatized by another strict lockdown,” Leoni explained.
According to the expert, there are two possible scenarios for the Chinese capital: “Either the authorities are convinced that they can end the pandemic in Beijing with a total confinement, but briefly, and they will impose it absolutely (…) Or the situation in Shanghai will continue to drag “, which raises fears that anger will also rise in the capital. In this case, the authorities could try to avoid locking up all the inhabitants at the same time,” said the sinologist.
But there could be one last option: recognize that China’s ‘Covid zero’ policy is not as effective when it comes to the Omicron variant, and thus adopt a more flexible strategy. For Xin Sun, this would be impossible: “Xi Jinping has made this policy his own, and abandoning it would mean that he made a mistake, which is unimaginable,” the expert predicted.
Article adapted from its original in French
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