The major luxury goods mall Beijing SKP, pictured here in 2021, said on Friday it would close – with no reopening date specified – after the city confirmed three Covid cases in a nearby apartment community.
Qilai Shen | Bloomberg | Getty Images
BEIJING — China has shown few signs of easing its zero-Covid control policies as the country continues to battle its worst outbreak in two years.
Some companies have resumed production in Shanghai and northern China. But the capital, Beijing, on Friday temporarily closed a major luxury shopping center and non-essential businesses in an area to control a continued spike in cases linked to the highly transmissible variant of omicron.
Top Chinese leaders said at a meeting on Friday that Covid and the Ukraine crisis have increased challenges and uncertainties for the national economy, according to state media. Chinese President Xi Jinping led the economic meeting, held regularly with Chinese leaders, known as the Politburo.
The leaders noted the new features of the mutation and said the country should stick to its “dynamic zero-Covid policy”, state media said.
This implies that Covid policy will not ease in the short term, said Bruce Pang, head of macro and strategic research at China Renaissance. He said the meeting reflected how stronger headwinds to growth were than expected, and noted that leaders called for more policy support for China to reach its GDP target of around 5.5. %.
Many investment banks have cut their Chinese GDP forecasts to as low as 3.9% following new Covid cases and checks.
Mainland China reported more than 5,600 new confirmed Covid cases with symptoms on Thursday, with the majority stemming from cases in Shanghai that had previously shown no symptoms.
The southeastern metropolis, home to the world’s busiest port, has kept residents mostly locked out for more than a month in a bid to control the local outbreak. Other parts of the country, including Beijing, have locked down neighborhoods, carried out mass virus testing and restricted travel in a bid to control new spikes in cases.
Beijing reported two new Covid cases with no symptoms and 47 with symptoms – similar to the daily tally for much of the past week. More than 15 other provincial-level regions reported new cases, including the export-heavy provinces of Shandong, Guangdong and Zhejiang.
Specific virus control measures may “sacrifice” the convenience of life for some regions and people, affecting the economy in the short term for some localities, said Liang Wannian, head of the Covid response expert group at the within the National Health Commission, during a press conference. Friday.
But it will allow the largest area and the largest number of people to work and live normally, for a profitable balance, he said.
Liang described the virus situation in Shanghai and Beijing on Friday as experiencing significant improvement. He said the dynamic zero Covid policy does not mean zero infections, because variants such as omicron mean authorities cannot guarantee that no cases emerge.
Shanghai factories pick up speed
Shanghai has tried to allow some large companies to resume production by releasing a list about two weeks ago of 666 companies that could be prioritized for work to resume.
Just over a third, or 247, of the companies are foreign-invested enterprises, the Commerce Ministry said on Thursday.
German automaker Volkswagen and American electric car maker Tesla has resumed production, the ministry said, noting that other foreign companies have applied to join the second group of whitelisted companies. The ministry said it would make every effort to ensure the resumption of work.
- U.S. chemical company DuPont said on Thursday that all of its manufacturing facilities in China were operating either under normal conditions or in a bubble. Early last week, the company said its manufacturing sites in Shanghai had yet to resume production.
- German chemicals giant BASF said most of its workers in Beijing have been working from home since Monday and most of its production sites in China, including Shanghai, remain operational, albeit with production volumes. reduced.
- On Monday, German automaker Volkswagen said it had started resuming production at its factory on the outskirts of Shanghai and its plants in Changchun, northern China, were increasing production volume. The company did not respond to a request for an update from CNBC on Thursday.
The city of Changchun in the northern province of Jilin began to resume normal activities on Thursday after weeks of confinement, according to an official announcement.
Getting truck shipments between ports and factories remains a challenge.
Merchants have had to pay more for logistics costs – now around 25% of selling prices, compared to 15% or 20% at the start of the pandemic – Diane Wang, founder and president of Chinese e-commerce site DHgate, said Thursday at CNBC. The company mainly works with small Chinese companies that sell overseas.
But with existing stocks, stay-at-home and lockdown orders would need to last at least three months to really affect businesses, she said.
Schools in Beijing closed on Friday, starting the upcoming Labor Day holiday a day earlier. The last day of the China Long Weekend Holiday is Wednesday, May 4. Many of the Covid cases in the city over the past week have been traced to schools.
The major luxury goods mall Beijing SKP announced on Friday that it would close – with no reopening date specified – after the city confirmed three Covid cases in a nearby apartment community. Beijing City Government claimed that the department store’s sales reached 17.7 billion yuan ($2.72 billion) in 2020 to rank first in the world.
State media said nearby gyms, movie theaters and other non-essential businesses are expected to close, while the city conducted mass testing of residents and employees there through Tuesday, May 3. The report did not mention stay-at-home orders, but discouraged people from going out.
Nearby, in an area one metro stop south of the main business hub, local authorities have extended the lockdown that began on Monday until next Tuesday May 3. Authorities also slightly widened the scope of the lockdown zone to the south.
The affected areas above are in Beijing’s main business district which began three days of mass testing on Monday.