China may not be making major changes to its Covid policy anytime soon

A couple pass necessities through a fence due to the Covid-19 lockdown in Guangzhou city on November 17, 2022.

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BEIJING — China is unlikely to make major changes to its Covid policy for the foreseeable future despite protests this weekend, analysts said.

They say that one of the reasons for the public unrest is local implementation of recent central government policy.

“Without clear guidance from their superiors, local officials tend to play it safe by sticking to the existing Covid-free stance,” said Larry Hu, chief China economist at Macquarie. “. “It upsets many people who expect[ed] more easing after the ’20 measures'” announced earlier this month.

Group of people in China took to the streets at the weekend to vent their frustrations, built up during nearly three years of strict Covid control. Local infections have increased, prompting more lockdowns to be implemented in the last week.

Although protests are rare, the scale of the demonstrations organized is unknown.

Earlier this month, the central government signaled a step towards reopening by announcing “20 measures” to cut quarantine time and generally make Covid control measures more targeted.

Economist says China's easing of Covid-19 prevention measures is 'key' to helping the country recover growth by 2023

However, Hu said it remains unclear whether the aim of the measures is to significantly reduce new infections – potentially necessitating a strict lockdown – or to slow the rate of growth, which causes less disruption to the economy. health and hospital.

“Next week could be crucial, as news of social unrest over the weekend increased the sense of urgency for further policy clarification and guidance from higher ups,” he said.

In Beijing over the weekend, unverified social media videos showed residents pointing out 20 measures and convincing their community management that there was no legal basis to lock down the apartment complex. their.

Implementation Vulnerability

On Saturday, a publication overseen by the Chinese Communist Party mouthpiece People’s Daily said that based on 20 measures, only county governments and above could call for Covid control and school closures. School or traffic should not take place arbitrarily.

Separately, People’s Daily posted a front-page commentary on Monday about the need to make Covid control measures more targeted and effective, while eliminating what should be eliminated.

Qin Gang, executive director of Beijing-based think tank ICR, said it could take a month for the 20 measures to be fully implemented, after which policymakers could implement those. next change.

Especially before the measures, “it is clear that we have over-controlled the virus,” Qin said in Mandarin, according to a translation by CNBC. “Because it’s excessive, it has brought many problems.”

He noted that accepting the continued control measures of Covid would no longer be sustainable for the Chinese economy and society.

Read more about China from CNBC Pro

China’s GDP barely grew in the second quarter, dragged down by the strict lockdown in Shanghai. As of the third quarter, full-year growth was just 3%, well below the official target of around 5.5% announced in March.

“In the short term, Covid policy will only be adjusted without shifting the needle,” said Bruce Pang, chief economist and head of Mainland China research at JLL. “The focus of the stories is expected to switch back and forth between eliminating cases and introducing more precise measures.”

“Authorities are sending signals of a more realistic attitude towards the economic roadmap, COVID policy and geopolitical relations, all of which will help bring about a rebound,” he said. gradually economic for China”.

Most cases have no symptoms


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