Economic Watch: China sticks to zero COVID policy despite record infections (NASDAQ:AAPL)

China steps up measures to control COVID outbreaks

Kevin Frayer News/Getty Images

It’s been three years since the first case of COVID-19 was reported in Wuhan, but China doesn’t seem to budge on its strict coronavirus policies. In fact, quarantine facilities and makeshift hospitals are expanding all over the world. continent to deal with the largest wave of cases recorded. Panic buying is also taking place among supermarket delivery apps as lockdown-like restrictions are imposed in Beijing, while Nomura estimates that more than a fifth of the country is under some form of restricted movement.

Discontent grows: Apple (NASDAQ:AAPL) Supplier Foxconn’s (OTCPK:FXCOF) iPhone factory in the city of Zhengzhou has drawn a lot of attention when videos of worker unrest were shared on social media. Since then, Foxconn has offered a payment of 10,000 yuan, equivalent to $1,400, to workers who want to leave, as well as free transportation back home. It’s unclear how many of the 200,000 “iPhone City” employees were involved, but Apple (AAPL) has noted “fewer iPhone 14 Pro and iPhone 14 Pro Max shipments” due to previous restrictions at the complex, which includes dormitory accommodations and It is responsible for 70% of the world’s iPhone production.

“The real stumbling block for the economy lies in more enthusiastic implementation of COVID restrictions by local officials rather than insufficient loanable funds,” wrote Ting Lu, chief China economist at Nomura. Concerns are growing as infections rise in the manufacturing province of Guangdong and the megacity of Chongqing, as well as in the financial hub of Shanghai and the heavy logistics of Zhengzhou. At the end of the third quarter, China’s GDP rose just 3% year-on-year, well below the official target of around 5.5% announced in March.

Thought bubble: China’s central leaders have seen the zero-COVID policy as a source of national pride, which could show the superiority of their system, compared to the death and infection counts seen in many Western nations. There are also fears that any major outbreak could overwhelm China’s healthcare system (especially given the population’s low natural immunity), mobilizing public anger and undermining trust in the government. Earlier this month, officials said they would be more specific and specific in implementing pandemic controls, but there would be no fundamental changes to the overall zero-COVID stance.

ETFs: NYSEARCA:FXI, NYSEARCA:KWEB, NYSEARCA:CQQQ, NASDAQ:MCHI, NYSEARCA:ASHR, NYSEARCA:YINN, New York Stock Exchange: TDF, NYSEARCA:CHIQ, NYSEARCA:GXC, NYSEARCA:EWH, NYSEARCA:KBA, NYSEARCA:YANG, NASDAQ:CXSE, NYSE:CAF, NYSEARCA:CWEB, NASDAQ:PGJ, NYSEARCA:KURE, NYSEARCA:CHIX, NYSEARCA:CYB

Leave a Reply

Your email address will not be published. Required fields are marked *