And if the war in Ukraine was not the greatest threat to the world economy † Thousands of kilometers from Kiev, Mariupol or Lviv, the fate of the world’s fairs is played Shanghai† The nerve center of China will be placed in strict confinement to comply with policy “Zero Covid” of the Asian giant. One strategy is to isolate an entire sector, which can vary from a district to an entire region, as soon as the least coronavirus† The idea? Preventive containment gives the epidemic no time to get carried away and keeps the number of cases under control.
A policy that Shanghai images as alarming as they are absurd in terms of dehumanization : Infants torn from their positive mother, positive-case detention centers overcrowded, portions of food reduced to a trickle. There is also a city, a major economic player on the planet, standing still, and growth forecasts increasingly half-mast. Beijing on Monday set itself a target of “just” 4.8% for this first quarter, far from its forecast of 5.5% for all of 2022, already the worst figure since the early 1990s, excluding the year 2020.
In an article with a more than suggestive title – The biggest risk to the global economy that no one is talking about –, CNN quantifies the problem: “Nearly 400 million people, in 45 cities in China, are wholly or partially restricted as part of China’s strict “Zero Covid” policy. Together they account for 40% of the annual gross domestic product (GDP) of the world’s second largest economy, according to data from Nomura Holdings.
Stay on track, against all odds
Jean-Vincent Brisset, research director of the Institute of International and Strategic Relations (IRIS) and specialist in China, contacted by 20 Minutes, joins the American journalists: “The economy is like cycling: at the end of a certain threshold, when you stop pedaling, you fall. China needs high growth, at least 6%.” A sentiment confirmed by Valérie Niquet, senior researcher and head of the Asia division at the Foundation for Strategic Research (FRS): “China has major social needs that require rapid growth and a well-functioning economy”.
But with these mass incarcerations at the slightest outbreak of the epidemic, “Zero Covid” is putting the economy to a standstill rather than on the highway of the growth† Antoine Bondaz, also a researcher at the FRS and a specialist in China, qualifies: “For the time being, the annual growth rate is maintained at 5.5. We will see the impact of the curtailment of Shanghai in Q2. “He recalls that, unlike France, China’s containment, however severe it may be, is extremely local and not extended to the whole country: “So the economy can continue to run elsewhere. The districts of Shanghai that have not had any new cases for two weeks are beginning to deconsolidate to restart certain factories.”
Nevertheless, with Omicron and its sublines, much more contagious than the previous variants or the original species, raises questions of Chinese politics. Faced with this accelerated transfer, many countries have given up “Zero Covid”. Beijing resists.
The Impossible Reverse
Valérie Niquet: “Power has long touted its “Zero Covid” strategy, as opposed to a more lax West. The balance per million inhabitants is very low compared to the United States or Europe. This policy has become a national pride and it is hard to go back. ” In any case, going back is a concept that is quite unknown to the Chinese government, Jean-Vincent Brisset recalls: ” China is not France, where Olivier Veran can say anything and the opposite in eight days. If Xi Jinping changes his strategy, that means he was wrong, which would end badly. †
Apart from this determination inherent in a dictatorship, can China really let the epidemic circulate as it does in Europe? Not really, according to Valérie Niquet. Still out of nationalistic pride, Beijing refused western RNA vaccines in favor of serums made in China much less efficient. The country gave priority to vaccination, not to the elderly, as was the case in the West, but to workers, who gave only partial vaccination coverage to the most vulnerable elderly.
“China has quite a few hospitals and could not handle an explosion of cases. By letting the coronavirus slip away, tens or hundreds of thousands of Chinese may die without being able to care for them, which would also be a task for the regime,” the expert supports.
What consequences?
According to Antoine Bondaz, everything will probably be played out in the coming weeks: “In Shanghai, things are starting to slow down. If the epidemic does not affect several major economic regions simultaneously and remains locally limited, the strategy will remain profitable and viable. Yes, China will not have incredible growth, but it will recover. “On the other hand, if Omicron escapes completely and hits the country nationwide, or if the economic results are too low,” Xi Jinping could be threatened, says Valérie Niquet. The Communist Party Congress is in October and policies against the coronavirus will be closely examined. †
In the event of a major downturn, the consequences will be global, as the one with the most to lose may not be the country itself. Jean-Vincent Brisset comments: “We see it with Russia: the resilience of a non-Western country is much more important than we think. If China slows down, the rest of the world will especially suffer. I often illustrate our dependence on my students by asking them to take everything from China off their table. They still have a Bic, and more. †
