Beijing’s Abrupt Dismantling of Zero-Covid Controls Has Been Welcomed by Economists

Beijing’s abrupt dismantling of zero-Covid controls has been welcomed by economists, even as the country braces itself for the human impact of letting the disease spread through a vulnerable population.

The leadership’s abrupt U-turn on how it handles the pandemic appears to have been triggered by protests against controls that began last month, a nationwide show of discontent on a scale China had not seen in decades.

But that unrest came after growing concern about the toll that isolation and regular harsh lockdowns were having on the country’s economy.

China has been an engine for regional growth since last century. However this year it is forecast to lag behind its neighbours for the first time since 1990, with disastrous implications for its people.

Nearly one in five young people in cities are unemployed. Small and medium businesses have been particularly badly hit by the uncertainty, and the impact of unpredictable and often long-lasting shutdowns of entire cities.

But almost no one has been exempt. The founder of Foxconn, a key Apple supplier, had warned Beijing that controls threatened China’s place in the global supply chain, the Wall Street Journal reported.

The private letter was sent last month, when disgruntled workers protested at the company’s factories, and was ammunition for health officials and advisers who wanted to open the country to the world again.

Other countries which had pursued zero-Covid policies at the start of the pandemic, from Australia to South Korea, have cautiously opened up again since vaccines and anti-viral treatments became more widely available.

The IMF’s managing director, Kristalina Georgieva, welcomed the “decisive” steps by Chinese authorities in “recalibrating Covid policies”, and said they could boost the regional international economy.

“This can be very good for the Chinese people and economy, and also good for Asia and the world economy,” she said after a summit in China’s eastern Huangshan city. Premier Li Keqiang, who hosted the discussions, had conspicuously abandoned masks and social distancing.