China prepares to further ease COVID restrictions as markets applaud turnaround

China prepares to further ease COVID restrictions as markets applaud turnaround
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  • New nationwide COVID rules for Wednesday: sources
  • Shift follows widespread demonstrations last month
  • Yuan firms, global markets rally on China hopes

HONG KONG/BEIJING, Dec 5 (Reuters) – China will announce a further relaxation of some of the world’s toughest COVID restrictions on Wednesday. sources saidas investors cheer the prospect of a policy change following widespread protests and mounting economic damage.

Three years into the pandemic, China’s zero-tolerance measures, from border closures to frequent lockdowns, stand in stark contrast to the rest of the world, which has largely chosen to live with the virus.

The strict approach has battered the world’s second-largest economy, strained the minds of hundreds of millions and last month sparked the biggest outpouring of public discontent in mainland China since President Xi Jinping took power in 2012.

Although last month’s protests largely subsided amid a heavy police presence in major cities, regional authorities have since eased lockdowns, quarantine rules and testing requirements to varying degrees. Senior officials have also softened their tone on the dangers posed by the virus.

Shanghai’s financial center announced late Monday that it would waive COVID testing requirements for people to enter most public places starting Tuesday.

And a new set of rules will be announced nationwide soon, two sources with knowledge of the matter told Reuters, paving the way for more coordinated relaxation.

Beijing is also considering whether to scale back its management of the virus to reflect the less severe threat it has posed since January, the sources added.

More broadly, analysts are now predicting that China may remove border controls and reopen the economy sooner than expected next year, with some seeing it fully open by spring.

“While we are also hopeful, we caution that the road to reopening may be gradual, painful and bumpy,” Nomura’s chief China economist Ting Lu wrote in a research note on Monday, adding that China did not seem Be well prepared for a massive crisis. wave of infections

As infections rise, putting pressure on China’s medical infrastructure, mild and asymptomatic cases should be quarantined at home, Feng Zijian, former deputy director of the China Center for Disease Control and Prevention, told The Paper. Diseases.

Those who have not completed their basic immunization or gotten their booster shots should do so as soon as possible, especially the elderly and vulnerable, Feng said in an interview with the Shanghai government-backed media outlet.

But last week’s ragged loosening has left some in China scared of being caught on the wrong end of rapidly changing rules.

Yin, who lives in a small town near Beijing, said her in-laws had come down with a fever and she had a sore throat, but they did not want to be tested for fear of being quarantined by the government.

“All we want is to recover at home,” he told Reuters, speaking on condition of anonymity.

The yuan jumped to its strongest level against the dollar since mid-September amid a broad market rally as investors expect the removal of pandemic restrictions to improve global growth prospects.

In another hopeful sign, a source at Apple supplier Foxconn (2317.TW) told Reuters the company expected its COVID-hit Zhengzhou plant, the world’s largest iPhone factory, to resume full production this month or early next month.

Economic data underscored the damage caused by the restrictions, as service activity contracted to a six-month low in November.


Along with easing in different cities, Vice Premier Sun Chunlan, who oversees China’s COVID efforts, said last week that the virus’s ability to cause disease was weakening.

That change in messaging aligns with the position held by many health officials around the world for more than a year.

In recent days, major cities in China have continued to ease measures.

Among them, the eastern city of Nanjing eliminated the need for a COVID test to use public transport. So did Beijing, although entry to many offices in the capital still requires negative tests.

“I still can’t feel a very noticeable change,” said Randle Li, 25, a marketing professional in Beijing. Li said his company still required him to take the test every day to enter the office.

Elsewhere, as testing requirements have been relaxed, official figures for new infections have also fallen.

Hu Xijin, a prominent commentator and former editor-in-chief of the state-run tabloid Global Times, said in a blog post that some official counts likely underreported the spread of the virus due to lower testing rates.

While the protests have subsided, frustration can still boil over, as events in the central city of Wuhan, where the virus first emerged in late 2019, demonstrated this weekend.

On Saturday, people broke down barriers in an apparent attempt to escape a lockdown at a garment industrial park, videos posted on Twitter showed.

Then, on Sunday, dozens of students stood in the rain outside a university in the city demanding more “transparency” in COVID policies, other videos showed.

Reuters was able to verify that the incidents occurred in Wuhan.

Reporting by Ryan Woo, Bernard Orr and Martin Quin Pollard in Beijing and Julie Zhu and Kevin Huang in Hong Kong; Written by John Geddie and Greg Torode; Edited by Clarence Fernandez and Nick Macfie

Our standards: The Thomson Reuters Trust Principles.

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