China’s COVID epicenter moves to Guangzhou as outbreaks widen

China's COVID epicenter moves to Guangzhou as outbreaks widen
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  • Southern manufacturing hub battles worst COVID-19 outbreak
  • Cases double in Zhengzhou, production base for Apple supplier
  • Chinese stocks, currencies fall on virus fears

BEIJING, Nov 8 (Reuters) – New coronavirus cases surged in Guangzhou and other Chinese cities, official data showed on Tuesday, with the global manufacturing hub becoming China’s latest epicenter of COVID-19 and testing capacity of the city to avoid a Shanghai-style lockdown.

Nationwide, new locally transmitted infections totaled 7,475 on November 1. 7, according to China’s health authority, down from 5,496 a day earlier and the highest since May 1. Guangzhou accounted for almost a third of the new infections.

The increase was modest by global standards, but significant for China, where outbreaks will be dealt with quickly when they arise under its zero-COVID policy. Economically vital cities, including the capital Beijing, are requiring more PCR tests for residents and are closing neighborhoods and even districts in some cases.

The sharp rebound will test China’s ability to maintain its surgical and targeted COVID measures, and could dampen investors’ hopes that the world’s second-largest economy can ease curbs and restrictions soon.

“We are seeing a game between rising voices to relax controls and the rapid spread of COVID cases,” said Nie Wen, an economist at the Shanghai-based Hwabao Trust.

Considering how nationwide COVID restrictions are crushing domestic consumption, Nie said he had lowered his fourth-quarter economic growth forecast to around 3.5% from 4% to 4.5%. The economy grew 3.9% in July-September.

The rising number of cases dragged down China’s stock markets on Tuesday, but stocks have yet to recapture last week’s big gains.

Investors see China’s battered markets as an attractive prospect as a global slowdown looms, and have focused on small clues of gradual change, such as more targeted lockdowns and progress on vaccination rates.

“No matter how harsh the letter of the law is … there is a little bit more relaxation,” said Damien Boey, chief macro strategist at Australian investment bank Barrenjoey.


Guangzhou, capital of Guangdong province, reported 2,377 new local cases on November 1. 7, compared to 1,971 the day before. It was a dramatic jump from double-digit increases two weeks ago.

Rising case numbers in the sprawling southern city, dubbed the “world’s manufacturing plant,” mean Guangzhou has overtaken the northern Inner Mongolia city of Hohhot to become China’s COVID epicenter. , in its most serious outbreak to date.

Many of Guangzhou’s districts, including downtown Haizhu, have imposed varying levels of restrictions and closures. But so far, the city has not imposed a general lockdown like the one in Shanghai earlier this year.

Shanghai, currently not facing a resurgence of COVID, went into lockdown in April and May after reporting several thousand new infections daily in the last week of March.

“We have been working from home for the past few days,” said Aaron Xu, who runs a company in Guangzhou.

“Only a few precincts have been closed so far. For the most part, we’re seeing disruptions in the form of public transport services being suspended and precinct security blocking couriers and food deliveries. And we need to test of CRP every day”.


In Beijing, authorities detected 64 new local infections, a small uptick relative to Guangzhou and Zhengzhou, but enough to prompt a new wave of PCR tests for many of its residents and the closure of more buildings and neighborhoods.

“The lockdown situation has continued to deteriorate rapidly across the country over the past week, with our internal China COVID lockdown index rising to 12.2% of total China GDP from 9.5% last Monday,” Nomura wrote in a note on Monday.

Zhengzhou, capital of central Henan province and a major production base for Apple (AAPL.O) supplier foxconn (2317.TW), reported 733 new local cases for November 1. 7, more than double that of the previous day.

In the southwestern metropolis of Chongqing, the city reported 281 new local cases, also more than double the 120 a day earlier.

In the coal-producing region of Inner Mongolia, the city of Hohhot reported 1,760 new local cases on November 1. 7, compared to 1,013 the day before.

Reporting by Ryan Woo, Bernard Orr, Liz Lee, and Jing Wang; Additional reporting by Josh Ye in Hong Kong and Tom Westbrook in Singapore; Edited by Raju Gopalakrishnan, Stephen Coates, and Raissa Kasolowsky

Our standards: The Thomson Reuters Trust Principles.

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