The city of Guangzhou, in the southern province of Guangdong, is the most affected by the latest Covid outbreak. Shown here are stores closed in part of the city on October 1. 31, 2022.
vcg | China Visual Group | fake images
BEIJING — Covid infections are surging in the capital of China’s major export country Guangdong province, raising concerns about another drag on the national economy.
Schools in eight of Guangzhou city’s 11 districts switched classes online for most students from Thursday. In recent days, more parts of the city have ordered people to stay home and close non-essential businesses.
“As things stand, it’s hard to tell whether Guangzhou will repeat the Shanghai experience in the spring of this year,” Nomura’s chief China economist Ting Lu and a team said in a note Wednesday night. “If Guangzhou repeats what Shanghai did in the spring, it will lead to a new round of pessimism about China.”
Earlier this year, the metropolis of Shanghai went into lockdown for around two months and broader Covid checks resulted in a second-quarter national GDP that grew by just 0.4%, according to official figures. GDP recovered in the third quarter with growth of 3.9%but then exports fell unexpectedly in October.
It was not immediately clear to what extent Guangzhou’s latest trade restrictions affected factories’ ability to operate. Many manufacturers are located outside the city but in the same province.
State-owned automaker GAC Group said its manufacturers in Guangzhou were operating normally as of Thursday morning. “The epidemic has not caused a substantial impact,” the company said in a statement.
In just one week, the number of COVID infections with symptoms in Guangdong has increased fivefold to 500 on Wednesday. During that time, infections without symptoms increased sevenfold to about 2,500 cases.
The latest outbreak prompted the American Chamber of Commerce in China to postpone an event in Guangzhou, already delayed from September, Michael Hart, the chamber’s president, said Thursday. He expects two more chamber events in the city to be postponed this year.
“These travel impacts are affecting the ability of local governments to seek investment,” Hart said, noting that such investments were not lost but delayed.
“I have canceled more trips than I have actually been able to do,” he said.
Late fall is a popular time for conferences and business travel in China.
In particular, Guangzhou has indefinitely delayed its car show that was scheduled to start next week. The country’s biggest auto show that Beijing was supposed to host earlier this year was never rescheduled.
More travel restrictions
“Probably a bigger concern [than getting sick] is what it does [travel] do with your Beijing health code and can you come back?” Hart said, referring to a government smartphone app for tracking Covid exposure.
The city requires anyone entering a mall, taxi or public space to use the app. The venue may deny entry if the app shows that the person has not had a negative covid test result in the past three days, or displays a “pop-up” that is supposed to indicate a suspected contact with a covid infection.
The pop-up prevents people from entering Beijing.
His appearance has become so frequent and somewhat unpredictable that a Chinese commentator said in a widely shared video that every business trip outside of Beijing was a choice between family and work. The video was removed from public view Thursday morning.
The Beijing health code enforcement pop-up also affects people’s mobility within the capital city, which has reported a growing number of infections in recent days.
“In Beijing, you just assume that a certain percentage of the workforce will have problems with pop-ups,” Hart said, noting that virus-testing requirements for some office buildings have increased to once every 24 hours. “Instead of loosening up, it’s getting tighter in some areas.”
