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The Chinese dilemma: stop the virus or revive the economy

2020-02-19T22:47:56.330Z


Measures against the epidemic prevent the return to work of more than 220 million people and prevent the normal functioning of companies


The official X - has not transcended his name - works in the City of Beijing, where he lives. He spent the lunar New Year in his village in the nearby province of Hebei. There he celebrated with his family, toasted, played cards and visited relatives. As it was an essential part of the epidemic response device, it was one of the first municipal employees of the capital to return to work. A few days later, he received the news: one of his relatives in the town had Covid-19. The tests were done: although without symptoms, he himself was a carrier of the new coronavirus. Now, 69 other officials in contact with Mr. X have had to quarantine, as revealed by the City Council on Tuesday.

As Chinese companies incorporate personnel to their jobs to try to restore normalcy, they find that there is a delicate balance between the need to relaunch economic activity - an increasingly insistent message from the official media - and to avoid the spread of the epidemic, the "people's war" that the Chinese president, Xi Jinping, underlines that we must win at all costs.

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The Chinese media have published several cases in which, after returning to work, an employee has been ill and has had to suspend operations again, from a titanium plant in Chongqing to a supermarket in Shenzhen. At the same time, companies adopt with almost religious zeal more and more stringent measures to allow their employees to enter the premises: daily notification of their health status, checking the temperature once, twice, several times.

The figures published by the National Health Commission point to a cautious optimism about the evolution of the epidemic, which has killed more than 2,000 people and infected more than 74,000. For the first time, on Tuesday the new cases dropped from two thousand. The infections outside the province of Hubei, the focus of the disease, have been less every day for two weeks. The reference epidemiologist of the Chinese Government, Zhong Nanshan, expects that the peak can arrive, in the south of the country, already at the end of this month.

But after the long break for the lunar New Year and more or less strict quarantine measures in numerous areas of the country, on February 15, only 80 million had returned to their usual residences and jobs, less than a third of the 300 million who had left. The Chinese authorities estimate that another thirty million will return before the end of the month, and the rest will return throughout March. Government scientists warn of the possibility of a spike in contagion during that process.

In part to avoid this, many local authorities have imposed or hardened the mobility limitations of its residents, while companies encourage those who can work from home. In Beijing, those who arrive from abroad will have to complete a fourteen-day quarantine and notify their neighborhood community and their employer. Many housing complexes, and even entire streets, have closed access to non-residents.

A calculation from The New York Times finds that, among the 1.4 billion inhabitants of China, at least 750 million suffer some kind of restriction on their freedom of movement. Of these, 150 million have limited the frequency with which they can leave their home.

Work from home, and the instructions to leave home as little as possible, coupled with distrust of possible contagion, have drastically changed living habits, especially in large and medium-sized cities, where to order food at home instead of cooking It was an upward trend: more than 250 million people placed more than 400 million orders a week. Now, there are hardly any restaurants open.

“For the first time in my life, I am learning to cook. I have no other ”, laughs Jin, public relations of 27 years. There are things that do not change: instead of going to the store herself, the young woman, like many other millions of people, orders the ingredients from her menu to the same companies that used to bring her restaurant order. The JD.com e-commerce platform, the second in the country, has tripled from the New Year its sales of fresh food, up to 150,000 tons, according to the Xinhua news agency.

It is one of the few companies that are doing well. The Japanese bank Nomura has lowered its growth expectations of the Chinese economy from 3.5% to 3% for this quarter. A survey of the Peking and Tsinghua Universities finds that only 34% of SMEs believe they can endure another month with the current cash level. Concerned about the possibility of an increase in unemployment - a serious threat to social stability - the Chinese government has announced several relief measures for small businesses, including a cut in Social Security contributions. Some cities on the coast take measures to accelerate the reinstatement of workers.

The services sector, which represents 54% of Chinese GDP, expects a lousy quarter. As of February 13, 78,000 flights had been canceled and the companies had returned the amount of 13,000 airline tickets. A state-owned tourism company has closed 19 hotels. Long-distance buses operate only at 50% occupancy.

Taiwanese tech giant Foxconn, which employs 400,000 people in mainland China, does not get enough workers to operate its plants at full capacity. Only 80% of the 20,000 state companies under the control of the Asset Supervision Administration have managed to resume the activity. According to the Global Times newspaper, even the armament sector tries to recover lost time against the clock, to test fighter jets and put the final touches on an "important" ship.

The economic activity, according to Bloomberg Economics Report, was still at 40 or 50% capacity last week. Electricity consumption was still at half the levels of the same dates last year. According to a report by the US Chamber of Commerce in China, 78% of the 109 companies consulted still lacked enough employees to be able to return to normal.

In an editorial, the Global Times recognized the weakness of economic activity. His formula: that from the Government insist on reaching a goal of 6% growth for this year, the same as anticipated before the crisis. "A precise growth goal will make it clear how important the task of relaunching the economy is and inject a greater sense of urgency at different levels of government and business," he said.

Source: elparis

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