While China fights the coronavirus, some say it has gone too far
A vicious viral outbreak has changed that formula. China’s typically supercharged economy has stagnated almost completely when authorities fight a coronavirus that has killed more than 2,000 people and has made tens of thousands more sick. Hundreds of millions of people now live essentially isolated, as roadblocks seal entire villages and local authorities prevent the reopening of businesses.
Coronavirus outbreak: live updates
Business leaders and economists in China increasingly say more, enough. While China must stop the outbreak, they argue, some of its methods are damaging the lives and livelihoods of millions of people while contributing little to the containment effort.
“Get a balance that leads to life protection,” wrote James Liang, chief executive of Trip.com, China’s dominant online travel agency, in an essay widely released this week.
Liang warned that if the country becomes impoverished due to emergency health measures, that could harm public health more than the virus itself.
No one questions that the disease remains a serious problem, particularly in Hubei Province and its capital, Wuhan. More than 70,000 people have been affected, according to official figures. Foreign medical experts have suggested that the true total may be much higher.
However, business leaders and economists begin to wonder if mandatory 14-day quarantines, roadblocks and checkpoints are required in much of the country, especially in remote provinces of Hubei, where there have been very few cases.
The debate is unusual in a country where dissent is generally censored or silenced. Even issues such as business and the economy, which were once considered a relatively fair discussion game, have become sensitive as China’s economy has slowed and the Communist Party has strengthened its control over more aspects of Chinese life. .
Even so, even the Chinese government has recognized the wounds inflicted on the country’s economy, further fueling the national discussion about when it might be enough.
“If the epidemic lasts a long time, agricultural products, food and industries with long industrial chains and labor-intensive industries are expected to be greatly affected,” said Li Xingqian, director of foreign investments at the Ministry of Commerce, in a Press conference in Beijing on Thursday.
The waves are spreading far beyond China, affecting companies such as Apple, General Motors and Adidas. Amazon, the e-commerce giant, is taking steps to keep its virtual shelves stocked.
Beijing is hitting a difficult balancing act. He urges officials across the country to continue fighting what Xi Jinping, the country’s leading leader, has called “the people’s war.” At the same time, he has urged workers and farmers to return to work and has taken steps to help businesses. On Thursday, it reduced loan rates to give companies more access to money.
Many of China’s companies, particularly small ones, seem to be in trouble. A third of small businesses in the country are about to run out of cash in the next four weeks, according to a survey of 1,000 business owners conducted by Peking University and Tsinghua University. Another third will run out of cash in the next two months.
Beijing options are risky. New data on Thursday showed that the number of newly confirmed infections had been drastically reduced. However, much of that fall seemed to reflect a narrowing in the definition of confirmed infection.
Chinese health officials insist that it is too early simply to dismantle the many measures they have imposed.
“We actively support the orderly resumption of work and production, but we still cannot relax our vigilance in the least,” said Zheng Jin, spokesman for the Shanghai Municipal Health Commission, at a press conference on Thursday.
However, signs of progress combined with growing concerns about the economy have stimulated calls for Beijing to relax.
A team of Chinese economists, mainly at the University of Beijing and the Huachuang Securities brokerage, wrote a widespread online analysis last week that critically analyzed the containment effort. They argued that too many areas of China with few cases of coronaviruses were trying so hard to stop the virus that prevented normal trade between cities.
“If all regions depend on the blockade, they can block viruses, but they can also block the economy,” economists wrote in an essay that first appeared in Caixin, one of China’s most respected publications. “At that time, a wave of corporate closures and unemployment may occur, worse than the current epidemic.”
No company or city can resume regular activity by itself, because every company and community needs materials and workers from other places, wrote Lu Zhengwei, chief economist at the Industrial Bank in Fujian Province, in an online publication this week. “It is necessary to restore normal urban life” for the economy to recover, he added.
However, if Beijing moves back too quickly, it could allow a large number of workers to gather in their factories and offices in a way that revitalizes the spread of the coronavirus, something that neither business leaders nor the government want to see.
E-commerce China Dangdang, an online retailer based in Beijing, met that nightmare this week. One of the company’s employees had a fever on Tuesday, and on Wednesday night, the Chinese Center for Disease Control and Prevention had diagnosed the coronavirus as the cause.
The company said it had ordered all employees to work from home. Employees who sat near the infected worker were quarantined in their homes.
Working from home can be an option for companies like Dangdang, but manufacturers don’t have that luxury. Many factories continue to operate at a small fraction of capacity, even when companies around the world observe that their inventories of products and components manufactured in China decrease.
Incremental movements are beginning to be made to compensate for the effects of strict restrictions imposed on the movement of people and goods.
Cities are beginning to organize special trains to take migrant workers from the cities they visited during the recent Lunar New Year vacations. Hangzhou City announced that it had organized a high-speed train to bring more than 600 workers from the central province of Henan and another high-speed train to bring 750 workers from the western province of Sichuan.
Concerned about the loss of jobs, some officials are paying companies to hire them. Xi’an, a city in northwestern China, announced that it was offering a one-time subsidy of $ 285 for each worker hired by companies that manufacture medical protective equipment, and up to $ 430 per worker for companies in any industry that you hire large quantities.
Chinese officials are also attentive to grocery bills. Even before the coronavirus hit, food prices rose more than 15% annually in China last fall. A different epidemic, African swine fever, had quickly killed half of the country’s pigs, its main source of protein.
Now the coronavirus threatens to send even higher food prices. The Ministry of Agriculture ordered villages across the country to eliminate roadblocks and checkpoints and allow the movement of food for animals and livestock. But there have already been reports of mass slaughter of poultry for lack of food, and chicken prices have plummeted temporarily, in a possible sign of panic sales.
“The overall impact of production stops in agriculture across the country,” Lu wrote of the Industrial Bank this week, “cannot be underestimated.”