- “The Market may celebrate Beijing’s decision to abandon ‘zero Covid.’” – The Wall Street Journal (Dec 10, 2022)
- “China is under-reporting coronavirus cases and fatalities, obscuring the scale and severity of the health crisis.” – Financial Times (Dec 10, 2022)
- “Oil prices settled lower as investors assessed the effects of rising Covid-19 cases in China.” – Barron’s (Dec 28, 2022)
- “Chinese manufacturing and service-sector activity fell to their lowest levels since the initial throes of the coronavirus pandemic in early 2020, highlighting the breadth of the tumult as waves of infections roar through the world’s second-largest economy following Beijing’s abrupt decision to scrap its draconian ‘zero-Covid” measures.’” – The Wall Street Journal (Dec 30, 2022)
China’s abrupt and apparently preparation-free exit from Zero-Covid (the extreme policy it had pursued for almost three years) is already shaping up as a public health fiasco. It also now poses the biggest emergent risk to the global economy as we enter the New Year.
The economic risk arises out of the fundamental medical and epidemiological risk associated with the Zero-Covid Exit. In all countries the pandemic has drained resources away from “normal” economic activities into emergency healthcare, mass testing programs, quarantines and lockdowns. It has disrupted supply chains and suppressed consumption, and imposed extraordinary costs upon the public. Now it is coming to China, openly and officially. The important question from this perspective is: How severe will the euphemistically entitled “exit wave” of Covid infections in China turn out to be? How will it impact the Chinese economy?
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