12/07/2024 2:34 PM

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Shanghai Urges Bankers to Work From Home, Rules Out Lockdown

Shanghai ruled out imposing a lockdown for now, while urging workers in its main financial and business district to work from home as officials try to rein in a swelling Covid-19 outbreak in one of China’s biggest and most important cities. 

Gu Honghui, deputy secretary general of the Shanghai government, told reporters Tuesday that “there’s no need to lock down the city” at the moment, with authorities keen to minimize the impact of virus mitigation efforts on businesses and people’s lives. Instead, the authority overseeing the Pudong district, home to China’s main stock exchange and the local headquarters of a bevy of financial firms, called for more flexible work arrangements in a statement on its official WeChat account. 

Battling its largest nationwide outbreak in two years, China locked down a city near Beijing Tuesday, following similar moves earlier this week in the southern tech hub of Shenzhen and the northeastern province of Jilin. That’s fueled concern the country’s financial gateway could be next, with virus cases in Shanghai continuing to rise and some buildings locked down.

China is stepping up tactics to quell the virus, continuing to deploy the Covid Zero playbook that has left it isolated from the rest of the world in a bid to bring cases back to near zero. While it has been able to avoid more stringent measures like lockdowns in bigger cities in the past, the more contagious omicron variant is challenging that approach like never before. More than 100 international flights will be diverted away from Shanghai from March 21, to ease pressure on quarantine hotels and isolation facilities. China isolates all virus cases, regardless of their severity, as a way of halting spread. 

Shanghai reported 202 new Covid infections on Tuesday, compared with two at the start the month, as China’s nationwide tally topped 5000 cases for the first time since the country’s original outbreak in Wuhan. 

Home to some 25 million people, Shanghai has shut most schools and public parks and blocked bus travel from other provinces. The city has also imposed movement restrictions at college campuses, requiring people to provide two negative nucleic acid test results within the past 48 hours to enter as well as mandating permission to leave the campuses, according to a report in the Beijing Daily.

China has imposed more lockdowns over the past week than at any point in the pandemic, with Shenzhen, Langfang City near Beijing, Changchun in the northeast and then its surrounding province, Jilin, all put under movement restrictions since the end of last week. Dongguan, a key manufacturing hub in the southern province of Guangdong, is also subject to some curbs, with factories in areas with virus cases told to close. 

While local authorities in Dongguan and Shenzhen say factories outside the highest risk districts can continue operating if they keep staff in a bubble with regular testing, some big companies have halted operations. IPhone maker Hon Hai Precision Industry Co., known as Foxconn, suspended production at its Shenzhen sites on Monday as authorities undertake multiple rounds of mass testing. In Jilin, where the capital Changchun is a key auto-making hub, Toyota Motor Corp. and Volkswagen AG have paused operations. 

 Banks including Nomura Holdings Inc., and Morgan Stanley say China’s resource-intensive approach to containing Covid — a strategy that has delivered one of the lowest death tolls globally, but is becoming increasingly difficult to deploy — damp the country’s growth outlook. There are also concerns they could be a drag on the world economy, which is facing a raft of challenges this year.  

China isn’t expected to ease up meaningfully on Covid Zero before 2023, given the need for stability in a politically important year for President Xi Jinping, people familiar with China’s thinking have told Bloomberg News. 

Still, there are signs the country is girding for an uptick in cases, with rules around quarantining changed late Tuesday. Covid patients who have been discharged now only have to isolate at home for seven days, down from a previous 14, according to a notice posted on the State Council’s website. One of the main reasons China is reluctant to ease border curbs and live with the virus like other countries is the state of its hospital system, which is hobbled by lopsided distribution of resources.

The country also approved the use of at-home rapid antigen tests kits at the end of last week, and has authorized Pfizer Inc.’s coronavirus pill, seen as evidence Beijing is at least thinking about what comes after Covid Zero.