Shanghai achieves prized ‘COVID-free’ status but lockdown persists

  • Shanghai goes three days without new community infections
  • Only a few signs of a gradual reopening
  • Amcham warns that COVID controls are hampering foreign investment

SHANGHAI/BEIJING, May 17 (Reuters) – Shanghai passed the long-awaited milestone of three straight days with no new COVID-19 cases outside quarantine zones on Tuesday, but most residents will have to endure the lockdown for some time before to resume normal life.

For other cities in China that have been in lockdown, three days with no new community cases usually means zero COVID status and the start of lifting restrictions.

The mall of 25 million people on Monday laid out its clearest timetable yet for emerging from a lockdown now in its seventh week, but the plan was met with skepticism by many residents who have seen isolation repeatedly extended.

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“Normality is a long way off,” said a Shanghai resident still stuck at home.

Shanghai plans to resume outdoor activities in stages, with some stores reopening this week but most movement restrictions remaining in place until May 21, after which public transport and other services will gradually resume.

By June, the lockdown is expected to be lifted, but residents will still be asked to get tested frequently.

More people have been allowed out of their homes this week, with joggers and dog walkers spotted. A man was seen fishing in a creek in Shanghai.

But high fences remained around many residential compounds and there were almost no private cars on the streets, with most people still confined to their homes.

It’s unclear how many stores have reopened this week, but in a positive sign delivery apps showed more options for people to order from Tuesday.

A social media account run by the ruling Communist Party’s official newspaper, the People’s Daily, posted photographs on Monday evening that it said showed the opening of breakfast shops, restaurants and hairdressers.

But one social media user called the post “nonsense”.

“We were locked up at home for two months… This story is for anyone but the people of Shanghai.”

By Tuesday morning, the post had been deleted.

Video posted by another state-backed outlet announced the reopening of a grocery store, showing around 10 staff in hazmat suits making heart shapes with their hands, but only two people who looked like shoppers .

A sign on the store’s door says customers must present a negative COVID test and a pass that says they are allowed to leave their homes, among other requirements.

Overall, Shanghai reported less than 1,000 new cases for May 16, all in areas under the strictest controls.

INVESTMENT WARNING

China’s uncompromising ‘zero-COVID’ policy has placed hundreds of millions of consumers and workers under various restrictions at a time when the rest of the world is pushing them to ‘live with the virus’ even as infections spread .

Data this week showed the havoc wreaked on the economy by Shanghai’s lockdown and restrictions in dozens of other major cities, with retail sales and industrial production plunging at their fastest pace in more than two years in April. Read more

The capital Beijing saw a 16% plunge in retail sales in April, the start of its current outbreak, according to Reuters calculations based on January-April data released on Tuesday. Real estate sales fell 26%. Read more

The US Chamber of Commerce has warned that COVID controls will hamper foreign investment in China for years to come as travel restrictions disrupt due diligence on projects. Big companies are also exploring alternatives for supply chains, he said. Read more

China’s slowing economy will struggle to stage the kind of stunning recovery it has achieved since the first depths of the pandemic two years ago, analysts and policy insiders say. Read more

But China’s state planner said on Tuesday it would step up support for manufacturers, the service sector and small businesses to mitigate the impact of COVID.

A meeting called by China’s top policy advisory body with tech executives was also closely watched for any signs of easing in the sector’s regulatory crackdown that has weighed on growth. Read more

Chinese stocks (.CSI300), (.SSEC) closed higher on bets for softer regulatory scrutiny on the tech sector and Shanghai’s progress on COVID.

TIGHTENING IN BEIJING

The latest daily case count in Beijing was 52, with authorities discovering a few dozen new infections almost daily despite the gradual tightening of restrictions over the past three weeks or so.

Catering services are banned in the capital, some shopping centers and other businesses are closed, public transport is reduced and many residents have been asked to work from home.

Residents of parts of Beijing’s Fengtai district affected by COVID have been ordered not to leave their neighborhoods, state television reported on Tuesday.

In Beijing’s largest district, Chaoyang, some compounds have closed side exits while main gates are manned by volunteers checking health credentials on the mobile app authorities use to track COVID.

Security personnel patrolled the banks of the Liangma Canal, which in recent weeks has become a picnic spot for locals barred from going elsewhere. Signs had been put up asking people to “avoid crowds, gatherings and eat together”.

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Reporting by David Stanway, Brenda Goh and Winni Zhou in Shanghai; Martin Quin Pollard and Ellen Zhang in Beijing; and offices in Beijing and Shanghai; Written by Marius Zaharia and John Geddie; Editing by Robert Birsel

Our standards: The Thomson Reuters Trust Principles.

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