While New Zealand Retires Zero COVID, China Doubles Down

Not Even A Crumbling Economy Is Enough To Change Xi's Stance On Zero COVID

New Zealand is formally retiring the remainder of their “Zero COVID” mandates and restrictions, leaving in place only the isolation requirement for people who test positive for the virus.

With the abolishment of the traffic light COVID protection framework, mask mandates will be lifted in all areas except in healthcare and aged care settings.

Household contacts will no longer need to isolate, while people tested positive to COVID-19 will continue to be required to isolate for seven days.

All government vaccine mandates will end on Sept. 26, and all vaccination requirements for incoming travellers and aircrew will also be removed.

New Zealand Prime Minister Jacinda Adern said it was time to “turn the page” and retire the mandates.

This latest COVID policy shift largely completes New Zealand’s move away from Zero COVID protocols began last October.

Meanwhile, China’s state-run media continues to argue that Beijing’s Zero COVID strategy is both economically and scientifically sound.

While other “Zero COVID” governments abandon the failed policy and seek rapprochement with the SARS-CoV-2 virus, Beijing still has thoughts of eradicating it.

I wonder what the Hanzi script is for “virus is going to virus”?

Zero COVID A “Success” For China?

According to the China Internet Information Center, “dynamic Zero COVID” works.

China's dynamic zero-COVID strategy remains the most economical and scientific approach to tackling the disease as the pandemic continues to spread across the globe and bring fresh risks, a senior health official said on Wednesday.

Chang Jile, deputy director of the National Administration of Disease Prevention and Control, said that the dynamic zero-COVID approach aims to promptly detect new infections and rein in the spread at the lowest cost and within the shortest possible time.

"The strategy guarantees normal production and the safety of people across the country, and also ensures stable supply chains," he said during a news conference held by the Publicity Department of the Central Committee of the Communist Party of China.

However, not all Chinese agree with that assessment. Analysts with the China Real Estate Information Corporation (CRIC) last month released a report claiming the Zero COVID policies were responsible for surging vacancy rates at Shanghai shopping malls.

Authorities in Shanghai have denied a report by a leading Chinese real estate research firm that claimed more than a third of shops in a major mall had been shuttered because of strict Covid curbs.

The report by China Real Estate Information Corp. (CRIC), published late last month, quickly went viral. It claimed that vacancy rates in the city's malls were surging to an alarming level because of the restrictions and said 34% of shops were closed in a landmark mall in Shanghai's Lujiazui financial district.

The official response was that the CRIC methodology was nonstandard and that the report was basically wrong.

However, the CRIC report was only the latest analysis questioning the viability and necessity of the Zero COVID policy. Huatai Securities, a Nanjing-based investment firm, last week published a report claiming that COVID-19 produced fewer deaths than the flu in several of China’s neighbors such as South Korea, Vietnam, Singapore, and Hong Kong—the report was deleted almost immediately.

Seperately, Beijing-based Anbound Consulting last month had published a report calling for a change in the Zero COVID policy that survived for about a day before being suppressed.

As a result of the latest COVID outbreaks, over 300 million Chinese are, since late August, under some degree of restriction, with 74 cities under full or partial lockdown.

Within the past two weeks, eight megacities have gone into full or partial lockdowns. Together these vital centers of manufacturing and transport are home to 127 million people.

Nationwide, at least 74 cities had been closed off since late August, affecting more than 313 million residents, according to CNN calculations based on government statistics. Goldman Sachs last week estimated that cities impacted by lockdowns account for 35% of China's gross domestic product (GDP).

Zero COVID is not the sole source of China’s economic woes, as drought plus the metastasizing real estate and banking crises are also causing economic distress, but the policy has undeniably added a significant complication to those problems. The sudden lockdown of regions contributing over a third of China’s GDP is hardly likely to be impactful, yet that is exactly what the Zero COVID policy has accomplished in recent weeks.

Discontent Rises Over Zero COVID

The Chinese people’s reaction to Zero COVID lockdowns can be summed up in one word: fear.

Who can forget the scenes from Shanghai’s IKEA store last month, where shoppers literally ran for the exits when officials began locking the store down after the close contact of a COVID case was determined to have entered?

Shanghai in particular has reason to fear Zero COVID, after the city endured a full lockdown this past spring that left residents confined to their homes without food and basic supplies.

Shanghai: The Grim Reality Of Pandemic Paranoia

The government’s insistence on maintaining the lockdown in Chengdu even after a 6.8 magnitude earthquake rocked the region, killing more than 70 people, is also fueling dissent and disquiet over Zero COVID.

Some people bristle at the way enforcement of covid controls has fallen to relatively low-level functionaries, such as school administrators and building managers. Chinese netizens mocked a building manager in Chengdu who set a 7.0-magnitude earthquake as the threshold for allowing a breach of lockdown. The quake also led to renewed scrutiny of a common practice: officials locking, or even welding shut, fire exits to enforce lockdowns.

The struggling economy has contributed to the sour mood. It expanded by just 0.4% in the second quarter compared with a year earlier. On September 6th Nomura, a Japanese bank, said covid controls were affecting places responsible for 12% of China’s gdp, up from 5.3% the week before. Recent restrictions imposed on the southern city of Shenzhen, a manufacturing and technology hub, have added to the anxiety. Nomura revised down its Chinese growth forecast for the year, to 2.7%.

While many Chinese citizens are still more fearful of the virus than they are of Zero COVID, an ongoing question is how long will they remain that way.

“Who can get used to this?” said Zhang Lang, a grocery store owner in the southwestern city of Guiyang, who has been under lockdown for three days. “But there’s no choice,” he said. “The epidemic is coming. Do you want what happened in America to happen here?”

Still, the question is how long China’s calculus will remain in favor of the current approach. Youth unemployment is soaring, small businesses are collapsing, and overseas companies are shifting their supply chains elsewhere. A sustained slowdown would undermine the promise of economic growth, long the central pillar of the party’s legitimacy.

With economic damage and societal stresses continuing to increase as a result of Zero COVID, it is difficult to conceive that, at some point, costs will far exceed benefits (arguably, they already have), and Beijing will blink. For now, Zero COVID remains politically beneficial to Xi Jinping, leaving China with no good alternatives but to continue the lunatic lockdowns.

Zero COVID Means Lockdown Forever

That COVID cases have been declining since before the latest expansions of the lockdowns can only fuel the rising discontent—the lockdowns have not merely been a failure but a wasteful one at that.

China Is Turning Away From The World

As New Zealand’s decision to retire the remnants of its own version of Zero COVID, retaining only the isolation guidelines, illustrates, China’s response to the COVID pandemic is increasingly out of step with the rest of the world. The world’s other “Zero COVID” countries—places such as Singapore and Australia—have all been loosening their policies since fall of 2021, yet China has at every turn doubled down on the policy, increasing rather than decreasing the intensity of its lockdowns.

That the policies are inflicting severe economic damage on China, as well as creating multiple humanitarian crises from citizens under lockdown being denied access to even to food, has had zero impact on Xi Jinping and the Chinese Communist Party. For better or worse, Xi has pinned his own credibility and the overall legitimacy of the CCP on sustaining the Zero COVID policies.

This is not a new theme for China. As I have noted previously, China made a similar inward turn in the 15th century, abandoning its efforts at regional hegemony in Southeast Asia.

It Never Rains In China, It Just COVIDs

That decision and the decline which followed arguably contributed to the replacement of the Ming emperors by the Manchu Qing Dynasty in the mid-17th century. The loss of the major technological know-how and innovations represented by the Ming Dynasty’s Great Treasure Fleets left China an insular and stagnant society, little able to withstand the external predations by other countries during the late 18th and the whole of the 19th centuries.

While the outward circumstances and political motivations are different today, Beijing is making a similar inward turn over Zero COVID, moving away from the wider world, isolating itself behind a great wall of travel restrictions and quarantine rules, and even cutting the Chinese people off from one another with months-long lockdowns. It seems unlikely the CCP will miraculously escape the fate of the Ming emperors, even as China is already experiencing the beginnings of decline analogous to the stagnation that began under the Mings and persisted at least until the fall of Imperial China.

For the wider world, China is becoming a cautionary tale of the biological inevitability of infectious pathogens: “virus gonna virus.” Whenever governments put ideology and politics above scientific prudence and basic common sense, whenever governments flex their authoritarian muscles merely to show that they can, the people can be assured that things will not end well—not for the governments and most assuredly for the people.