Qilai Shen | Bloomberg | Getty Images BEIJING — The Covid situation in China is only getting worse, preventing the country from eradicating the virus and relaxing controls. The daily number of cases rose to a six-month high over the weekend. Guangzhou has indefinitely delayed the auto show that was supposed to start next week. And schools in Beijing are mulling over whether to switch lessons online, according to social media. As of Monday, China’s Covid controls have negatively impacted 12.2% of national GDP — up from 9.5% a week ago, according to Nomura’s model. The Japanese bank said more than a fifth of China’s population is subject to some sort of control measures. The southern province of Guangdong is the hardest hit, with cases mostly concentrated in one area. Recent Covid infections have been reported in more than 20 of China’s 31 province-level regions. “One thing is very clear, many business events have been canceled and postponed,” Klaus Zenkel, vice president of the EU Chamber of Commerce in China and president of its South China branch, said on Tuesday. “People don’t dare to travel. Too many restrictions,” he said, noting how companies from Guangzhou and Shenzhen “can’t even participate” in the China International Import Expo in Shanghai this week. “How do we maintain relationships with clients when we can’t meet face to face?” It was not immediately clear if there was any effect on factory output in the South China region. China’s commerce ministry did not immediately respond to CNBC’s request for comment. The heightened impact of Covid on China’s economy came during a week in which many investors speculated that China would soon relax its strict Covid policy. Officials dispelled the rumors on Saturday, confirming at a news conference that the current zero-Covid policy remains. “We continue to believe that while Beijing may improve some of its Covid measures in the coming weeks, these easing measures could be more than offset by tightening local officials. [zero-Covid strategy]Nomura’s chief China economist Ting Lu and a team said in a report on Monday.
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Mainland China reported more than 800 Covid infections with symptoms and more than 6,600 without symptoms on Monday. Other countries have a much higher daily case count but have chosen to live with Covid. Chinese authorities have raised concerns about the ability of the country’s already strained healthcare system to handle the surge in Covid infections.
