China Implements A Two-Phase Shutdown As COVID Levels Rise

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  • China’s financial hub of Shanghai launched a two-stage lockdown.
  • Areas to the west of the Huangpu River will have similar restrictions imposed from April 1 to April 5.
  • Tesla did not immediately respond to a request for comment.

Shanghai, China’s financial capital, imposed a two-stage lockdown on its 26 million residents on Monday. Closed bridges and tunnels and restricted highway traffic in an effort to contain the spread of COVID-19 as reported by Reuters.

Stronger response

The snap lockdown, announced by Shanghai’s city government on Sunday, will split the city in two roughly along the Huangpu River for nine days to allow for “staggered” testing.

It is the biggest COVID-related disruption to hit the city.

Wu Fan, a member of Shanghai’s expert COVID team, told a briefing recent mass testing had found “large scale” infections throughout the city, triggering the stronger response.

“Containing the large scale outbreak in our city is very important because once infected people are put under control, we have blocked transmission,” she said, adding that testing would be carried out until all risks were eliminated.

A record 3,450 asymptomatic COVID cases were reported in Shanghai on Sunday, accounting for nearly 70% of the nationwide total, along with 50 symptomatic cases, the city government said.

Disruptions

As a major engine of China’s economy, Shanghai has been trying to heed President Xi Jinping’s call to minimise the impact of COVID controls on businesses and people’s lives.

Wu told a briefing on Saturday that Shanghai could not be locked down for long because of the important role it played in the national and even global economy.

Areas to the west of the Huangpu River will have similar restrictions imposed from April 1 to April 5.

The bureau said traffic controls would be implemented on highways into and out of the city, and people leaving would have to show proof of negative results from nucleic acid tests taken within the previous 48 hours.

It also ordered the suspension of work at firms and factories, with the exception of those offering public services or supplying food.

Services at several hospitals throughout Shanghai were also suspended as they release staff and other resources to assist with mass testing.

Manufacturers shut down

Tesla (TSLA.O), a California-based manufacturer, is shutting down its manufacturing in the city for four days, according to two people familiar with the situation. The plant is located in a Shanghai neighbourhood that has been affected by the first stage of the lockdown.

A request for comment from Tesla was not immediately returned.

Semiconductor Manufacturing International Corporation (0981. HK), a Chinese chipmaker, declared, however, that activities at its Shanghai factory were regular.

The recent increase in COVID cases in China has put the burden on the world’s second-largest economy, potentially lowering consumer spending even further.

“Markets should be especially concerned about a decline in growth in Q2 due to the high transmissibility of Omicron and reinforced (zero-COVID approach),” Nomura analysts wrote in a report on Saturday.

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Source: Reuters

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