Virus restrictions must be changed to help the economy

BEIJING (AP) — A Chinese think tank issued a rare public dissent Monday with the ruling Communist Party’s strict “zero COVID” policy, saying restrictions that have shuttered cities and disrupted trade, travel and industry must be changed to to avoid an “economic stagnation”.

The Anbound Research Center did not elaborate on possible changes, but said President Xi Jinping’s government should focus on propping up sagging growth. He noted that the United States, Europe and Japan are recovering economically after easing disease restrictions.

“Preventing the risk of economic disruption should be the priority task,” the think tank said in a report titled: “It’s time for China to adjust its virus control and prevention policies.”

Even such mild public dissent from official policy is almost unheard of in a politically sensitive year when Xi, China’s most powerful leader since at least the 1980s, is expected to try to extend his time in power.

The report, dated Sunday, was posted on the Anbound Research Center’s accounts on popular messaging platform WeChat and microblogging service Sina Weibo, but was deleted from both on Monday afternoon.

The virus restrictions are widely expected to remain in place at least until after the Communist Party meets in October and November, when Xi is likely to break with tradition and award himself a third five-year term as leader.

Economists warn that China must boost growth that sank to 2.5 percent from a year earlier in the first half of 2022, less than half the official annual target of 5.5 percent, as Shanghai and other industrial centers were closed at the end of March to combat virus outbreaks.

“China’s economy is at risk of stalling” due to “the impact of epidemic prevention and control policies,” the think tank said.

The economy is also under pressure from a plunge in property activity after Beijing tightened controls on the sector’s use of debt.

Economists and public health experts have warned since mid-2021 that “zero COVID”, which aims to keep the virus out of China by isolating every case, is not sustainable. Officials respond that they have no alternative because the spread of the virus will overwhelm Chinese hospitals.

A Shanghai doctor with 3 million social media followers, Zhang Wenhong, was shut down from official criticism and targeted by a plagiarism investigation in 2021 after he suggested that China’s strategy could change and the world “needs to learn how to coexists with the virus.”

Founded in 1993, Anbound says it has served the Central Economic and Financial Leadership Group of the Communist Party and provided research to government agencies and financial institutions.

Her report gave no indication whether it represents the thinking of officials unhappy with the mounting financial and human costs of “zero COVID.”

China’s policy has kept death and infection numbers low, but led to a wave of business failures.

Local governments are reportedly cutting public services and civil servant salaries to pay for virus testing and disease-fighting measures.

The economic impact of repeated shutdowns of companies and neighborhoods is more severe than last year, the think tank said. He said the “freeze effect” could be even worse than when the epidemic began in 2020 and the entire economy was temporarily shut down.

On Monday, the southern city of Shenzhen, a technology and finance hub bordering Hong Kong, announced a three-day lockdown of some residential areas to contain the outbreak and shut down the world’s largest electronics market.

Also on Monday, the government of Shenyang, the most populous city in the northeast, postponed the start of in-person classes this week for elementary and middle school students.

China should “focus on economic recovery and gradually integrate with the world,” the Anbound report said.

Travel restrictions keep most foreign visitors away. The government has stopped replacing expiring passports and urged the public to avoid going abroad.

Last week, the US government canceled 26 Chinese airline flights to China from the United States in a dispute over Beijing’s virus controls. China earlier forced US carriers to cancel the same number of flights after some passengers tested positive for the virus.

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