September 2, 2022 at 9:11 am
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Chengdu implemented city-wide static controls to contain the new coronavirus outbreak. At present, Chengdu allows each resident to arrange one person per day to go out to buy daily necessities with a negative nucleic acid certificate within 24 hours.
Following Shanghai, another Chinese city with a population of more than 20 million has entered a state of near “closed city”.
Chengdu City, Sichuan Province announced that from 18:00 on September 1, all residents of Chengdu will “stay at home in principle”. Many Chengdu citizens rushed to vegetable markets and supermarkets to buy food in large quantities in response to the lockdown.
This round of the epidemic started from a cluster of infections in a fitness and swimming pool in Chengdu. The first case was reported on August 25, and the number of newly confirmed cases exceeded 100 on the 28th. In less than a week, Chengdu has reported a total of 766 confirmed cases.
On September 1, the Chengdu New Crown Epidemic Prevention and Control Headquarters announced that from 18:00 on September 1, all residents will stay at home in principle. Citizens who undertake the basic urban operation guarantee, medical security and epidemic prevention tasks can enter and leave the community with an electronic pass, work permit or unit certificate, and a nucleic acid negative certificate within 24 hours.
However, Chengdu has not yet reached the level of closure and control in Shanghai this spring. At present, Chengdu allows each resident to arrange one person per day to go out to buy daily necessities with a negative nucleic acid certificate within 24 hours.
Supermarkets (including farmers’ markets), pharmacies, medical institutions, fresh food express delivery, e-commerce distribution, and catering enterprises that guarantee the basic needs of citizens (cancelling dine-in and only providing express delivery services) are also allowed to operate. The frequency of subway trains is 10 minutes apart. However, taxis and shared bicycles will not operate.
Chengdu officials announced that on September 2, the city’s supermarkets and farmers’ markets were open for business throughout the day. The city’s 31 key supply guarantee companies increased the stocking and distribution of daily necessities such as meat, vegetables, eggs and milk at 2-3 times the daily standard. quantity. State media are also repeatedly promoting that there is no need to stock up.
However, the announcement of “staying at home in principle” still caused Chengdu residents to be fully dispatched. There were long queues in supermarkets, and some vegetable vendors directly placed large piles of vegetables on the street, which were quickly snapped up by residents.
blocked city
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Since 18:00 on September 1, all residents of Chengdu will “stay at home in principle”. Many Chengdu citizens rushed to the vegetable market and supermarket to buy food in large quantities to cope with the state of closure.
Prolonged lockdowns in megacities can have a huge impact on the economy.
In April and May this year, Shanghai entered a total blockade due to the epidemic. As China’s largest city and economic center, the blockade of Shanghai had serious economic consequences.
According to data from the National Bureau of Statistics of China, Shanghai’s GDP fell by 13.7% year-on-year in the second quarter.
Not only that, as the hub of the regional economy, Shanghai has close supply chain links with other provinces and cities in the Yangtze River Delta, which has the largest manufacturing cluster in China.
The economic volume of Chengdu is regarding half that of Shanghai, but the population is not much different. The permanent population of Chengdu is 21 million, which is less than Shanghai’s 25 million.
But Chengdu is an important southwest central city, and the hub is of great significance. For example, the passenger throughput of Chengdu Shuangliu International Airport last year was 40.117 million, ranking second in the country.
Secondly, as a major consumption town, Chengdu has just experienced the crisis of power cuts and shutdowns, and then entered a state of blockade. For residents’ consumption, it has experienced a double blow.
From the perspective of China’s overall economy, the economy almost stagnated in the second quarter, and the pressure to stimulate growth in the second half of the year is great.
economic chill
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Judging from the official voice of China, the authorities have no plans to relax the epidemic prevention and control policy.
However, in addition to Chengdu, Shenzhen also broke out once more.
Starting this Monday, dine-in in Luohu and Futian districts in Shenzhen will be suspended, and all takeaways and express delivery will not enter community communities and urban villages. Entertainment venues such as movie theaters, Internet cafes, KTV, scripted entertainment business venues such as script killings, and indoor closed places such as swimming pools are temporarily closed.
The latest data shows that China’s economy slowed down across the board in July, with total retail sales of consumer goods growing by 2.7%, down 0.4% from June. Before the epidemic, the data maintained double-digit growth for a long time. Large cities such as Chengdu and Shenzhen with large populations are the main force of consumption.
“We are particularly concerned regarding the health of small business owners.” Xu Tianchen, an economist at the Economist Intelligence Unit (EIU), said that while overall household income continued to grow in the first half of the year, income from business operations declined. Small business owners have been hit harder by the containment measures, many of whom are at risk of having to close their doors amid the sudden and severe lockdown.
Lockdowns in more major cities are adding to the woes of the economic recovery.
Chinese think tank “Anbang Consulting” said that China’s economy is at risk of stalling, and the biggest factor is the impact of the epidemic. Compared with the current situation of the epidemic and economic development in the international community, the so-called “epidemic shock” is not actually the epidemic itself, but the impact of epidemic prevention and control policies.
“The causative harm of the new crown epidemic has been greatly reduced, and preventing the risk of economic stall should be the number one task in China. If China wants to seek advantages and avoid disadvantages under the complex international geopolitical and economic situation, it needs to adjust scientifically according to the latest changes in the epidemic. The epidemic prevention and control policy focuses on economic recovery, and gradually integrates with the world during the period of normalized prevention and control.” Anbang Consulting believes.
Xing Ziqiang, chief economist of Morgan Stanley China, reminded that what is more important is whether this leads to permanent scars in the economy, such as consumers starting to adjust future employment expectations, gradually appearing long-term psychological and income scars, and household balance sheets deteriorating, etc. The proportion of households with problems has risen from less than 10% at the beginning of the year to around 24%.
“Even if the epidemic prevention policy is adjusted to provide more assistance at the consumption level, once the policy is released, whether there will really be retaliatory consumption is very worthy of attention.”
