Is Xi’s zero Covid policy plunging China into a recession

Chinese President Xi Jinping’s draconian zero covid policy is the reason why the country is heading into recession, Valerio Fabbri writes in a Slovenian publication Portal Plus citing Chinese citizens.

A Beijing-based citizen said, “I can feel the recession around me. Obviously, the economy is heading down. Fewer people in shopping malls, the disappearance of small businesses and higher prices for daily goods are better proof than official data. It is just a catastrophe now, not because of Covid but because of stupid policy.”

China, which is currently witnessing strikes on a daily basis because of its covid policy, had to face unprecedented economic repercussions, which have created ripple effects all over the world ultimately impacting the global economy.

In November, a protest erupted at Foxconn’s flagship iPhone plant in China where men and women were captured in the footage marching with some of them confronted by people in Hazmat suits and riot police, Reuters reported citing videos circulated on social media.

The protests in China mark an escalation of unrest at the massive factory in Zhengzhou city. The workers were frustrated with the delayed bonus payments, as the demonstrators said on Livestream feeds. The videos could not be immediately verified by Reuters.

Following a major COVID-19 outbreak in October, which led to a majority of workers leaving the factory compound out of fear of barbaric methods adopted to deal with these situations, the manufacturer held an employment drive that ultimately received over 100.000 applicants, according to Portal Plus.

Matters took a turn for the worse when incoming employees were promised a bonus payment of 3000 yuan after 30 days on the job, and another 3000 yuan to be doled out at the completion of 60 days but it turned out to be a hollow promise.

Now, things stand at such a delicate turn where the manufacturer, Foxconn, has gone as far as to pay the workers two months of wages (USD 1400) to quit and leave the facility. This drastic step came in light of the wildly violent turn the protests had taken when the workers were met with brute force and suppression at the hands of the authorities.

Not only Foxconn, but the automobile industries like Honda and Yamaha had to also keep their operation suspended in their factories in the Chongqing district.

Meanwhile, Volkswagen suspended production at its plant in Chengdu, following fresh waves of COVID cases being reported.

Tesla’s factory in Shanghai is the case in point, where workers were expected to sleep on the floor during the months when the city was under lockdown earlier in the year, reported Portal Plus.

China’s COVID-response has proved to result in a lose-lose situation. Nor is the zero-COVID policy able to contain the spread of the virus, nor is it capable of preventing virus outbreaks in the first place. And the restrictions that are expected to be followed are only acting as a deterrent, instead doing a very efficient job of swiftly driving out the production lines of businesses from the country, the author writes.

According to a survey conducted by the EU Chamber of Commerce on businesses in China, 78 percent of responding brands said the country was an unattractive choice for investment, owing to its COVID response.

Also Read: https://www.indianarrative.com/economy-news/chinas-growth-projections-sink-further-amid-covid-surge-86654.html