Shanghai targets lockdown turning point by Wednesday; unveils business restart plan

[SHANGHAI] Shanghai has set a target to stop the spread of Covid-19 outside of quarantined areas by Wednesday (Apr 20), 2 people familiar with the matter said, which would allow city to further ease its lockdown and start returning to normal life as public frustrations grow.

The target will require officials to accelerate Covid testing and the transfer of positive cases to quarantine centres, according to a speech by a local Communist Party official dated Saturday, a copy of which was seen by Reuters. Ending community-level transmission has been a turning point for other Chinese localities that locked down, such as Shenzhen city which last month reopened public transport and let businesses go back to work shortly after achieving that target.

A speech dated Saturday by the party secretary of the city's Baoshan district described it as an order that had come as the city's situation reached a "critical moment" with growing public anxiety and food supply pressures.

"The State Council Working Group, the municipal party committee and municipal government have asked that the turning point of the epidemic should appear on the 17th and that zero-Covid status should be reached on the 20th", Chen Jie said in the speech.

One Shanghai resident told Reuters her neighbourhood committee sent out a notice on Sunday to residents that more workers and buses had been mobilised to speed up the transfer of positive cases in their compound to quarantine centres.

Images and videos circulated on Chinese social media on Saturday evening showed numerous buses lined up to take away long lines of people who were said to have tested positive for Covid outside a town in Shanghai's eastern Pudong district.

Of 23,643 new local infections Shanghai reported for Saturday, 722 were found outside quarantined areas, according said Wu Jinglei, director of Shanghai's health commission. He told a news conference on Sunday that the figure had declined in the past 2 days.

China's "dynamic clearance" approach to Covid control requires authorities to centrally quarantine all cases and isolate their close contacts. Beijing authorities intervened in Shanghai in early April, after the financial hub failed to isolate Covid-19 despite locking the city down in stages.

Business leaders have been increasingly outspoken about the toll of the lockdowns on the Chinese economy, with carmakers warning they could be forced to stop production completely if their suppliers in Shanghai and neighbouring areas could not resume work soon.

On Friday, China's industry regulator said it had identified 666 companies in Shanghai in the semiconductor, automobile and medical sectors as priority firms that needed to resume work.

Businesses should formulate plans for closed-loop management, where workers live on-site and are tested regularly. They should also apply for approval to restart production with Covid control authorities at the district and city levels, Shanghai's Economic and Information Technology Commission said in a statement on its WeChat account. The agency did not provide a timetable of work resumption.

The lockdown in China's financial hub, now in its third week, has squeezed everything from consumer spending to logistics and production. The key to addressing the economic woes is adjusting China's Covid Zero policy, analysts said, as the Chinese central bank takes a cautious approach with monetary easing. But top officials have repeatedly warned about risks to growth and the need for more monetary and fiscal stimulus.

Shanghai is a production base for many companies, including Tesla and China's state-owned SAIC Corp. Tesla is calling back its workers in the city to prepare for the initial resumption of production as soon as the coming week.

Of Shanghai's 849 sizeable vegetable producers, 667 have resumed production, Lu Zhengrong, an official with the Shanghai Agriculture and Rural Affairs department, said at a briefing on Sunday.

Under the new work-resumption plan, different parts of factories must be separated, and all staff members should work and live in designated locations, reducing direct contact with people in other areas as much as possible, according to the statement.

Visitors will be tightly restricted, and company truck drivers must provide negative nucleic acid test results within 48 hours or a negative antigen test within 24 hours, before entry, it said. Makeshift hospitals should be set up at firms with a large number of workers, according to the statement. REUTERS, BLOOMBERG