Uncertainty over China’s Covid policy adds to global economic worries

AS 2022 draws to a close, there appears to be hope, and some trepidation, over when China, the world’s second largest economy, will lift its strict Covid-zero policy and re-open to the rest of the world. Will it happen in the first or second half of 2023?

The cold realities of China’s pandemic-led policies – which have been in place since early 2020 but since tightened considerably amid surging Omicron waves – resurfaced on the back of rare protests over the weekend as exasperation and fury heightened over protracted lockdowns across the country. This even more so as the rest of the world has moved on, with reopened economies and borders.

The public fury was triggered by a deadly fire last week in the remote northwestern region of Xinjiang after videos of the incident appeared to suggest that lockdown measures had delayed rescuers from reaching the victims. While China has moved swiftly to quell the demonstrations, the protests – which also called for political change – has piled the pressure on President Xi Jinping to ease the country’s zero-tolerance Covid policy or face more discontent and social unrest. For that reason, there is some hope that there could be positive policy response from Beijing to the protests.