“We are very pleased with the crucial steps taken by the Chinese authorities to recalibrate the Covid policy, which will give better impetus to the recovery of growth in China,” IMF chief Kristalina Georgieva said after a conference in the Chinese city of Huangshan, which was hosted by Chinese Premier Li Keqiang.
The Chinese government announced Wednesday it would adjust its zero-tolerance policy on the coronavirus, likely ending widespread lockdowns in cities with rising infection rates. Additionally, some people who have tested positive for the coronavirus can be quarantined at home, rather than in special quarantine centres.
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According to Georgieva, the efforts promised by China to increase vaccination coverage of the population are “good for the Chinese population, but also important for Asia and the rest of the world”.
Light point
During the same press conference, World Trade Organization (WTO) director-general Ngozi Okonjo-Iweala said China’s relaxed policy “helps remove a number of uncertainties”. This is a bright spot in a world where the aftermath of the pandemic and the war in Ukraine is still causing high inflation.
The Chinese lockdowns have largely paralyzed public life in major cities, which has also taken a heavy toll on the economy. Analysts predict that China will miss its official target of 5.5% economic growth this year. The government’s erratic lockdown policies sparked massive anti-government protests in China last month.
“Foxconn urged relaxation”
A letter from Chinese iPhone maker Foxconn to the Chinese government may have played a decisive role in easing the corona measures in China. This was reported by insiders to the American newspaper The Wall Street Journal (WSJ). In the letter, Foxconn founder Terry Gou warns the government that these measures will harm China’s position in the global economy.
The letter was sent a month ago after unrest at Foxconn’s Zhengzhou plant due to coronavirus restrictions. In October, thousands of employees fled due to chronic food shortages. The new employees, in turn, rebelled against, among other things, the quarantine measures at the Foxconn plant, also known as Hon Hai Precision Industry.
Chinese government officials are said to have used the letter to put more pressure on the Chinese government to speed up the phase-out of the measures. Government officials and advisers have indicated that the strict policy has indeed been effective, but that the omikron variant of the corona virus requires a different approach. While the variant is highly contagious, it is also less deadly. By now the population would have had enough of the tough measures and China’s status as the “world’s factory” would also be at stake, according to officials.
According to a statement from Gou’s spokespersons, there would be no letter. Founder Gou already stepped down as CEO of Foxconn in 2019.