China’s Covid lockdown situation is deteriorating, according to Nomura, which said nearly 300 million people are now affected by restrictions imposed in 49 cities.
The financial services group said in a note on Tuesday it is cutting its growth forecast for the third quarter by 0.3% points to 2.6% over the previous year because China “is battling the broadest wave of Covid infections thus far”.
“As of 6 September, 49 cities are currently implementing various levels of lockdowns or some kind of district-based control measures,” chief China economist Ting Lu said, adding that “we estimate around 291.7 million individuals are currently affected by these measures.
The cities and regions affected account for around 28 trillion yuan – over $4 trillion – of gross domestic product, with over a fifth of China’s population and close to a quarter of national GDP, he said.
Shanghai’s Lujiazui Forum Delayed
One high-profile casualty of the Covid curbs was the postponement on Tuesday of a key financial gathering set for this week in the financial hub of Shanghai.
The Lujiazui Forum has been delayed from the initial dates of Wednesday and Thursday, the Shanghai Municipal Financial Regulatory Bureau said in a statement, without giving new dates or saying if the recent outbreaks were a factor behind the move.
“This year’s Lujiazui Forum is being delayed due to the need to deepen the (event’s) topics,” it said.
The delay comes amid a fresh wave of Covid outbreaks in cities such as Shenzhen and Chengdu, and a time when China is gearing for a five-yearly congress of the ruling Communist Party on October 17, where President Xi Jinping is poised to secure a historic third leadership term.
The Lujiazui Forum is an annual event co-hosted by the city government and top financial regulators, such as the People’s Bank of China (PBOC), the China Banking and Insurance Regulatory Commission (CBIRC) and the China Securities and Regulatory Commission.
Late last month, Shanghai authorities urged organisers to postpone or scale down conferences and exhibitions, so as to boost Covid prevention efforts.
The Beijing auto show and sports tournaments, such as the Diamond League athletics meet, are among the events in China postponed or cancelled this year due to Covid.
Chengdu Locked Down, Quake Toll 66
Meanwhile, in the country’s southwest, firefighters worked in treacherous terrain to help evacuate more than 11,000 people after a magnitude-6.8 quake struck the province of Sichuan on Monday, killing at least 66 people.
State media footage, taken at the epicentre in Luding county, showed firefighters stretchering an injured person across a makeshift bridge built with tree trunks as muddy torrents raged below them.
As rescuers tried to reach stranded people, restore utilities and send emergency relief, state media reported 11,000 people had been evacuated from the area.
Authorities identified around 500 potential geological hazards, according to the reports, referring to landslides and collapsed mountain roads.
State television reported that 243 houses had collapsed and 13,010 had been damaged. In all, more than 250 people were injured in the disaster.
Officials in the provincial capital, Chengdu, put its 21 million people under lockdown last week. And yesterday officials extended the lockdown for most people to Wednesday to enable authorities to complete another round of mass testing.
- By Jim Pollard, with reporting by Reuters.