- Lockdowns and global situation affect trade
- China relaxes Covid rules
- TSMC: 40 billion investment in Arizona
- EU advances WTO case against China
- Germany approves Sinovac vaccine
- Heads: Czech researcher Ivana Karásková
The Chinese government has discreetly laid its zero-Covid strategy to rest. While democratic ministers would have loudly proclaimed the relaxations, Chinese bureaucrats step in front of the press and talk about “optimizations” of the existing policy. In fact, everything that defines zero-Covid has been abolished: widespread lockdowns, strict isolation of infected individuals and their close contacts, the dictates of the Covid health app, exhausting endless testing, and permanent distance classes. Now, the name of the game is instead: vaccination, vaccination, vaccination. Xi Jinping is still full of surprises after all.
The departure from zero-Covid is a reaction to the recent protests, but also has economic reasons. China could miss its self-imposed growth target by a wide margin this year because of the lockdowns. This is indicated by the current slump in foreign trade, analyzed by Felix Lee. Those who now gloat should first read the text. After all, foreign trade also includes, above all, German imports, whose exports declined sharply as a result.
In today’s Profile, we introduce Ivana Karásková. The Czech researcher from Prague focuses on the consequences of disinformation and the influence of the People’s Republic in Central and Eastern Europe. Next Wednesday, Karásková and two other experts from Hungary and Serbia will be guests at our Table.Live briefing, where we will take a look at China in the region.
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Finn Mayer-Kuckuk
Feature
Foreign trade crashes
Most economists were well aware that China’s economy is not in the best of shape, considering the numerous lockdowns throughout the country. But the magnitude still surprised many: Last month, China’s foreign trade suffered the worst slump since the start of the Covid pandemic in February 2020. It dropped by 9.5 percent year-on-year, according to the General Administration of Customs. The deficit in exports was minus 8.7 percent, while imports fell by as much as 10.6 percent.
The strict zero-Covid policy was probably the main reason for the poor numbers. Repeatedly, entire urban areas have been cordoned off due to allegedly high infection rates. The lockdowns in November interrupted supply chains and dampened consumer mood in China, Jens Hildebrandt, Executive Director of the German Chamber of Commerce in China (AHK) in Beijing, told Deutsche Presse-Agentur. In addition, he said, there were disruptions in supply chains. “Many goods could not be produced because of a lack of preliminary products that could not be delivered at all,” said the head of the chamber.
Supply chains actually stabilized again
The collapse of Chinese foreign trade also hits the German economy hard. German exports to the People’s Republic were down 17.5 percent. China’s exports to Germany fell by 14.4 percent. The decline of Chinese exports to the USA is even larger. In November, exports to the US were down 25.4 percent and China imported 7.3 percent less from the United States. Many containers on their way to the USA remained empty.
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