Reuters reported that due to Covid-19 rapidly spreading, island Hainan authorities decided to expand the lockdown to more areas on August 8. And the lockdown had an immediate effect on Hainan’s economy.

Considered China’s Hawaii, Hainan had just two symptomatic cases last year. However, from Aust 1 to August 8, this island, whose economy heavily relies on tourists, recorded 1,500 infected cases. This is Hainan’s biggest outbreak since Covid-19 was first reported in Wuhan in late 2019.

On Aug 8, the Hainan government put four more localities under lockdown status. That is Haikou city, the Hainan capital and home to about 2.9 million people, and three cities, Wuzhishan, Ledong, and Chengmai.

So far, at least Hainan’s nine cities have declared lockdown residents under hard rules. The population of about 7 million were required not to go out of or enter locked areas. 

The cities’ authorities also require all residents to take a Covid test, close public transport services, and restrict people from accessing crowded places.

Zero-Covid policy, taking lockdown as the basis, continues to negatively affect the Chinese economy. Chinese stocks in tourism, transport, and consumer staples all decreased on Aug 8.

Lockdown also seriously affects the aviation sector. Hainan Airlines shares fell 1.5% on Aug 8.

The lockdown comes during the high tourist season for Sanya, the key tourist hub and the hardest-hit city in Hainan’s outbreak. So, this has seriously affected the revenue of Sanya in particular and Hainan in general, as well as significantly impacting the Chinese economy.

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