According to Bloomberg, President of Goldman Sachs John Waldron said that China’s road to reopening could be “bumpy” after the country shows signs of easing lockdowns. When combined with the possibility of a slight recession in the U.S. and Europe, it could result in a more challenging economic environment.

Speaking via video conference at Shanghai’s Bund summit, Waldrun said China’s difficulties in reopening will “obviously have some negative implications for growth.” 

The comments highlight how global banks are evaluating the effects of China’s decision to abandon its zero-COVID policy, along with the impact of geopolitical unrest and a decline in dealmaking.

The news outlet reported that global banks are reducing China-focused investment bankers as they question whether the country will ever become the favorite destination as once forecast.

Waldron’s comments come after the Chinese regime has relaxed COVID restrictions as it seems to move away from the zero-COVID strategy.

China lifted lockdowns as its capital Beijing is easing some pandemic rules starting December 6.

As state-backed China Daily reported, people have been allowed to enter public areas without a valid negative test result. But health code scanning remains a hurdle. Applicable areas include parks, supermarkets, offices, and airports. 

But negative test results are required for indoor areas, such as cafes, bars, karaoke rooms, schools, and kindergartens.

The country is expected to face a further infection surge as it gradually loosens the zero COVID, which might cause further economic disruption. 

Beijing’s controversial zero-COVID policy has caused a tremendous impact on the economy, affecting people’s daily lives and other social problems. 

The key reason for the regime to lift lockdowns comes after widespread protests across the country following a fire that killed at least ten people in Xinjiang due to brutal COVID-controlled measures. 

Most international financial institutions have adjusted their forecast for China’s 2022 economic growth rate to around 3%, well below the official target of 5.5%.

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