23 cities, including Shanghai city, Zhengzhou city, Henan province, Shizong County, Yunnan province, have implemented a complete or partial lockdown this week that affects China’s GDP.

According to Reuters, on April 8, Shanghai city announced 21,000 new cases, while the number of cases during the outbreak surpassed 130,000.

The city’s nearly 25 million residents remained under lockdown and showed no sign of easing restrictions as it faced the third day of COVID testing on Friday, April 8.

The Beijing authorities intervened in Shanghai as they insisted the country must stick to the zero-tolerance policy. Although Shanghai implemented a lockdown in stages and massive testing, local authorities failed to deal with the COVID outbreak.

Following the detection of a few asymptomatic cases, Zhengzhou city, in central Henan province, announced on Thursday, April 7, that it would test all of its 12.6 million citizens.

In Shizong county in southwest China’s Yunnan province, shops were closed, the transport was suspended, and residents were barred from leaving their towns or villages.

As reported by CNN Business, Ting Lu, managing director, and chief China economist for Nomura, says that rising cases and strict measures all over China will have an impact on a wide variety of sectors, including in-person services, travel, logistics, construction, and some manufacturing.

Nomura, a Japanese Bank, estimated that 23 Chinese cities in China had implemented total or partial lockdowns this week. Those cities have a combined population of 193 million people and contribute 22% of China’s GDP.

Lu said, “These figures could significantly underestimate the full impact, as many other cities have been mass testing district by district, and mobility has been significantly restricted in most parts of China.”

In addition, about 40 Chinese companies had been forced to cancel operations in Shanghai and other areas by Thursday, April 7, according to stock exchange filings in Shanghai, Shenzhen, and Beijing.

Changchun city is a central manufacturing hub that has been shut down for 28 days.

According to Ernan Cui, an analyst at Gavekal Dragonomics who analyzed Covid policies announced by China’s 100 largest cities, the majority chose to keep restrictions in place even after case counts returned to zero.

In a note, she said the curbs “suggest that the economic impact of the various lockdowns will not ease in a matter of days or even weeks.”

According to Iris Pang, ING Chief Economist for Greater China, if Shanghai’s lockdown continues throughout April, the city will lose 6% of its GDP, resulting in a 2% GDP loss for China as a whole.

China has increased regular screening for employees in the city’s key sectors, forcing all personnel at elderly care agencies, schools, and institutions handling imported goods to take tests at least once a week.

At a news briefing on Friday, April 8, White House press secretary Jen Psaki said the Biden administration was ‘closely monitoring’ the Shanghai lockdown, adding that it could cause delays for air cargo and the measures “still could have an impact over the course of time.”

According to Forbes, a joint survey released on Friday, April 8, by the American Chamber of Commerce in Shanghai and the American Chamber of Commerce in China said 99% of the members who responded have suffered the impact of the recent outbreaks.

167 member companies, of which 120 have operations in Shanghai, participated in the survey. They report the outbreak has affected supply chains, manufacturing, revenue, investment, and staffing.

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