China may have ‘passed the point of no return’ as Covid infections soar

Larry Hu said that it is harder for the government to achieve zero Covid without reverting to a harsh lock down.

In the last few days, the daily case count has climbed to around or more than 28,000, which is close to the levels seen in April during a stringent lock down in Shanghai. The last time mainland China saw less than a few infections per day was in June.

The latest Covid wave has hit the southern city of Guangzhou, the capital city of Beijing and many central parts of China, prompting officials to tighten restrictions on business and social activity.

The road to reopening is set to involve lots of back-and-forth.

Hu said that China might have already passed the point of no return, as it is unlikely to achieve zero Covid again. Tighten the Covid controls and flatten the curve to slow the spread of virus.

Hu pointed to slight changes this month in government policy and propaganda as a sign that authorities are getting ready to reopen in six to nine months. The road to reopening is going to involve a lot of back and forth.

Markets have been speculating about the timing of China's departure from its zero- Covid policy. During the first three quarters of the year, the economy barely eked out growth, which was weighed down by the controls.

Nearly 20% of China's economy was negatively affected by Covid controls as of Monday, close to the high of 21.2% recorded in mid-April.

Lu said in a report this week that Beijing has shown early signs of willingness to reopen, but it may take a long time.

The path forward for China could be revealed by Vietnam's unraveling of its Covid restrictions. The Southeast Asian country saw no immediate surge in infections after it pivoted.

The task of trying to make Covid measures more targeted has been difficult for local authorities in China.

More than 400 million people were affected by the measures in mainland China. It was up from the previous week.

Many controls are implemented without public notice. The report said that the southwestern municipality of Chongqing is currently experiencing the most severe local lock down in China.

The covid controls in Beijing have been tightened.

The authorities ordered more restaurants to stop in-store dining. There are more malls that have closed. Apartments have been locked down.

According to state media, the city's tech-focused Zhongguancun Forum that was scheduled to kick off this week will be delayed. The conference was pushed back from September.