The country's worst Covid-19 outbreak since the start of the epidemic has led to a two-stage lock down of China's biggest city, Shanghai.
The southeastern coast of China is home to the city of Shanghai, which is a hub for finance and international business. The largest container-shipping port in the world is located in the city.
The suspension of public transit and ride hailing is one of the measures that have been put in place. Only a few neighborhoods had faced temporary lock downs to control pockets of outbreak.
The initial phase will run from Monday to Friday and apply to the eastern part of the city where the financial center is. The second phase will run from Friday morning to the afternoon of Tuesday, April 5, in the western part of the city.
Bruce Pang, head of macro and strategy, said that the mandatory testing district by district in China's largest city is likely to disrupt the city's commercial activity.
China will stick to its zero-tolerance approach and pursue its zero- Covid position as one of the world's strictest virus elimination policies in the near term.
According to sources, the factory located in the area covered by the first stage of the lockdown halted production for at least a day on Monday. The electric car company did not respond to CNBC's request for comment.
The emergence of the highly transmissible omicron variant has made it harder to control outbreaks. The latest wave of cases has been attributed to the omicron subvariant BA.2.
China has a strategy of controlling Covid outbreaks while maintaining economic growth. The country rebounded from the initial shock of the Pandemic in early 2020 with relatively few infections and deaths compared with other parts of the world.
This time around, economists don't expect a big impact on the national economy from a week or so of lockdowns. Travel restrictions and stay- home measures affect consumer spending and services more than factory production because workers can often stay on-site at industrial parks.
In the last few weeks, officials have emphasized how the city would not lock down and instead use a neighborhood-specific approach. The city claimed the two-part lockdown was for conducting virus tests in batches.
The production units of the port group were open 24 hours a day, except for extreme weather.
People wanting to leave the city during the two-stage lockdown will need a negative virus test within 48 hours of departure, rather than a blanket ban on travel.
The municipal transportation authority said that the two airports, one focused on international travel, and three train stations are operating normally.
There have been more new confirmed cases in the city.
The most cases for Sunday were reported in Shanghai. 50 new confirmed Covid cases were reported by the city.
The city said that all 3,500 affected individuals are in isolated treatment or medical observation.
The latest update to the national policy for Covid prevention and control said that mild and asymptomatic cases can be managed at theQuarantine centers instead of needing hospital care which would add to China's already stretched health-care system.
The northern province of Jilin accounts for most of the new confirmed locally transmitted cases. The number of new confirmed cases in most regions of China is less than 10 a day.
There were no new locally transmitted cases in Beijing on Sunday.
China's national railway operator announced Saturday that travelers would not be able to book tickets for April 8 or future dates in an indication of how authorities are trying to limit cross-country travel. The railway operator said that sales will resume on April 2.
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