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HK edition / 2022-12 / 16 / Page007

Easing of COVID curbs a boon to economic recovery

By Tu Haiming | HK EDITION | Updated: 2022-12-16 09:08

Tu Haiming says China's optimized anti-pandemic measures set the nation, including HK, back on track

COVID-19 restrictions on the Chinese mainland have been drastically relaxed of late. Following the announcement of 20 optimized anti-pandemic measures last month, the authorities released a 10-point plan this month to further ease countrywide COVID-19 quarantine measures, which has helped people realize that the country's anti-pandemic policy has fundamentally changed.

In places like Guangdong and Chongqing, where the COVID-19 virus still roams freely, the easing has been faster than expected. And businesses in Zhejiang province, in what is seen as a move signaling strong confidence in economic recovery, have organized business trips to Europe in the hope of procuring new purchase orders.

Currently, there are two competing views on the adjustment of the mainland's COVID-19 policy. While some argue that the relaxation has come too late, believing that it should have occurred half a year ago; the opposing side fears a greater risk of infection as pandemic controls and restrictions ease. Both sides lack objectivity in their argument as the latest easing move is timely and appropriate, and the decision was based on empirical data research and scientific calculations. The change in anti-pandemic policy heralds a quicker recovery on the mainland economy and signals a speedier return to normalcy in Hong Kong.

Globally, more countries have eased COVID-19 restrictions since July. In September, World Health Organization Director-General Tedros Adhanom Ghebreyesus expressed optimism for the first time and said he believes that the world can finally see light at the end of the tunnel. Thus far, more than 140 countries worldwide have lifted their pandemic control measures, which the Qatar World Cup perfectly illustrates, with tens of thousands of spectators gathered at each soccer game without wearing masks, and with matches being held over a period of more than three weeks in eight stadiums. The bustling soccer extravaganza signals that the pandemic is fading out.

For China, however, its unique national conditions warrant a steadier normalization process. China has a population of 1.4 billion, of which 267 million people, or 18.9 percent of the population, are aged 60 or above. Lifting pandemic restriction measures too quickly will inevitably expose this vulnerable group to a greater risk of infection. Besides, medical resources on the mainland are not on par with those in Hong Kong, let alone the US or developed countries in Europe. The good news is, while the coronavirus continues to weaken and to have a lower morbidity and mortality rate, China's vaccination rate is rising among the elderly and children. The medical and health sector has been closely monitoring the viral downward curve against the immunity upward curve so that they can determine the best time to adjust the national anti-pandemic policy. Therefore, the latest move to optimize the anti-pandemic policy did not come too late or too early.

Those who argue that the easing of measures was too soon, have wrongly equated omicron with the delta variant in terms of virulence. Many people have been used to the protection provided by the dynamic zero-COVID policy over the past three years, and have been caught off guard by the new notion that "everyone is the primary guardian of his or her own health".

The latest round of COVID-19 relaxations signals a new emphasis on economic development, which has borne the brunt of the pandemic onslaught over the past three years. In particular, the lockdowns in Shanghai and Shenzhen at the beginning of this year pummeled the value and supply chains and caused a slowdown in the country's economic growth, which is predicted to hover around 3 percent for this year, the second-lowest figure in more than 40 years since the start of reform and opening-up.

Nevertheless, the toughest period for the Chinese economy is over. Setting the agenda for next year's economic work in a meeting on Dec 6, the Political Bureau of the Communist Party of China Central Committee gave priority to the work of ensuring steady growth, employment and stable prices in 2023, emphasizing that "the proactive fiscal policy should be intensified for its effectiveness, and the prudent monetary policy should be targeted and effective. Industrial policies should boost development and security, and policies concerning science and technology will focus on self-reliance and self-improvement. Social policies must ensure people's livelihood". These five policy guidelines lay down a clear course of action that is set to inject impetus and vitality into the national economy.

Owing to the pandemic onslaught, China's economic growth has experienced sharp volatility over the past three years, with a rapid rise from 2.3 percent in 2020 to 8.1 percent in 2021, and it is expected to fall to about 3 percent in 2022. Had COVID-19 not occurred, the country would probably have maintained a steady 6 percent economic growth rate. With the optimization of China's pandemic control policy and the improvements in external circumstances, both the "internal circulation" and "external circulation" will fully open up, giving rise to promising prospects for China's economy in the future. The country's economic growth is forecast to reach more than 5 percent next year, the level it was at before COVID-19 struck the world.

The biggest opportunities for Hong Kong lie on the mainland. The city's international financial center has been benefitting from the rising number of initial public offerings of mainland enterprises, as well as from their insatiable demand for finance, trade, accounting and legal services as they expand their global reach. Meanwhile, Hong Kong needs to align its advantages in scientific research with the high-end manufacturing sector in the Pearl River Delta to achieve the desired industrial strengths. Hong Kong is bound to benefit further from the improved economic prospects of the mainland after the optimization of the anti-pandemic policy.

Immediately after the mainland adjusted its COVID-19 policy, Chief Executive John Lee Ka-chiu announced earlier this week that the city had reached a consensus with Guangdong and Shenzhen authorities to implement a new point-to-point arrangement, under which cross-boundary truck drivers no longer need to hand over cargo at the border; they can now deliver the cargo direct to the destination, an arrangement that will significantly reduce logistics costs.

Hong Kong's anti-pandemic policy will gradually align with that of the mainland, creating conditions for quarantine-free cross-boundary travel eventually, a crucial step for Hong Kong on its return to normalcy. This will be a step-by-step process and cannot be achieved in one go.

As personnel exchanges across the border are about to return to those of the pre-COVID-19 period, Hong Kong's business community should prepare itself for a sprint toward the boundless opportunities offered by the Guangdong-Hong Kong-Macao Greater Bay Area development. What a business can gain from such opportunities will depend on how much groundwork it has done before cross-boundary activities take off again.

The views do not necessarily reflect those of China Daily.

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