As long as China can maintain industrial production, thanks to the closed-loop system that keeps workers isolated, service-sector weakness will probably be tolerated. Covid-19 is here to stay and this raises the question of whether zero-Covid is a policy mistake or a tool for social control.
Under current pandemic control measures, China’s unemployment situation could get as bad as 2020 when as much as 12 per cent of the working population was jobless, academics warn.
Policy U-turns and a heavy-handed, unpredictable coronavirus control strategy are fraying the nerves of China’s business community, dampening spending and private investment as the economy slows.