Unemployment of young urban people (16-24 years old) which jumped to 18.2%, a prime minister, Li Keqiang, who evokes an employment situation “complex and dark”, industrial production down 2.9%, retail sales down 11.1%… In April, the Chinese economy was even worse than analysts had anticipated. In fact, no one had imagined that Beijing would, in the name of its zero Covid policy, go so far as to impose strict confinement on its economic capital for around two months.
Since the appearance of the virus in 2020, hasn’t the city been the unofficial showcase of a country which, despite the principles erected by the Chinese authorities, knew how to be pragmatic and manage the zero Covid in a way “dynamic” ? “It’s hard for a Shanghainese not to be snide at our friends in the North, every time we read about new restrictions in Beijing”wrote, at the beginning of January, Dan Wang, an analyst of Gavekal Dragonomics, based in Shanghai.
For many multinationals, settling in this city made it possible to benefit from access to the Chinese market, while offering “Western-style” living conditions to expatriates. The myth has collapsed.
Shanghai is run by Li Qiang, a Xi Jinping man born in Zhejiang, whose career depends much more on the general secretary of the Chinese Communist Party (CCP) than on his popularity with his constituents. Result: according to Bloomberg, more than one hundred and eighty companies around the world already believe that the containment of Shanghai will have a negative impact on their results.
Beijing won’t reopen until 2024
In addition to the submission of Shanghai to Beijing, the confinement of the first confirms that in the eyes of the leaders, economic growth is no longer a priority. Since the suppression of the Tiananmen uprising in June 1989, a tacit consensus seemed to have been established: the power ensured the economic growth and prosperity of the people and, in exchange, the latter let the CCP manage affairs as it wanted. heard. According to Westerners, the zero Covid policy has challenged this modus vivendi. For Xi Jinping, political control and social stability take precedence over economic development.
The CCP’s takeover of the Chinese tech giants from the fall of 2020, the scheduled closure of organizations providing private lessons for students in the summer of 2021 or the speeches on the “common prosperity”. Xi Jinping indeed announced, in September 2020, “the victory of the Chinese people against the virus”thanks to the zero Covid policy, and the facts cannot prove him wrong two years later, on the eve of the XXand CCP congress, “whatever the cost economically”.
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