BEIJING (Bloomberg/Asia News Network): China eased its Covid-19 quarantine regime, cutting in half the time new arrivals must spend in isolation in what is the biggest shift yet in its pandemic policy.
Travellers to the country must spend spend seven days in centralised quarantine, then closely monitor their health for another three days at home, according to a government protocol released Tuesday (June 28) by National Health Commission.
Previously, China required up to 21 days of hotel quarantine, though some people previously could do their last week at home.
Testing requirement during the quarantine period were also reduced. Travellers now are required only to give throat swabs, eliminating the laboratory tests that previously required nasal swabs.
The new guidelines, the first update since May 2021, make no mention of vaccine requirements for travellers.
The National Health Commission also is making it a priority to increase vaccination and booster rates, particularly for those 60 years and older and others at high-risk of severe disease.
The news buoyed investors. China’s CSI 300 extended gains to 0.7 per cent as of 2.20pm in Shanghai, with hotel and airline stocks rallying. Futures contracts on S&P 500 also extended gains to 0.5 per cent after the news, while the yuan erased losses to rise in both offshore and onshore markets.
This comes as the capital Beijing and financial hub Shanghai both recorded zero new locally-transmitted Covid infections for Monday (June 27), the first time the two cities had no virus freely circulating since Feb 19.
Nationwide, China reported just 22 cases, according to the National Health Commission.
Reaching the milestone in China's two most important cities shows it is possible to eliminate the virus despite the arrival of the highly-contagious Omicron variants that are able to evade immunity gained from vaccination.
The victory has come at a significant cost, however, and doesn't mean the fight is over.
New infections could emerge at any time, triggering a renewed cycle of containment in either city.
China itself hasn't been virus-free since October, but is still pursuing its intensive zero-Covid strategy.
"It’s not surprising that China has managed to return to so-called zero, after all the huge effort it’s made," said Huang Yanzhong, a senior fellow for global health at the New York-based Council on Foreign Relations.
"But that doesn’t mean it can claim a thorough and durable victory because it didn’t eradicate the virus," he said.
"Unless they thoroughly fence off Beijing and Shanghai, the virus could sneak in anytime."
Halting local circulation of the virus required harsh measures to root out infections and halt chains of transmission.
In Shanghai, which last reported no new community cases on Feb 23, more than 25 million residents endured a two-month lockdown.
Targeted restrictions, extensive contact tracing and regular testing are now widespread in both cities.
The demands of the zero-Covid approach show how difficult it is for Chinese officials to stamp out the infectious pathogen for long, and underscore the risk facing the world's second largest economy.
Many now expect Beijing to miss its 5.5 per cent growth goal for the year, with economists projecting 4.2 per cent gross domestic product gains in 2022.
The repercussions are being felt around the world, with Nike Inc the latest company to offer a gloomy forecast based on dimming expectations in China.
Zero tolerance is isolating China from the rest of the world, which is awash in the virus after shifting to living with it.
Still, Chinese authorities are under massive pressure to insulate the economy from zero-Covid, especially ahead of the Communist Party congress later this year when President Xi Jinping is expected to secure an unprecedented third term.
There is no end in sight for local leaders who are juggling efforts to keep Covid out while spurring their economies.
At least five key cities and provinces have said virus control measures will continue as their party chiefs – many of whom are Xi’s close allies – addressed local party congresses in recent days.
Chongqing party boss Chen Min’er pledged "no slack" in implementing Covid control measures.
Tianjin’s Li Hongzhong promised to normalise pandemic prevention. And while Beijing Daily retracted a report that sparked a social media backlash for saying the capital would stick to a zero-tolerance approach "in the next five years," it was based on comments from party leaders who were addressing the major tasks for the next five years.
Meanwhile, Shanghai’s leader said the city’s approach was "completely correct" as he declared victory in defending the financial hub against Covid-19.
Most pandemic restrictions in Beijing, which last reported zero cases on April 16, are on track to be eased and students will be allowed to return to in-person school on Monday.
But there is a new normal. Residents are required to show a green code on a mobile app that tracks their health status, and take a Covid test every three days to enter any public venue, including restaurants, shops, and mass transportation. Even kids aged over three must be tested to play in the park.
The virus is still circulating elsewhere in the country, as well.
Several cases have emerged in the technology hub Shenzhen, which is in the spotlight as Xi is expected to stay there later this week during the 25th anniversary celebration of the handover of Hong Kong to the Chinese.
His attendance is also anticipated at the swearing-in ceremony for the city’s incoming chief executive John Lee.
There were five local infections in Shenzhen on Monday, found after the Futian district that borders Hong Kong was locked down, non-essential businesses were shut and restrictions were imposed on residents leaving their compounds.
The northern port city of Tianjin reported four Covid infections on Monday. They were found during regular checks of staffers working in a closed-loop system used for inbound international flights, state media reported, citing the municipal government.
It’s unclear how or when China will exit the zero-Covid mindset.
"From the government perspective, authorities think the costs are worth it as they believe they have avoided the most dangerous situation," said Huang, from the Council on Foreign Relations.
"And while the government claims the social and economic costs are still affordable, there are far larger indirect costs that haven’t been taken into account," he said.