The Omicron outbreak in Shanghai is one of a series across the country that tests the government’s ability to enforce a strict “zero COVID-19” strategy without disrupting the economy and people’s daily lives too much. Many shops were closed and pedestrians were sparse even in half the city that remained open. The lockdown is being carried out in two phases to limit the disturbance, starting in Pudong Economic Zone and adjacent areas on the east side of the Huangpu River that separates Shanghai. Zhang Meisha, doing a morning jog along the legendary Bund on the west bank of the river, said she hoped to enjoy more sunshine before the lockdown was transferred to Puxi. Only a casual tourist lived on the promenade with centuries-old historic buildings. “It’s so beautiful, but not many people can come here to enjoy and appreciate it,” Zhang said of the red and yellow tulips along the Bund. “Too bad! I hope Shanghai Spring awaits us.”

Market stress

The closure has added to concerns in financial markets in addition to Russia’s war in Ukraine, the US Federal Reserve’s effort to reduce rising inflation by raising interest rates and other economic challenges facing the global economy. Market reactions, including Monday’s 7 percent drop in oil prices in London, do not reflect the “real situation”, but investors were already worried about China and the global economy, said Michael Every of Rabobank . “We have a whole mountain of problems to worry about, and that is just one of many,” said Every. “If that’s all, a lockdown for COVID, it’s not hard to look at recent history books and see how it goes. But that’s a lot of other issues.” Any shutdown in Shanghai port is a major threat to industry and trade. State media reported that the world’s largest port handled normal volumes of cargo and that operators ensured that ships “could reach the port normally”. General Motors Co. and Volkswagen AG stated that their factories in Shanghai were operating normally.

Omicron sub-variant

The new Omicron BA.2 minor variant is widely blamed for the increase in cases in China this month. By far the worst affected area was Jilin Province in the northeast. Only two deaths have been reported, bringing the total since the start of the pandemic to 4,638. The relatively low death toll and the number of cases have been touted by the ruling Communist Party as proof of the wisdom of its approach to zero COVID-19. People line up at a COVID-19 test site outside a Shanghai hospital on Tuesday. (Aly Song / Reuters)
Outside of mainland China, new cases have dropped in Hong Kong following a recent wave that killed more than 7,000 people. The semi-autonomous city of 7.4 million recorded 7,596 new cases in the last 24 hours. Shanghai recorded 4,477 new cases on Monday, all but 96 asymptomatic. Gyms and exhibition centers have been transformed into extensive centers for the isolation of positive cases as part of the zero COVID-19 approach.

Buy panic

The measures that restrict the residents of Pudong to their homes, close non-core businesses and require mass tests are to be lifted on Friday. At that time, the huge Puxi area across the Huangpu River will be locked. Shops in Puxi along the Nanjing Road pedestrian shopping street were mostly closed on Tuesdays, with few people outside and around. The restaurants only offered package service and a long queue formed outside a McDonalds from people waiting to receive their orders. Authorities are working to secure food supplies following Sunday’s panic shopping and reports of meat and vegetable shortages. A shopper searches the mostly empty shelves at a supermarket in Shanghai on Tuesday. (Hector Retamal / AFP / Getty Images)
The lockdown in Shanghai is set to become the largest of any city in China’s anti-virus campaign, in which millions have been confined to their homes for weeks at a time in cities across much of the country. Government officials in hazmat suits, along with about 68,000 volunteers, have set up checkpoints around homes that are fenced off with plastic traffic dividers and makeshift barriers.

“I do not know how much longer we will endure”

In addition to the two-phase approach, authorities have also given specific expiration dates for lockdowns in Shanghai, unlike other cities earlier. Financial services company Macquarie Group said the lockdown in Shanghai shows that China will stick to its zero-COVID-19 strategy at least until the ruling Communist Party convenes once every five years this fall. Authorities have promoted the need for stability in the run-up to the event, when Xi Jinping is expected to take a third five-year term as party leader in a break with recent practice. China boasts a vaccination rate of about 87 percent, but the rate is much lower among the elderly, who are more vulnerable to the virus. The Macquarie Group said in a report that China should be able to curb the virus in the coming weeks, given the effectiveness of the restrictions. The legendary Bund coastal area of ​​Shanghai looks almost empty on Tuesday. (Chen Si / The Associated Press)
“But COVID does pose a significant downside risk for the rest of this year, as lockdown is also very costly,” the report said, noting that consumer businesses and the real estate sector were going to be hit hardest. Wang Hui, who runs a store near the Bund, said high rents and a lack of customers could cost him his business. “I do not know how much longer we can endure,” Wang said.