Local authorities deliver food and necessities to residents in Shanghai on April 3, 2022. Photo: Xinhua

China sent 2,000 military medical personnel to support a citywide testing scheme in Shanghai on Sunday evening after the number of infections in the city continued to rise.

More than 10,000 healthcare workers from other cities also arrived in Shanghai as all 26 million residents in the financial hub were required to undergo a PCR test within 36 hours, starting from Monday.

After dozens of Covid-19 cases were reported in Suzhou, a technology hub near Shanghai, at least 10 Taiwanese technology firms in Suzhou’s Kushan were reportedly ordered to shut down between Saturday and Tuesday.

A new subtype of Covid-19 variant, evolved from Omicron’s BA.1.1 Omicron, has been identified in Suzhou’s Changshu county, causing the local government to lock down some high-risk districts.

Meanwhile, the number of infections continued to rise in Shanghai in March and had not stabilized over the past weekend.

When Shanghai reported four cases and 34 asymptomatic infections on March 14, it did not follow Shenzhen and lock down the entire city. On March 27, Shanghai recorded 50 new cases and 3,450 asymptomatic infections, forcing the municipal government to lock down the eastern side of the city between March 28 and April 1 and the western side from April 1 to April 5.

However, the lockdown has since been extended. On Sunday, the financial hub reported 425 new cases and 8,581 asymptomatic infections, compared with 438 new cases and 7,788 asymptomatic infections on Saturday.

China’s Vice-Premier Sun Chunlan went to Shanghai for an inspection tour on Saturday. She called for resolute and swift action to stop the virus from spreading in the city, while the principle of China’s “zero Covid” policy should not be shaken, she said.

A Xinhua report said Sun’s Shanghai visit was aimed at fulfilling Chinese President Xi Jinping’s important order and implementing Chinese Premier Li Keqiang’s request to control the virus.

Local authorities deliver rapid test kits to a resident in Shanghai on April 3, 2022. Photo: Xinhua

Military mobilization

On Sunday evening, the People’s Liberation Army dispatched more than 2,000 medical staff to Shanghai in the fight against the highly contagious Omicron variant. The medical staff were drawn from seven medical units affiliated with the army, navy and joint logistics support force.

The military medics, along with more than 10,000 medical staff from Jiangsu, Zhejiang, Anhui, Jiangxi and Hubei provinces, as well as Tianjin city, will help implement a citywide Covid testing scheme in Shanghai within 36 hours from Monday.

As of Sunday, Shanghai had arranged 10 public hospitals to handle Covid patients and transformed some public facilities, including the Shanghai World Expo Exhibition and Convention Center, into quarantine camps.

Wu Qianyu, an inspector from the Shanghai Municipal Health Commission, said hospitals in nearby cities had already prepared to receive Covid patients from Shanghai.

Chen Erzhen, the vice-president of Ruijin Hospital and head of Shanghai’s central quarantine treatment team, said if there were too many asymptomatic patients, home quarantine should be considered.

Chen said most infections in Shanghai were asymptomatic as the city had a high vaccination rate, while most symptomatic patients had been identified during routine screening previously.

Meanwhile, the lockdowns are starting to take an economic toll.

According to mainland news reports, most financial institutions and companies in Shanghai have arranged for their staff to work and stay overnight at offices or factories since March 28 in order to maintain normal operations and avoid infections. But although production lines keep running, shipments have slowed.

Logistics at Shanghai Port, the world’s largest container port, have been affected by the city’s lockdown measures as drivers from nearby cities avoid entering its “closed-loop” bubble, China News Weekly reported on Sunday. A worker surnamed Lin was quoted as saying the Shanghai port was “semi-paralyzed” due to a lack of container truck drivers.

Due to virus outbreaks and lockdowns in many Chinese cities, China’s Caixin manufacturing purchasing managers’ index (PMI) fell to 48.1 in March from 50.4 in February, marking the steepest contraction in two years. A PMI figure below 50 indicates a contraction of industrial activities.

China’s official manufacturing PMI fell to 49.5 in March from 50.2 in February, the National Bureau of Statistics (NBS) said last Thursday. The figure was lower than Bloomberg’s median forecast of 49.8.

The non-manufacturing PMI eased to 48.4 from 51.6 for the same period. The last time both PMI indexes dropped below the 50-point mark was in February 2020 when virus outbreaks were first reported in Wuhan, in Hubei province.

A healthcare worker wears full protection gear in Shanghai on March 13, 2022. Photo: Xinhua

Disrupted logistics

The NBS said some surveyed companies reported insufficient personnel, disrupted logistics and transportation plus delayed deliveries due to the Covid-19 outbreak.

“The Covid-19 resurgence has a large impact on the supply chain, but it seems that its impact on production has not been fully felt due to factors such as inventory,” said Zheng Yuchi, the chief macro analyst at China International Capital Corp.

Rising raw material prices caused by the Russia-Ukraine conflict, as well as China’s virus outbreaks, would further squeeze profit margins of Chinese enterprises, particularly the small ones, Zheng said.

“If the impact of Covid-19 is further prolonged and logistics and transportation continue to be disrupted, there may be a further negative impact on China’s industrial production,” he said. “We believe that the government will further loosen its fiscal and monetary policies to support the service sector that has been hit hard by Covid-19.”

Meanwhile, the new Omicron subtype, which does not match any other coronavirus recorded globally, was identified in Changshu county on March 28, health authorities there said Saturday.

“This means a new variant of Omicron has been discovered locally,” Zhang Jun, deputy director of the Suzhou Centre for Disease Control and Prevention, said in a Xinhua report. State media said the discovery posed new threats to the already dangerous situation in the East China region.

Read: Shanghai lockdown aims to avoid HK’s death spiral

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