Virus epidemic rocks China’s political elite

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Online anger shakes Xi’s government as the lockdown continues and business grinds to a halt in major cities

By Gordon Watts –  Asia Times

Deserted streets, eerily quiet shopping malls and empty buses. For most people, this evokes images of quarantined Wuhan, the epicenter of the coronavirus outbreak.

But, in fact, this is Beijing, home to the ruling Communist Party elite, the Great Hall of the People and the iconic yet infamous Tiananmen Square.

“It is a ghost city, hardly any people out and very few vehicles. Six buses passed me today and, with the exception of the drivers, they were all empty. During a visit to the supermarket, I was the only customer,” a former colleague told Asia Times at the weekend, echoing similar reports.

By the numbers, Beijing is 1,055 kilometers, or 655 miles, away from Wuhan. Yet there have been more than 300 confirmed cases of the virus while two people have died.

Overall, the death toll in China has jumped to more than 900 with at least 40,0000 people infected by the 2019-nCoV disease.

Comparisons have naturally been made with Severe Acute Respiratory Syndrome, or SARS, which killed nearly 650 people across mainland China and Hong Kong between 2002 and 2003 with its flu-like symptoms.

“Neither Beijing nor Shanghai are officially under lockdown, but Beijing, to all intents and purposes is, with many people confined to their homes and working remotely,” Chris Taylor, an associate partner with the Access Asia Group, a risk-management firm based in Singapore, told Asia Times.

“In the meantime, major economic powerhouses such as Guangzhou and Shenzhen are under official lockdowns. Other cities – Kunming, capital of Yunnan Province is one example – have taken matters into their own hands and shut down almost all businesses,” he said.

“Yunnan is a major tourist draw, but I’ve been told by residents that only cars with local number plates can enter popular attractions in Dali and Lijiang, and that all tourism businesses have been shut with no word as to when they will reopen,” Taylor, who has been writing about China, Japan and Southeast Asia since 1988, added.

As the epidemic escalated last month in Wuhan, the capital of Hubei province came under siege and then lockdown. The sprawling metropolis is home to 11 million people, nearly two million more than New York or London.

President Xi Jinping’s government has also sealed off at least 15 other cities. Up to 56 million people, which is nearly the population of South Africa, have been put into quarantine after a travel ban was imposed. Yet transparency issues have bubbled just beneath the surface.

“The government failed to respond effectively,” Yanzhong Huang, a senior fellow for global health at the Council on Foreign Relations, a New York-based think, said. “Both the Wuhan and the central health authorities could have done much more to stem the spread of this virus.”

Since then, anger has boiled over on China’s social media against Xi’s administration, illustrated by the unprecedented response to the death of whistleblower Li Wenliang on February 7.

The ophthalmologist tried to raise the alarm about the spread of the outbreak before being silenced by Communist Party officials. Last week, he became another victim of the virus after his voice was finally heard.

In turn, this fuelled an online backlash and demands for freedom of speech before Beijing’s legions of censors moved in to try to eradicate dissent.

“His death sparked what was [and is] undoubtedly the most viral wave of grief and anger with the government that Chinese social media has seen. Uncorroborated numbers of 800 million posts about Li have been bandied around with allegedly billions of views. Hashtags such as ‘We want freedom of speech’ and ‘We know the government lies’ went viral, presenting Beijing with an unprecedented crisis because the sheer volume of protest was too vast to quell,” Taylor, of Access Asia Group, told Asia Times.

“Chinese netizens, including at least one I spoke to via a phone call in Beijing, said the only thing to compare it to was the death of Nobel Peace Prize winner Liu Xiaobo. But Li is an entirely different case, a hero in death who was not politically motivated, only professionally motivated to warn his fellow doctors and the public about a highly infectious virus. How the Chinese government handles this unique situation remains to be seen, but its credibility has taken a nationwide blow unlike any other in recent history,” Taylor said.

As well as the political fallout, the epidemic will have a seismic effect on the economy. Major multination companies look certain to be hit hard with supply chains already starting to show distinct signs of stress.

  • Leading carriers such as Air Canada, Air France-KLM, Air India, American Airlines, British Airways, Delta, Finnair, Lufthansa, United Airlines and Virgin Atlantic have canceled all flights to China. Hong Kong’s Cathay Pacific last week asked its workforce of 27,000 to take three weeks of unpaid leave.
  • Globe auto companies such as Renault, Honda, Toyota, Tesla, and Volkswagen have either curtailed production or shut factories in the country until later this month.
  • Food and beverage giants Starbucks, McDonald’s, KFC and Pizza Hut have closed down outlets in China.
  • Retail brands including Adidas, GAP, H&M, Levi Strauss, Nike and Old Navy have followed suit as well as luxury fashion labels such as Burberry.
  • High-tech group Foxconn, which makes iPhones and now face masks, hopes to resume production in the days ahead, but most Apple stores are still shut. Amazon, Google and Microsoft and Amazon have placed travel restrictions to and from the country.
  • In China, entertainment venues such as Shanghai Disney Resort and the country’s 70,000 movie theaters have been closed, crushing a US$9.2 billion box-office market, the second-largest in the world.

Hard figures, of course, are even harder to predict but analysts have speculated on China taking a 1% to 2% hit in GDP growth this year, eating into previous forecasts of 6%. Still, that does not factor in the great unknown of how long it will take to bring the disease under control? Probably, a $1 trillion question.

“Fear itself can shock global growth … The coronavirus creates great fear. Given the lack of relevant precedents, economic forecasting scenarios have little tangible basis,” James Sweeney and Wenzhe Zhao, of Swiss bank Credit Suisse, wrote in a brief last week.

“We expect that the nascent global growth rebound from late last year is already over. The mildest scenario for the impact on global growth we can conjure is a temporary shock to Chinese growth; the most severe echoes historical pandemics,” they added.

Initial portents from the country’s immense city landscapes are still cast in shadows. Like Beijing, it appears the only thing moving at street-level is the specter of a silent enemy, the virus itself.

 

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