China’s global hubs are becoming less global as Covid isolation takes hold
China’s global hubs are becoming less global as Covid isolation takes hold

China’s global hubs are becoming less global as Covid isolation takes hold

Editor’s note: A version of this story appeared in CNN’s Meanwhile in China newsletter, an update three times a week that explores what you need to know about the country’s progress and how it is affecting the world. Sign up here.

Hong Kong

The glittering skylines of Hong Kong and Shanghai have long been associated with richness and glamor.

But in recent weeks, they have become synonymous with a much harsher reality as authorities in the two international financial centers struggle to curb furious Omicron outbursts.

Extreme Covid measures have severely curtailed the lives of residents in both cities, with Shanghai now entering its third week of government-mandated closure and Hong Kong gnawing during a third year of quarantine and travel curbs.

Once China’s gates to the West, harsh border closures and suspended air routes have closed the two cities to large parts of the world, even as other hubs open up.

On Tuesday, only a single flight arrived in Hong Kong outside Asia and the Pacific – a stark contrast to the pre-pandemic era, when the city’s airport was one of the busiest in the world and regularly hosted 1,100 passenger and cargo flights daily to and from 200 international destinations.

Now, most of the traffic is outbound, transporting residents fleeing Hong Kong to get greener pastures with fewer restrictions. In February and March, more than 180,000 people left the city, while only about 39,000 entered, according to immigration data.

Shanghai, like Hong Kong, is home to a large number of foreign residents – but fears are growing, which may soon change.

Jörg Wuttke, President of the European Union Chamber of Commerce in China, estimates that China has lost about 50% of all European foreigners since the pandemic started – and he warns that there may be another emigration of families this summer when the school year ends . “I would not be surprised if another half of (the remaining) leave,” he told CNN last week.

A recent report from the UK Chamber of Commerce in China seemed to support this assessment, noting that international schools in China could see at least 40% of teachers leave before the next school year – which could cause more families to relocate.

The background to these departures is China’s adherence to an uncompromising zero-Covid policy, which relies on a combination of strict border quarantines, home locks and mass testing in an attempt to eradicate infections.

But these measures no longer seem to be sufficient compared to the latest Omicron wave. Hong Kong marched highest death rate per capita in Asia and Oceania last month as incidents rose and the virus ripped through nursing homes. Shanghai plunged into crisis shortly after, where all 25 million residents were put under mandatory home lockdown at the end of March.

Many in Shanghai have complained about being unable to access food, basic supplies and even medical care in emergencies. Reports on health workers forcing elderly residents into quarantine and on workers killing a pet corgi after its owner tested positive, rare public outrage against the government on Chinese social media.

“Shanghai is really pushing us to the corner. They do not treat us like humans at all, ”wrote a user on Weibo, China’s highly censored Twitter-like platform.

“I really can not understand. How could it be so bad? What’s going on with Shanghai?” another popular Weibo comment read.

Prior to this wave, Shanghai officials had prided themselves on their less disruptive approach to curbing outbreaks and had avoided the kind of urban-wide mass testing seen in other major Chinese cities.

Hong Kong had also once been praised as a zero-Covid success story. Although it had previously been the subject of several outbreaks, its death rate remained low until a fifth wave arrived in February. The risk of infection seemed so low that many residents – especially the elderly – did not consider vaccination a priority, leaving a large part of the city vulnerable when Omicron struck.

Now that an increasing number of residents seem to be leaving, this sense of relative security – and the status of both cities as international travel and trade capitals – seems further away than ever.

Nearly empty roads in Shanghai during a city-wide roadblock on April 21.

“We’ve been going over a month without making any money as a business,” said Josh Vaughn, an American entrepreneur in Shanghai who owns an online sunglasses brand. “It makes me stressful to think about it because I do not know when this shutdown will end … I’m so scared this could be the end of my business.”

Vaughn said that after incurring Covid this month, he faced hostility from his neighbors, who were reluctant to let him return to his apartment building after he was discharged from the hospital – repeating similar experiences from other expatriates. who has felt excluded.

Wuttke, President of the European Union Chamber of Commerce, warned that the economic impact of China’s Covid restrictions could pressure some foreign companies to consider moving regional headquarters out of greater China – questioning the future of major business hubs such as Shanghai and Hong Kong as the rest of the world opens up.

Singapore, as for years has competed with Hong Kong for the title of Asia’s Best International Business Center, was the first Asian country to declare that it was moving away from a zero-covid policy to live with the virus last year. Some in Hong Kong’s business sector are now keeping an eye on the Southeast Asian city-state, which rose all quarantine requirements for vaccinated travelers in April.

Chinese authorities have acknowledged this precarious position, with Hong Kong leader Carrie Lam saying in late March: “I have a very strong sense that people’s tolerance is disappearing … that some of our financial institutions are losing patience with this kind of isolation. status of Hong Kong, as Hong Kong is an international financial center. ”

In an effort to bolster Hong Kong’s declining economy, Lam lifted some flight bans and shortened quarantine requirements last month. But it may be too little, too late – especially as Chinese officials and state media increase the rhetoric praising China’s zero-Covid policy and give little hope that these international financial centers will open up anytime soon.

Gabriele, an Italian resident of Shanghai who asked to be identified only by his first name, tested positive in early April and has since been detained in his apartment for more than three weeks, he said.

Gabriele described the situation as a “nightmare” and said health workers said they would come to test him again but “never showed up” and attempts to contact local authorities have gone nowhere. “We feel helpless,” he said.

Now he is considering moving home forever – leaving a city he once loved. “The city completely lost its luster. I do not know if it will recover, he said. “It’s like a whole other city … it really feels like we’re going back in time instead of looking to the future.”

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