2022 ended in an abrupt fast-track reopening. In one month, China dropped most of its Covid-related restrictions, vowed to support the housing market more, and set pro-growth policies. We expect the Chinese economy to be separated from the global slowdown in 2023, accelerating from a low base.
The refined zero-Covid policy (with 20 measures) introduced on 12 November was initially envisioned by the leadership as an effective tool to balance growth and the Covid outbreak. However, with the highly infectious Omicron variants, the virus quickly spread and cases continued to rise across the country despite these measures. Meanwhile, localities were confused on how to implement new policies. Most of them opted to tighten the restrictions, in order to flatten the infection curve. Economic activity stayed depressed, and social unrest increased amid poorly-executed Covid policies. After the refined zero-Covid policy proved to be ineffective in containing the outbreak, China chose to embark on a fast-track reopening instead of reverting to hard-core lockdowns. Since late November, the country has removed testing requirements for most travel, allowed home quarantines for positive cases, and introduced the second booster for the senior population.
You can now read the full whitepaper at the link below