China Updates: Doubling down on the Dynamic Zero-COVID policy

The Standing Committee of the Chinese Communist Party’s Politburo  (the Standing Committee) doubled down on the Dynamic Zero-COVID policy in a meeting on May 5, 2022.  The meeting, which President Xi Jinping chaired, asserts China’s unswerving adherence to the Dynamic Zero Covid policy.  The Standing Committee commands party cadres, government officials, and community leaders at all levels to unite themselves in thinking and actions close to the centre of the Chinese Communis Party (the Party) and not to waver in pandemic control.  In the view of the Standing Committee, China’s pandemic control policy is a matter of the nature  and principle of the Party. 

Resemblance of war-time mobilization. The Standing Committee urges party cadres and government officials to speed up and extend the scope of pandemic control measures and tighten control and coordination.  It is worth to note that the remark by the Standing Committee on a prior meeting on March 17, 2022 that “more effective measures should be taken to achieve maximum effect in prevention and control with minimum cost, and to reduce the impact on socioeconomic development as much as possible” is missing this time and replaced by the bare minimum reference to “protecting people’s basic livelihood and supplies of daily necessities and their need for medical care”.  society against the Dynamic Zero Covid policy. 

The Standing Committee calls on comprehensive mobilization throughout the party, the government and the society to earnestly enforce pandemic control.  It emphasizes that it is a duty of not only party cadres and government officials but also industries, corporate and individuals to do their parts well in the war against the pandemic. Throughout the press release, the tone resembles a war time mobilisation which calls for unity, determination, and sacrifices. In other words, the economic costs and the risk of sharply lower economic growth are all secondary to the priority of the Dynamic Zero-COVID policy. 

Putting down the pushback against Dynamic Zero-COVID policy.  The Standing Committee urges party cadres and government officials to overcome “inadequate understanding, lacking preparedness, insufficient work, complacency, indifference, self-righteousness, feeling of exhaustion, tiring of fighting, leaving things to luck and sloppiness”.  It vows to fight against narratives that “distort, question, or dismiss” China’s Dynamic Zero-COVID policy.  This warning seems aiming at putting down the emergent voice of discontents from some corners of the society, including some from social elites, against the lockdowns and other stringent controlling measures. 

Stimulus initiatives are pushing on a string. Relaxation of Dynamic Zero-COVID policy is now completely off-the-table.  The Standing Committee’s decision and subsequent statement puts an end to the any emergent debate in the society or even among certain ranks and files of the government about the enormous costs of persistent and pervasive pandemic control measures.  This is going to have enormous negative impact on the economy and the financial markets.  The much talked about economic, fiscal and monetary stimulus policy initiatives, even having been rolled out, will be just pushing on a string.