Shanghai lockdown snarls world's busiest port and China supply chains

BEIJING — Shanghai's grinding coronavirus lockdown is slowly clogging China's supply chains, as delays hit the world's busiest container port where staff are tangled in a morass of COVID controls.

Beijing has refused to tack away from its strict zero-COVID strategy that has protected its public health system through the pandemic but at a mounting economic cost.

China's financial hub Shanghai -- home to multinational firms and its busiest port -- has been sealed off almost entirely for a week following an outbreak fueled by the Omicron virus variant.

That has many forced companies to halt production and slow new projects, factories told AFP, while those still operating are struggling with a shortage of truck drivers on top of onerous permit and COVID testing requirements.

At Shanghai's port, the lack of drivers and other workers means getting goods in and out is increasingly hard.

The docks are working normally with a "single-digit" number of vessels waiting to berth, Shanghai International Port Group said this week.

"But the fact is... due to restrictions caused for truck drivers, it is not really operating," Bettina Schoen-Behanzin, vice president of the EU Chamber of Commerce's Shanghai Chapter, told AFP.

"The figure I heard is that... week-on-week volumes at the Shanghai port are down by 40 percent. So that's really enormous."

Shortages are starting to bite across China's vast consumer economy, where online shopping platforms such as Taobao face delivery delays, especially of imported goods.

COVID curbs in a number of cities have forced factories to find new suppliers.

But the impact may soon also be felt outside China if lockdowns persist.

Shanghai is the world's number 1 container port, a spinal point in the global supply chain and a key gateway for foreign trade.

It handles around 17 percent of China's total port volume and shipped 47 million TEU -- the standard measurement for cargo, meaning Twenty-foot Equivalent Unit -- in 2021.

FACTORIES CAN'T WORK FROM HOME

Chinese manufacturers say lockdowns, no matter how flexible or targeted, pile pressure on their business.

"Not many roles allow working from home," said Jason Lee, founder of wheelchair producer Megalicht Tech, whose factory in Shanghai's Puxi area has suspended production.

"People can't enter the factory... and because our raw materials come from other provinces or cities, these can't enter Shanghai either," he said.

A Shanghai-based clothing exporter surnamed Zheng said his biggest problem was that he could not send samples to clients.

"Deliveries can neither leave nor enter," he said

Experts say the outbreak is currently nibbling at growth, but could soon take a big bite.

Nomura economists estimate that 23 cities accounting for 22 percent of China's GDP have rolled out full or partial lockdowns.

"The costs of the zero-COVID strategy will rise significantly as its benefits decline, especially as exports are hit by the ongoing lockdowns," Nomura chief China economist Lu Ting told AFP.

That will challenge Beijing's 2022 GDP growth target of around 5.5 percent, he added.

ADAPTING TO SURVIVE

For now, companies are adapting to try and handle the restrictions.

"Our main business activity is down by over 50 percent," said Gao Yongkang, general manager of Qifeng Technology in eastern China's Quanzhou city.

The company has been unable to transport textile materials to regular clients because of the COVID curbs, and has instead pivoted to supplying the booming market for protective gear.

Meanwhile, those who cannot reach their original suppliers are scouring for new ones.

"The costs are a little higher and it's slightly less efficient but we can fulfill our regular needs," said Shen Shengyuan, deputy general manager of diaper-producer New Yifa Group.

In a nod to struggling industries, Premier Li Keqiang this week announced a temporary deferment of old-age insurance premiums for sectors such as catering, retail and civil aviation.

But industry groups say hard lockdowns on major cities such as Shanghai are unsustainable, especially with many Omicron cases presenting light or no symptoms.

"Does the zero-COVID strategy still work in the current environment," said Eric Zheng, American Chamber of Commerce president in Shanghai. 

"That's a big question, particularly when you try to balance the economic cost."

Agence France-Presse

Vietnam expands lockdown measures as COVID-19 infections hit record

HANOI - Vietnam widened lockdown measures in its industrialized north on Tuesday to combat its biggest COVID-19 outbreak so far, as authorities reported a daily record in new cases that was more than double the previous high.

The health ministry announced 457 new COVID-19 infections on Tuesday, the biggest jump since the 190 cases seen on May 16, driven by clusters in factory zones in two northern provinces.

Bac Ninh, home to production facilities of Samsung Electronics, started a curfew and other travel restrictions from Tuesday, state media reported.

That followed the temporary closure of four industrial parks, including three with Foxconn facilities, by authorities in neighboring Bac Giang province.

The outbreak could be a big challenge for Vietnam, which successfully contained earlier, smaller outbreaks and avoided the level of economic damage suffered by many of its neighbours.

Bac Ninh and Bac Giang are the epicenter of the new outbreak that has infected more than 2,800 people since late April, including hundreds of factory workers.

Authorities say the outbreak, which accounts for nearly half of Vietnam's overall cases, has spread to more than 30 of its 63 cities and provinces.

The capital Hanoi on Tuesday shut down restaurants and banned gatherings at public areas, including physical exercises in parks. Hanoi has recorded 220 cases since late April.

Most of cases on Tuesday were at factories in Bac Giang, where authorities said testing had been ramped up and all workers' dormitories put in isolation.

Vietnam has reported at least 5,860 infections in total, with 44 deaths.

It has yet to start mass inoculations against the coronavirus, with about 1 million doses of vaccines administered so far, mainly to frontline workers. 

-reuters

Germany extends virus shutdown until March 7

BERLIN - Chancellor Angela Merkel's government agreed Wednesday to continue a partial lockdown to fight the coronavirus pandemic until at least March 7, even as Germans grow increasingly weary of the tough restrictions.

Following crunch talks with the leaders of Germany's 16 states, Merkel said that the number of new Covid-19 infections in Europe's top economy was dropping after more than two months of shuttered schools and shops.

"When we look at this development we can be quite satisfied," she told reporters. 

But she called on Germans to be patient as fears grow over more contagious virus variants first detected in Britain and South Africa.

"We want to do everything in our power so that we don't end up riding an up-and-down wave of openings and closures," Merkel said, calling the period until mid-March "existential" for Germany's management of the pandemic. 

The new strains "are spreading especially quickly and require significant additional efforts", the government said in conclusions agreed at the meeting.

EXPONENTIAL GROWTH

Under Germany's federal system, regional states have significant decision-making powers and some have strayed from the government line in the past to loosen some restrictions.

The text stresses that schools and daycare centers should be "the first to gradually reopen", but that it is for individual states to decide how and when.

After the announcement, Berlin Mayor Michael Mueller said the capital would begin partially reopening schools from February 22, with other regions expected to follow suit.

The conclusions call on Health Minister Jens Spahn to review whether nursery workers and teachers can be given higher priority in vaccinations. 

Hairdressers may reopen on March 1 if they take the necessary hygiene precautions.

The conclusions also raise the prospect of museums, galleries and some services restarting once the virus incidence rate falls to 35 new cases per 100,000 residents over a seven-day period.

The government had earlier set an incidence target of 50 but revised it downward due to the threat of what Merkel called "exponential growth" posed by the more contagious virus mutations. 

With an eye to an outbreak of the South African variant in the Austrian region of Tyrol bordering Germany's Bavaria state, Merkel said she had conveyed her "concern" to Austrian Chancellor Sebastian Kurz on Wednesday.

SCIENCE-BASED MANAGEMENT

Germany closed restaurants, hotels, culture and leisure centers in November, followed by schools and non-essential shops in December. The measures were later extended until February 14.

Since then, new Covid-19 cases have dropped considerably and the seven-day incidence rate has fallen below 75 for the first time since November.

The figure is currently at 68, down from 111 at the last such meeting on January 28, Merkel said. 

But Covid-19 deaths remain troublingly high, and hospitals say they are still close to capacity.

Germany on Wednesday added another 8,072 coronavirus cases to the official figures, bringing the total to just under 2.3 million. 

Almost 63,000 people have died of the virus, according to the Robert Koch Institute for disease control.

Although a majority of Germans still back Merkel's science-based management of the crisis, fatigue is setting in after three long months of restrictions and amid a sluggish vaccine rollout.

A YouGov poll this week showed that just half of Germans want the current measures to be maintained or tightened, down from 65 percent in early January.

Merkel said she and state leaders would convene again on March 3 to fine-tune the restrictions based on the latest data.

Agence France-Presse

Australia to shut state border as Melbourne infections surge

MELBOURNE, Australia (AP) — Australian authorities were preparing to close the border between the country’s two largest states, as the country’s second-largest city, Melbourne, recorded two deaths and its highest-ever daily increase in infections on Monday.

The border between the states of New South Wales — home to Sydney — and Victoria — home to Melbourne — is due to be shut late Tuesday.

New South Wales Premier Gladys Berejiklian was a critic of states that closed their borders to her state when Sydney had Australia’s largest number of coronavirus cases. But she said she changed her stance because the situation in Melbourne was unprecedented and indicated the pandemic was in a new phase.

The overwhelming majority of new infections detected in Melbourne in recent weeks were from community transmission. Everywhere else in Australia, the vast majority of people who tested positive for the virus were infected overseas or had been infected by a returned traveler, Berejiklian said.

“What is occurring in Victoria has not yet occurred anywhere else in Australia,” she said Monday. “It’s a new part of the pandemic and, as such, it requires a new type of response.”

The Victorian government locked down 36 of the most virus-prone Melbourne suburbs last week and at the weekend added another four suburbs because of the disease spread.

Victorian Premier Daniel Andrews said of the 127 new cases recorded overnight, 53 were among 3,000 people who have been confined by police to their apartments in nine public housing blocks since Saturday.

Australia’s Acting Chief Medical Officer Paulk Kelly has described the high-rises as “vertical cruise ships” because of the high risk of virus spread.

Police allege a 32-year-old man bit a police officer on Monday as he attempted to leave a high-rise in the suburb of Flemington. He would be charged with assault, resisting police and attempting to breach a pandemic order, Police Chief Commissioner Shane Patton said.

The infections announced Monday surpassed the first surge of infections in Melbourne that peaked on March 28 at 111 cases recorded in a day.

Daniels said he agreed with Berejiklian and Prime Minister Scott Morrison, a Sydney resident, that the border needed to close. Three in five Australian residents live in Sydney or Melbourne and the air services between the two cities before the pandemic were among the busiest in the world.

“I think it is the smart call, the right call at this time, given the significant challenges we face in containing this virus,” Andrews said.

Deputy Chief Medical Officer Michael Kidd confirmed that federal authorities agreed with the closure. The federal government had previously opposed any internal border closures aimed mostly at stopping spread from Victoria and New South Wales. Morrison had urged state leaders to open their borders for the good of the economy.

Kidd said that only 16% of new cases detected in Australia in the past week had been infected overseas. Two weeks ago, 50% of new cases were people infected overseas and detected in hotel quarantine, he said.

“The situation in Melbourne has come as a jolt, not just of the people of Melbourne but people right across Australia who may have thought that this was all behind us. It is not,” Kidd said.

Outside of Victoria, another 13 cases reported in the past 24 hours were people infected overseas. Of those, 10 had been in hotel quarantine in New South Wales and three in Western Australia

New South Wales police will enforce the Victorian border closure. Some flights and trains services would continue for travelers who are given permits and exemptions, Berejiklian said.

New South Wales Police Commissioner Mick Fuller said officers would use drones to detect people who attempt across the border via forest tracks to avoid the 55 policed road and bridge crossings.

Nationwide, Australia has recorded more than 8,500 total infections and 106 deaths.

_____

McGuirk contributed to this report from Canberra Australia.

Associated Press

Europe steps up reopening, unveils plans for summer travel

Europe moved ahead with its emergence from coronavirus lockdown on Wednesday and laid out plans for summer tourism, but the pandemic gathered pace elsewhere.

Britain followed France, Italy and Spain in easing its lockdown but only in England, where people were given more freedom to leave their homes and return to their jobs if they cannot work remotely.

Austria said its borders with Germany would reopen from mid-June and Berlin said it aimed to end virus checks at its land borders in about a month.

Desperate to save millions of tourism jobs, the European Union set out plans for a phased restart of travel this summer, with EU border controls eventually lifted and measures to minimise the risks of infection, like wearing face masks on shared transport.

"Today's guidance can be the chance of a better season for the many Europeans whose livelihood depends on tourism and, of course, for those who would like to travel this summer," EU Commission executive vice president Margrethe Vestager told reporters.

- Second wave fears -

But with the global death toll from the coronavirus exceeding 292,000, the picture was grim in other parts of the world.

Russia, now the country with the second-highest number of virus cases, recorded more than 10,000 new infections after authorities this week eased restrictions to allow some people back to work.

Brazil registered its highest virus death toll in a single day, with 881 new fatalities bringing the total to 12,400, and the country was emerging as a new global hotspot despite President Jair Bolsonaro dismissing the pandemic as a "little flu".

Fears were growing of a second wave of infections in China, with the northeastern city of Jilin put in partial lockdown and Wuhan, where the virus was first reported last year, planning to test its entire population after clusters of new cases.

- 'Risk of uncontrollable outbreak' -

And the United States, which has confirmed more than 1.36 million cases, saw a sharp rise in fatalities, with 1,894 new deaths reported on Tuesday after daily tolls fell below 1,000.

The country's top infectious diseases expert Anthony Fauci issued a stark warning about the dangers of resuming normal life too soon, saying a run of 14 days with falling cases was a vital first step.

"If a community or a state or region doesn't go by those guidelines and reopens... the consequences could be really serious," he said Tuesday.


"There is a real risk that you will trigger an outbreak that you may not be able to control."

Fauci said the true number killed by the epidemic in the US is likely greater than the official toll of over 82,000 -- the world's highest.

Facing a re-election campaign later this year, President Donald Trump is pressing for rapid steps to get the US economy moving again, despite warnings from health officials.

Washington has increasingly blamed China for the global outbreak and on Wednesday authorities warned healthcare and scientific researchers that Chinese-backed hackers were attempting to steal research and intellectual property related to treatments and vaccines for the coronavirus.

"China's efforts to target these sectors pose a significant threat to our nation's response to COVID-19," a statement from the FBI and the Cybersecurity and Infrastructure Security Agency said.

- Moves to reboot economies -

Countries around the world are grappling with how to reopen businesses after the pandemic forced half of the planet into some form of lockdown and ground the global economy to a near-halt.


Dire economic data from March and April have pointed to the worst downturn since the Great Depression of the 1930s after millions of people were thrown out of work.

Figures from Britain on Wednesday showed its economy shrinking by two percent in January-March, its fastest slump since 2008 and with a far worse contraction to come.

The Bank of England last week warned that the economic paralysis could lead to Britain's worst recession in centuries, with output forecast to crash 14 percent this year.

Federal Reserve Chair Jerome Powell said shutdowns in the United States would do "lasting damage" but "the economy should substantially recover once the virus is under control".

He said crisis measures, including spending beyond the nearly $3 trillion already approved in the United States, would be crucial to ensuring a strong recovery.

Health experts have warned of the potentially devastating consequences as the virus spreads through the developing world, where healthcare systems are under-funded and isolation regimes are often not possible.

- 'Tough old lady' -

In northern Nigeria, surging death tolls have sparked fears that the virus is spreading, with a team of government investigators saying hundreds of deaths were suspected to be linked to the pandemic.

Making the problem worse, hospitals have shut their doors to the sick out of fears over the virus -- meaning treatment for a raft of ailments has stopped.

Civil servant Binta Mohammed said she had to watch her husband die from "diabetic complications" after he was turned away for treatment.

"The four private hospitals we took him to refused to admit him for fear he had the virus," she said.

But there were stories of hope amid the gloom, including two centenarians who survived the virus.

In Spain, 113-year-old Maria Branyas fought off the illness during weeks of isolation at a retirement home where several other residents died from the disease.

And in Russia, 100-year-old Pelageya Poyarkova was discharged from a Moscow hospital after having recovered.

Russian television showed Poyarkova wearing a face mask and clutching a bouquet of red roses as she exited in a wheelchair, surrounded by doctors and journalists.

"She turned out to be a tough old lady," the hospital's acting director Vsevolod Belousov said.

burs-mm/jv

Agence France-Presse

South Korea leads virus success in Asia as drug trial raises hope

South Korea, once one of the hardest-hit countries in the coronavirus pandemic, reported no new cases on Thursday, boosting hopes of an eventual return to normality as US scientists hailed the results of a major drug trial.

The good medical news caused equities to rally, despite mounting deaths worldwide and abysmal economic figures caused by the COVID-19 crisis.

Data showed the pandemic, which has killed more than 224,000 people, has plunged the United States into its worst economic slump in a decade, and has left Germany expecting its biggest recession since the aftermath of World War II.

But for the first time since the new disease was detected there in mid-February, South Korea reported zero new infections.

The East Asian nation had the world's second-largest coronavirus outbreak for a period after the virus emerged in China late last year.

But with an aggressive test-and-trace strategy and widespread social distancing, it has managed to bring the spread of the pathogen under control.

"This is the strength of South Korea and its people," said President Moon Jae-in as he announced the milestone.

Meanwhile in the first proof of successful treatment, a clinical trial of the drug remdesivir showed that patients recovered about 30 percent faster than those on a placebo.

"The data shows that remdesivir has a clear-cut, significant, positive effect in diminishing the time to recovery," said Anthony Fauci, the top US epidemiologist.

- Hope in Asia -

South Korea's virus death toll is around 250 -- vastly lower than that of Italy, Britain, Spain and France, which have each recorded more than 24,000 fatalities, and the United States, topping the table with a third of global deaths.

Other parts of the region have seen similar success in their fight against the virus.

Infections have dwindled in China after it imposed extremely strict lockdown measures on millions of people earlier this year. Its official toll is around 4,600, although doubt has been cast on the figures' accuracy.

Hong Kong, a city of seven million where there have been just four virus deaths, reported no new cases for the fifth straight day on Thursday.

And New Zealand has declared the battle won against widespread, undetected community transmission.

However the economic costs are beginning to mount, raising fears of an era-defining global crash and increasing pressure worldwide to ease lockdowns despite fears of a second wave of contagion.

- Recession warning -

The US announced that economic output collapsed 4.8 percent in the first quarter -- ending more than a decade of expansion.

On Thursday, France and Spain both said their economies had fared even worse, contracting 5.8 percent and 5.2 percent respectively, while the Eurozone economy as a whole also shrank.

Federal Reserve chairman Jerome Powell warned worse was to come, and economic activity will likely drop "at an unprecedented rate" in the second quarter.

Germany, Europe's largest economy, has succeeded in holding off the devastating death tolls seen elsewhere, but is still bracing for an overwhelming economic hit.

Germany "will experience the worst recession in the history of the federal republic" founded in 1949, Economy Minister Peter Altmaier warned, predicting that GDP would shrink by a record 6.3 percent.

The International Labour Organization said half the global workforce -- around 1.6 billion people -- are in "immediate danger of having their livelihoods destroyed".

One of the worst-hit sectors is the aviation industry, but an unprecedented drop in demand for fossil fuels means global energy emissions are expected to fall a record eight percent this year, the International Energy Agency said.

- Drug trial -

Experts have warned that only a vaccine will allow the full removal of restrictions that this year put half of humanity under some form of lockdown.

But there have been encouraging signs in the search for a treatment.

Fauci likened remdesivir to the first retrovirals that worked, albeit with modest success, against HIV in the 1980s.

The drug failed in trials against the Ebola virus, and a smaller study, released last week by the WHO, found limited effects among patients in the central Chinese city of Wuhan, the disease's original epicentre.

Senior WHO official Michael Ryan declined to weigh in on the latest findings, saying he had not reviewed the complete study.

"We are all hoping -- fervently hoping -- that one or more of the treatments currently under observation and under trial will result in altering clinical outcomes" and reducing deaths, he said.

While the world keeps looking for signs of progress against the pandemic, research is also revealing frightening new details about COVID-19.

Britain and France have both warned of a possible coronavirus-related syndrome emerging in children -- including abdominal pain and inflammation around the heart.

"I am taking this very seriously. We have absolutely no medical explanation at this stage," French Health Minister Olivier Veran said.

Experts have also warned of longer-term psychological tolls on both children and adults after weeks or even months in isolation.

burs-kaf/hg/axn

Agence France-Presse

Moscow begins lockdown during tougher push to curb virus

MOSCOW — Moscow, with its more than 12 million people, went into lockdown on Monday while other parts of Russia moved to introduce similar steps to curb the coronavirus outbreak.

The enforcement of the strict new rules, which Moscow Mayor Sergei Sobyanin suddenly announced late Sunday, coincided with the beginning of a "non-working" week declared by Russian President Vladimir Putin.

"The situation is certainly serious and everyone should take this very seriously," Putin's spokesman Dmitry Peskov said.

Moscow, which has become the epicentre of the contagion in Russia, announced the new measures after many Muscovites failed to heed recommendations to self-isolate and instead went to parks for barbecues at the weekend.

On Monday, Red Square in the heart of Moscow was eerily empty, while the streets of Europe's most populous city were quiet even though traffic could still be seen on the roads.

Anna, a 36-year-old web designer living in south Moscow, said the lockdown would be hard for her and her five-year-old daughter.

"But I don't want Arina to get sick," she told AFP while on her way to buy some bread. "So of course we will observe the quarantine."

But some were in no hurry to take the new rules to heart. Three teenagers flouted social distancing rules, walking and laughing together.

"Staying home with our parents will kill us quicker than the coronavirus," said one teen as the others nodded.

Regions eye lockdowns

Muscovites are now only allowed to leave their homes in cases of a medical emergency, to travel to jobs judged essential, and to go to local grocery stores and pharmacies which need to enforce social distancing.

People are also allowed to take out the trash and walk their dogs.

Over the past 24 hours Russia has recorded 302 new cases -- the biggest daily increase so far -- taking the national tally to 1,835 cases of coronavirus and nine deaths.

But the real number of infected people is believed to be higher and critics have rounded on authorities for not proposing tougher measures sooner.

At least eight regions including the Western exclave region of Kaliningrad have already imposed or were preparing to impose strict quarantines.

Chechen strongman Ramzan Kadyrov was the first regional leader to announce a lockdown last week, banning non-residents from entering the once restive region.

Masked men in black uniforms were policing streets in Chechnya armed with white clubs, according to a video published by independent newspaper Novaya Gazeta.

In a rare televised address last Wednesday, Putin announced that Russians would not be required to go to work this week, but would still get paid.

He also postponed an upcoming public vote on constitutional reforms that would allow him to stay in power until 2036.

'Pray at home'

The powerful Russian Orthodox Church, which had initially said authorities had no right to close churches, finally fell into line on Sunday, with Patriarch Kirill calling on the faithful to pray at home.

"You can be saved without going to church," he told believers in an address.

The new isolation rules, which will be policed by a vast system of facial-recognition cameras in Moscow, came into force as Russia also closed its borders.

Agence France-Presse