NEW DELHI: China's Covid troubles are far from over.First, the strict zero-Covid policy denied its huge population the hybrid immunity that most of the world relied upon.
The result- a massive surge in infections driven primarily by the Omicron variant in late 2022.
It also impacted the economy with factories closed and a slump in demands.Then, amid accusations of data manipulation, came the revelation that China's hospitals saw a staggering 60,000 Covid deaths in a month since early December.
And that could still be just a tenth of total fatalities, by some estimates.And then came the withdrawal of zero-Covid policy and easing of Covid norms, in what seemed a knee-jerk reaction to simmering anger and protests.The consequence- a whole new source of turmoil that challenges the ruling Communist Partys efforts to maintain stability amid a flagging economy and an explosion of Covid across the country.The abrupt policy shift has precipitated an unforeseen tsunami of job losses, with many firms unable to pay employers and enforcing furloughs.How easing of Covid norms killed an industryMass testing was a cornerstone of Chinas strategy of isolating the virus before it could spread.
But now, Covid testing is no longer in high demand.China's vast machinery of virus surveillance and testing collapsed once the strict zero-Covid policy was abruptly scrapped, almost overnight.Companies that manufactured test kits and analyzed results in a lab are seeing their revenues plummet, leading to lay offs and pay cuts for their workers, an article in The New York Times (NYT) said.Quoting a report, it said that mass testing in large cities accounted for as much as 1.3% of Chinas economic output.
After the slump in demand for Covid-related products and services, factories across China are still strapped for cash amid the broader slowdown.Many low-level government workers charged with enforcing Covid restrictions, have been let go, muddying an already volatile labor market.A lot of these jobs were never going to be long-term, stable employment opportunities, said Taylor Loeb, a senior economic analyst for Trivium China, a consulting firm.Protests on China's streets, before and after zero-CovidIn the southwestern Chinese city of Chongqing, hundreds of workers locked in a pay dispute with a Covid test kit manufacturer clashed with policemen in riot gear.
They kicked and tossed boxes of rapid antigen tests on to the ground, sending thousands of tests spilling.
A video uploaded on Twitter (not vefiried by TOI) claimed to show a protest by laid off workers at a plant in the city.In the eastern city of Hangzhou, witnesses said several workers climbed on the roof of a test kit factory and threatened to jump to protest unpaid furloughs.
At another factory in the city, workers protested for days over a wage dispute.A tense standoff between the police and hundreds of workers at a factory devolved into a shoving match, a video showed.
Dozens of them were taken away by the police, NYT quoted eyewitnesses as saying."Workers have next to no recourse to resolve their grievances other than to lash out," said Li Qiang, founder and executive director of China Labor Watch, a New York-based Chinese labor rights group.These protests have been very violent because the channels to defend workers rights are very limited, while the trust toward the government and laws is low, Li said.
It demonstrates that if a company ignores workers rights, especially the most vulnerable temporary workers, it will face serious consequences.How China's zero-Covid became unsustainableChinas strategy of mass testing was proving financially unsustainable.
Many local governments already under significant financial pressure from the slowdown and a dearth of land sales for real estate development struggled to pay for the millions of free swabs that residents were ordered to take virtually every day.To fund testing and other pandemic controls, money was diverted from public projects in some provinces, while cities cut bonuses for officials and imposed pay cuts on civil servants.
Several provinces and municipalities, including Guizhou in Chinas southwest, began charging for the tests.Lab testing firms that earlier reaped huge windfalls began reporting that governments were late on payments, leaving them exposed to bad debt, the article in NYT said.A fast-growing testing firm that opened six new labs across China in October, shuttered half of them in the last few weeks.
It was unclear if the closures were spurred by debt or a lack of business.