11/28 05:51 ETWe’re going to pause the blog for a while. Here’s a broad catch-up on the situation in China and in markets today after protests against the country’s Covid curbs spread to multiple cities.
There were mostly peaceful protests and vigils across China over the weekend amid anger at a fatal fire in Urumqi, Xinjiang, where at least ten people died last week. Many people blame Covid barriers for delaying rescue efforts and the escape of residents.Censors are scrubbing social media of re
11/28 05:51 ETWe’re going to pause the blog for a while.
Here’s a broad catch-up on the situation in China and in markets today after protests against the country’s Covid curbs spread to multiple cities.
- There were mostly peaceful protests and vigils across China over the weekend amid anger at a fatal fire in Urumqi, Xinjiang, where at least ten people died last week.
Many people blame Covid barriers for delaying rescue efforts and the escape of residents.
- Censors are scrubbing social media of references to the protests, while TV bulletins and media have avoided covering the events.
Blank screenshots and hand-held white pages have become a symbol of protest, while CCTV appears to be cutting footage of mask-less World Cup football fans in Qatar.
- Social media posts indicate that at least some people plan to again protest or hold vigils on Monday night.
There have also been posts saying police are removing people from places associated with the demonstrations.
- The BBC has protested after one of its journalists was “beaten and kicked” by police at protests in Shanghai.
Nationalist blogger Chairman Rabbit has blamed the protests on “foreign forces”. China’s foreign ministry spokesperson later said the BBC reporter didn’t identify himself．
- The protests come as Covid cases rise in China, where officials are concerned that — without curbs — deaths could surge amid the ageing, inadequately vaccinated population.
But officials have called for sensible enforcement of rules, and Beijing banned physical barriers that block fire exits.
- China stocks dropped with the yuan, dragging down equities across Asia, on investor concern at the unrest in China.
Oil tumbled to the lowest level since December — before Russia’s invasion of Ukraine. Some investors say the protests could speed China’s exit from Covid Zero.
Adrian KennedySenior Editor, News Desk11/28 03:46 ETChinese stocks ended lower on Monday with the onshore benchmark CSI 300 Index and Hong Kong’s Hang Seng Index both down over 1% after paring some earlier losses.
The onshore yuan weakened 0.5% against the dollar, having plunged more than 1% at the open, the most since May. Two things investors are watching closely: the level of social unrest overnight and how policy makers respond to rising Covid cases.
Charlotte YangAsia Equities Team11/28 03:39 ETFollowing up on the Apple news, Bloomberg Intelligence technology analyst Steven Tseng notes Apple’s iPhone business could lose more than 300 basis points of gross margin if the company shifts production to India from China.
“Learning curves and poor infrastructure are among the hazards facing Apple as deglobalization redraws the contours of its business.”Here’s Steven’s report on Apple’s problems in China:Apple’s China Pullback Could Be Crunch Time for IPhone MarginsDouglas LytleBloomberg Intelligence Editor11/28 03:35 ETYoung women are emerging as a prominent voice of the protests, underscoring their changing role in a conservative Asian society.
They joining fellow protesters in Shanghai and Beijing, venting their anger and frustrations on local officials and the Communist Party. Several women were also observed making impassioned speeches despite the risk of possible detention.
Read more: Young Women at Front Line of China’s Sweeping Covid ProtestsRebecca Choong WilkinsAsia Government & Politics Correspondent11/28 03:34 ETIn today’s Prognosis newsletter (our health-focused daily digest), I write about the unanswered questions that are behind the protesters’ — and the world’s — discomfort with the Covid Zero policy.
Why, in a country so accustomed to top-down, coercive policies, were its elderly not made to get vaccinated at higher numbers to minimize fatalities when the virus inevitably spread? Why, from a government able to pull off the greatest economic growth story of our generation, has there not been a properly formulated exit plan from Covid Zero, after so many other places have shown that it can be done relatively safely?
Read more here: Prognosis: China’s Covid Unrest Is Raising Piercing QuestionsRachel ChangAsia Consumer & Healthcare Team Leader11/28 03:31 ETChina’s state-run Xinhua news agency on Monday published three commentaries urging officials to make “the greatest effort possible” to reduce Covid control-related inconveniences to the public, even though it didn’t mention the unrest or protests directly.
It said the authorities must address public concerns and win their “understanding, support, and cooperation” in the fight against the outbreaks. Still, Xinhua defended the Covid Zero strategy, insisting it is “science-based and effective,” while also admitting China’s control measures are facing “unprecedented pressure.”Fran WangChina Economy Team11/28 03:03 ETNews of Taiwan relaxing its mask mandate is going around on Chinese social media.
Some Weibo users referenced the one-China policy and called on Beijing to follow suit as well. Zibang XiaoReporter11/28 02:54 ETWe’ve just moved an exclusive report from Vlad Savov on how Apple’s key manufacturing hub in Zhengzhou will likely see a production shortfall of close to 6 million iPhone Pro units this year.
The conditions at the Zhengzhou plant have been terrible for months: workers have been trapped inside in a “closed loop” with no contact with the outside world. Food supply has been bad, the virus has been spreading and some weren’t being properly paid, leading to riots last week.
Apple Faces Shortfall of 6 Million IPhone Pros on China UpheavalThe Apple problem epitomizes another major negative consequence of the Covid Zero policy: China’s status as the heart of so many global supply chains is being called into question, with foreign companies no longer able to operate with certainty there.
Rachel ChangAsia Consumer & Healthcare Team Leader11/28 02:52 ETForeign ministry spokesman Zhao also said it is “absolutely unnecessary” for some people to be concerned about the safety of living in China.
Zibang XiaoReporter11/28 02:51 ETChina’s foreign ministry accused “some forces with ulterior motives” of linking the Urumqi fire to Covid restrictions. At least 10 people were reported to have died in the blaze and some citizens questioned whether Covid controls hampered rescue efforts.
Zibang XiaoReporter11/28 02:50 ETDo You Hear the People Sing? from the musical Les Misérables has been popular during these protests.The song was also widely circulated on the Chinese internet during the Shanghai lockdown in the spring to voice people’s discontent.
Zibang XiaoReporter11/28 02:41 ETHow Xi Jinping responds to the protests may end up being just as pivotal for the country’s future. Read More: Xi Has Few Good Options to End Historic China Covid ProtestsAllen WanShenzhen Bureau Chief11/28 02:28 ETThe foreign ministry said it’s “not aware” of overseas protests calling for an end to China’s Covid Zero policy and for Xi to step down.Zibang XiaoReporter11/28 02:27 ETChina Refutes Detained BBC Journalist’s ClaimsForeign ministry spokesman Zhao Lijian also said the BBC’s statement on its detained journalist doesn’t reflect what actually happened, as the journalist didn’t identify himself as a reporter.
Authorities only “ushered away” those who refuse to leave. Zibang XiaoReporter11/28 02:25 ETChina’s foreign ministry stressed that the Chinese people’s fight against Covid-19 will be successful.
Zibang XiaoReporter11/28 02:25 ETChina’s foreign ministry is holding its daily briefing now. Yanping LiBeijing Bureau Chief11/28 02:13 ETVaccines are only a part of China’s reopening calculus, according to analysis from Bloomberg economists Eric Zhu and Chang Shu.
They say:
- The vaccination rate among vulnerable groups remains low, a reason to go slow.
- Strict Covid curbs are costly for people’s livelihoods — and the protests underline discontent.
- But less visible, public concern about the health risks entailed in rapid reopening run deep — partly because a zero-tolerance stance has helped keep Covid deaths low relative to other countries.
Yanping LiBeijing Bureau Chief11/28 02:06 ETHere’s video of Bloomberg’s Allen Wan, who earlier penned a first-person account of the protests.
Adrian KennedySenior Editor, News Desk11/28 01:47 ETFor those of you joining us as Europe wakes up, here’s a brief recap of the situation in China:
- There were mostly peaceful protests and vigils across China at the weekend, with people demonstrating against Covid curbs and the government
- Censors are scrubbing social media and Chinese media is avoiding coverage.
Blank screenshots and hand-held white pages symbolize the protest
- Social media posts indicate that at least some people plan to again protest Monday night
- The BBC protested after one of its journalists was “beaten and kicked” in Shanghai, while a Chinese nationalist blogger blamed the unrest on “foreign forces”
- Covid cases are rising in China, where officials are concerned that deaths could without curbs
- China stocks dropped with the yuan, dragging down equities across Asia.
Oil tumbled to the lowest level since December
Adrian KennedySenior Editor, News Desk11/28 01:37 ETNow we’re moving closer to European markets open, stocks in the luxury goods, industrial and mining industries could all be active today after Chinese assets slumped amid protests against Covid curbs in the country.
- Luxury goods stocks like LVMH, Kering and Hermes, along with watch makers like Richemont and Swatch
- Long-haul airlines including Lufthansa, Air France-KLM, British Airways parent IAG
- In the US, keep an eye on: Macau-exposed gaming stocks like Wynn Resorts, Las Vegas Sands, Melco Resorts and MGM Resorts
Yanping LiBeijing Bureau Chief11/28 01:29 ETThat marks the strongest signal yet of the official attitude toward the protests.
Some comments seem to agree with Chairman Rabbit, and others are replying “good good good good good,” a sarcastic expression of discontent popularized by these protests. Ironically, Chairman Rabbit’s Weibo post also invited questions from curious Chinese users about what had actually happened over the weekend.Zibang XiaoReporter11/28 01:29 ETChairman Rabbit, a nationalist blogger and third generation princeling, wrote on Weibo that the protests in Beijing and Shanghai are linked to “foreign forces,” citing the “very rare” political slogans, the presence of foreign media, and other unrest popping up across China.
“Relevant departments must be actively moving now,” he concluded. Zibang XiaoReporter11/28 01:21 ETJust to contrast how the government on the other side of the Taiwan Strait is handling Covid, health authorities on the island will ease the rules on wearing masks later this week.
People will be allowed to go mask-free outdoors starting from Thursday, according to a statement from the Central Epidemic Command Center. People will still have to wear them in indoor public spaces, including on public transport.
Samson EllisTaipei Bureau Chief11/28 01:18 ETCovid protocols mean many people can’t congregate at restaurants or bars — or don’t dare to, for fear they’ll be locked down or interned in a quarantine center.
So many Chinese have looked with envy on football fans partying at the World Cup in Qatar. Now, footage reviewed by Bloomberg News and shared on social media appears to show state broadcaster China Central Television cutting coverageof stadium crowds compared to other international networks.
While not removing them completely, CCTV often replaces them with video of coaches, the team bench — anything other than thousands of jubilant or despondent (but maskless) fans.Low De WeiTrending Reporter, Singapore11/28 01:04 ETAnother speech of Xi is circulating on the Chinese Internet.
In an address at the 70th anniversary of the Korean War in Oct 2020, Xi repeated a line from Mao Zedong: “Now that Chinese people are organized, they cannot be provoked. If they are provoked, it won’t be easy to deal with.” Social media users are using Xi’s speech to mock the leader as protests happened across China over the weekend.Zibang XiaoReporter11/28 01:04 ETThe CSI 300 Index declined 1.9% while Hong Kong’s Hang Seng Index fell over 2% in afternoon trading.
The onshore yuan weakened 0.6% against the dollar, having plunged more than 1% at the open, the most since May.Charlotte YangAsia Equities Team11/28 00:44 ETSome investors are looking at a possibly more positive outcome from the latest Covid-related unrest, and some reopening stocks actually bucked the market decline today.
Read more here.“I don’t expect Xi to publicly admit error or show weakness, but this wave of protests could cause the leadership to decide privately that the exit needs to proceed more quickly than previously planned,” said Gabriel Wildau, managing director at advisory firm Teneo Holdings LLC in New York.Yanping LiBeijing Bureau Chief11/28 00:37 ETAnd two females are seen here holding a blank placard in a university in Shanghai.
(Again, unverified.)Zibang XiaoReporter11/28 00:32 ETSome signs of unrest seemed to have returned to the colleges, with a student being carried away shouting “I’d rather die than not being free” at the elite Peking University, which is known as the birthplace of the anti-imperialist May Fourth Movement.Note we have not been able to verify this footage.Zibang XiaoReporter11/28 00:26 ETThe German ambassador has just tweeted condolences to those who died in the high-rise fire in Xinjiang.
That tragedy was a key trigger for the protests, with people angry that Covid barriers and rules could have slowed rescue efforts. Since the fire, Beijing has forbidden the use of physical barriers to block fire exits or the gates of residential compounds when locking down an area.
Adrian KennedySenior Editor, News Desk11/28 00:21 ETThe curbs to stop the virus are hurting China’s economy by disrupting production, making it hard for people to shop, go to job interviews or travel.
So as much of the rest of the world hikes interest rates to revive growth, China is effectively having to increase support for the economy. One former adviser to the central bank says China must sell more bonds and cut rates.Adrian KennedySenior Editor, News Desk11/28 00:14 ETShanghai M&G Stationery Inc.
has denied the authenticity of an emergency notice allegedly issued by the company in a release posted on the Shanghai Stock Exchange website. An alleged M&G statement issued Monday has been making its rounds on the Internet.
The statement condemned the “blank paper revolution” — another phrase for the protests — and said it would stop all sales of blank paper from Tuesday. Zibang XiaoReporter11/28 00:07 ETTo be sure, more than 1 million people have died in the US, while Chinese fatalities have been low in comparison.
But the spread of the disease carries the threat of a huge number of deaths or hospitalizations in China — especially as the weather gets colder. Adrian KennedySenior Editor, News Desk11/28 00:01 ETSo Chinese authorities definitely have to try and avoid a surge in fatalities as the virus spreads in China.
But it’s interesting that top US experts went hard on China’s approach on television Sunday:“Their approach has been very, very severe and rather draconian,” Anthony Fauci, who has been Joe Biden’s chief medical adviser and the face of the US response for much of the pandemic, said on NBC’s “Meet the Press.” “They went into a prolonged lockdown without any seeming purpose or endgame to it, which really doesn’t make public health sense.”Michelle CortezGlobal Health Correspondent11/27 23:53 ETWe know for a fact that there have been multiple protests across China.
But it’s important to note that we do not have exact numbers.There are multiple posts on Twitter claiming that thousands or tens of thousands of people took to the streets in Wuhan, which is symbolic because it is where Covid had its first big outbreak.
But we can not independently confirm the reports at the moment. Adrian KennedySenior Editor, News Desk11/27 23:51 ETFurther Covid Curb Easing in XinjiangMeanwhile, over in the far-western region of Xinjiang, authorities are further easing curbs, with parcel delivery being allowed from tomorrow for low-risk areas.
This is part of a broader relaxation prompted by local unrest over the Urumqi fire incident. At least 10 people were reported to have died in the blaze and some citizens questioned whether Covid controls hampered rescue efforts.
Mourning for the casualties subsequently morphed into the wave of protests across China over the weekend, as more people voice their discontent over strict Covid rules.Many Internet users have noted the much quicker pace of easing in Xinjiang now in contrast to the grueling three-month lockdown the residents had endured.
Zibang XiaoReporter11/27 23:40 ETChinese Stocks, Currency Pare Some Losses at MiddayEarly losses for Chinese stocks eased somewhat before the lunch break. The Hang Seng Index is now down 2% while the CSI 300 Index fell 1.6%.
The onshore yuan also pared some declines after sinking the most in more than six months. USD/CNY gained 0.5% to 7.20 after rising as much as 1.1%, the most since May 12.Charlotte YangAsia Equities Team11/27 23:33 ETProtests in China against Covid curbs could disrupt short-term investor confidence just as some developers’ dollar bonds have been recovering amid new vows of bank lending support, according to Lucror Analytics.“The level of disruption will depend on how widespread and enduring the protests are, and what level of force Beijing applies to suppress them,” said Charles Macgregor, head of Asia at the independent research firm.
The protests may be beneficial to the credit market in the longer run “should Beijing adopt a more relaxed approach to controlling Covid.”Yanping LiBeijing Bureau Chief11/27 23:31 ETCovid curbs are hurting China’s economy, and protests could add to headwinds.
Bloomberg’s aggregate index of eight early indicators showed a likely contraction in activity in November from an already subdued pace in October. With Covid spreading rapidly and many major cities imposing new curbs, the outlook remains grim.James MaygerChina Economy Team11/27 23:26 ETEd Lawrence, the BBC reporter who was beaten up by Chinese police, according to the broadcaster, says another reporter was also arrested.
Adrian KennedySenior Editor, News Desk11/27 23:20 ETA song that has featured frequently in this wave of protests is the Internationale, the de-facto anthem of the Chinese Communist Party, presumably sung as a reminder to the party of its roots and signaling that the protesters mean no subversion of the state.
In the same vein, China’s national anthem has also been sung during the protests. Zibang XiaoReporter11/27 23:12 ETAnd an interesting piece here from Hallie Gu and Alfred Cang about the impact of Covid controls.
Some farmers are destroying crops they can’t get to market. Jasmine NgAsia Metals & Mining Reporter11/27 23:10 ETIn a potential sign of the official attitude, the partner of Zhao Lijian, the sharp-tongued foreign ministry spokesperson, has been accusing “foreign forces” of being behind the protests over the weekend.
She did not allow comments and reposts to be visible to the public, though several reposts that slipped through the cracks slammed her rhetoric. Zibang XiaoReporter11/27 23:02 ETAlmost every province in China is reporting hundreds, if not thousands, of infections.
Anywhere else in the world the virus would resolve this conundrum – the highly contagious omicron variant spreads out of control once its gained a solid foothold. But China is still tracking every case.
That means there isn’t an underbelly of undetected infection and silent transmission chains. It’s still possible to get this under control. But at what price?Michelle CortezGlobal Health Correspondent11/27 22:58 ETThe protest in Beijing bought out some unlikely demonstrators – I saw at least two corgis out with their owners, as well as a bulldog in a chicken outfit walking along the street in the main body of protesters.I also chatted briefly with a man with a broken leg, who was being pushed in a wheelchair through the crowd.
That just emphasises how peaceful the demonstration was, at least in Beijing.James MaygerChina Economy Team11/27 22:56 ETPolitical analysts have observed that women are playing a huge role in this wave of protests, with many of them standing up and taking the lead.
The experts attributed that to the awakening of the collective consciousness with the spread of the Metoo Movement, and the state’s continued repression of women’s rights.Zibang XiaoReporter11/27 22:53 ETA brief sidebar: A deluge of spam on Twitter is making it harder to find posts on the protests.
Searches for Shanghai and other Chinese cities are flooded with what seems to be bot accounts publishing sexually suggestive images and attempts at solicitation.Rebecca Choong WilkinsAsia Government & Politics Correspondent11/27 22:51 ETMoody’s Petch: China Protests to Dissipate, Unlikely to Cause Political ViolenceIn a statement, Martin Petch, vice president of Moody’s Investors Service, said he expects the protests in China to “dissipate relatively quickly and without resulting in serious political violence.”“However, they have the potential to be credit negative if they are sustained and produce a more forceful response by the authorities,” he wrote.
“Though this is not our base case, this would lead to an increased level of uncertainty over the degree of political risk in China, spilling over into damaged confidence and hence consumption in an already weakened economy.” Colum MurphyAsia Government Team11/27 22:50 ETMapping China’s Current Covid OutbreakPeople should be careful not to overstate the support for removing Covid Zero restrictions in China.
While there’s certainly some people who are tired of the current situation, others are afraid of an outbreak.Some people in Shijiazhuang in Hebei were panicked earlier this month when that city looked to be relaxing testing requirements and controls.
The rising number of cases in every province will worry those people, and also concern local governments across the country, who don’t want to see an inevitable spike in serious illness and death.James MaygerChina Economy Team11/27 22:47 ETLa Jeunesse had a manifesto for Chinese youth, which read: Be independent and not enslaved.
Be progressive and not conservative. Be in the forefront and not lagging behind. Be internationalist and not isolationist. Be practical and not rhetorical. Be scientific and not superstitious. Zibang XiaoReporter11/27 22:47 ETThe protests — mainly driven by China’s younger generations — have a few callbacks to the anti-imperial May Fourth Movement, which led to the founding of the Chinese Communist Party.
For example, some Chinese are referencing La Jeunesse, a Chinese literary magazine that inspired the movement. The magazine was founded by Chen Duxiu, co-founder of the Communist Party. Zibang XiaoReporter11/27 22:45 ETThe situation was relatively calm in Guangzhou over the weekend, with no major protests despite its status as the capital of the second hardest-hit province in the country.
Many university students are prohibited from leaving their campuses, or even their dorms, while sporadic conflicts between urban villagers and their residential communities were quickly snuffed out.Michelle CortezGlobal Health Correspondent11/27 22:41 ETWhile experts say the protests don’t present an existential threat to Xi Jinping or the Party, it’s the first time the Chinese president is facing widespread social unrest since taking the top job.
Here’s Yasheng Huang, MIT Sloan School of Management professor:“These protests alone are unlikely to threaten the Party. The question is whether there will be fissures within the Party. A likely scenario is a combination of easing the zero Covid measures while going hard after a few protesters they consider as leaders.
That will buy them some time.”Rebecca Choong WilkinsAsia Government & Politics Correspondent11/27 22:35 ETMapping latest Covid unrest activitiesThe protests weren’t limited to Beijing over the weekend.
Social media posts indicate there was unrest of varying degrees across most major cities. Samson EllisTaipei Bureau Chief11/27 22:32 ETWith all the focus on protests in China, it’s important not to lose sight of what’s happening with the virus.
Cases hit a new record on Sunday, and every province is reporting new daily cases for weeks.The government has backed itself into a corner – if it accedes to some peoples’ demands to loosen Covid Zero restrictions, infections are likely to soar.
But if it clamps down or locks down multiple cities it will further damage the already weak economy and likely generate more unrest and unhappiness.James MaygerChina Economy Team11/27 22:30 ETMore tests are being disrupted.
An English proficiency test widely taken by university students in China to brush up their resume has been delayed in Beijing, with no new dates announced yet. Zibang XiaoReporter11/27 22:28 ETThe anger is extraordinary — and it’s not just over Covid curbs.
Adrian KennedySenior Editor, News Desk11/27 22:26 ETWhile Beijing’s Covid infection count on Sunday dipped from that of Saturday’s, still shy of 5,000 cases, there is a possibility that the case count is under-estimating the true scale of spread, as people are unwilling to come forward for PCR tests due to the fear of being taken away to a quarantine camp.
Those loathed government facilities, where conditions are so poor that some people are ordering chamber pots and portable tents in preparation, are a major reason why Beijingers are staying home.Rachel ChangAsia Consumer & Healthcare Team Leader11/27 22:24 ETAnother viral post on Weibo is challenging the popular state rhetoric criticizing other countries for “lying flat” on Covid controls.
The post said they have been increasing vaccination rates and reimbursing affected businesses. “Now there are only three kinds of people who do not want to scientifically solve the problem. One is getting power from it, one is getting profits from it, and the third is stupid.” Zibang XiaoReporter11/27 22:23 ETWhat’s Traffic Like This Morning in Major CitiesWhile protesters are hitting the streets at night, cars are staying off the road during the day.
Covid lockdowns have slowed traffic in several Chinese megacities, according to data from Baidu Inc.:
- Beijing streets were 45% less congested at 8:30 a.m. than a year ago
- Guangzhou -35%
- Chongqing -50%
- Zhengzhou -31%
- Wuhan -37%
And oil prices have slumped this morning on concerns that demand could falter in the world’s largest importer.Dan MurtaughEnergy Reporter, Singapore11/27 22:22 ETAs Covid cases jump in China, the country’s National Civil Service Administration has postponed the civil service written tests initially scheduled for Dec.
3 and 4. The news is the no.1 trending topic on Weibo now, with many users complaining that the pandemic has thrown another wrench into their plans. China’s civil service jobs are the top destination for graduates now, as the economy slows down and firms hire fewer people.Zibang XiaoReporter11/27 22:20 ETThe protests spread across China quickly.
Here’s how:Adrian KennedySenior Editor, News Desk11/27 22:19 ETIn a possible sign that the censors are being stretched thin, images on overseas anti-Covid protests are making their rounds on Weibo. The majority of the comments are thanking the protesters, with one comment referencing the Manchester incident and challenging the Chinese embassy to beat people up again.
Zibang XiaoReporter11/27 22:15 ETMarket watchers say Chinese assets may remain choppy in coming months as the government repositions itself in managing Covid outbreaks. Policy makers face an “impossible trinity” of achieving dynamic Covid Zero, ensuring social stability and economic development.
“Reality on the ground is chaotic as officials struggle to implement the 20 new guidelines on Zero Covid while keeping the number of cases from rising. The juggling act is likely going to continue well into the winter and the rise in number of cases may reach a point of no return, in which achieving zero cases will no longer be possible barring a full lockdown across all cities in China,” said Steven Luk, chief executive officer at FountainCap Research & Investment in Hong Kong.Charlotte YangAsia Equities Team11/27 22:14 ETWhile China’s markets slid amid the protests, the only briefing going live on the state TV’s mobile app Monday morning has been the one held by three Chinese taikonauts for the upcoming Shenzhou-15 mission.
They are not wearing masks at the Jiuquan satellite center in Gansu province.Attending the briefing would have required a quarantine.Adrian KennedySenior Editor, News Desk11/27 22:10 ETIn the last hour or so, Chinese currency and stocks markets have shown some recovery.
The onshore yuan is now down 0.5% against the dollar after a plunge of more than 1% at the open, and the drop in the benchmark Shanghai Composite Index has narrowed to 0.9% from as much as 2.2% earlier.
Read more about the market woes.Penny PengManaging Editor, Bloomberg News in Chinese11/27 22:05 ETIn almost 13 years in China, our colleague Allen Wan had never seen anything like that which he saw last night in Shanghai:“I’ve never seen so many police gathered in one spot in China.
Several dozen formed a human barricade on one block to prevent people from walking along the road — and possibly repeating the scene of the previous day’s protests — while hundreds more masked and uniformed officers were bussed into its narrow lanes as a show of force.” Yanping LiBeijing Bureau Chief11/27 22:01 ETWith blank placard emerging as a symbol of the protests, some Internet users have dubbed the rally the blank paper revolution or the A4 paper revolution.Zibang XiaoReporter11/27 21:53 ETExtraordinary scenes in China over the weekend:Adrian KennedySenior Editor, News Desk11/27 21:44 ETRead more on Goldman Sachs’ forecast of a potential earlier China reopening, with some chance of a “disorderly” exit．The bank forecasts a 30% probability of China reopening before the second quarter of 2023, chief China economist Hui Shan wrote in a note late Sunday.
“The central government may soon need to choose between more lockdowns and more Covid outbreaks,” she wrote.Yanping LiBeijing Bureau Chief11/27 21:39 ETThe second surprise was the restraint of the police.
While they did attempt to clear protest sites and the streets, this was mostly done by a line of police linking hands and walking forward to corral people, with no attempts to actually arrest anyone that I saw.
By the time I left the protests, police outnumbered everyone else, but were just blocking access to certain roads and telling people “go home.”James MaygerChina Economy Team11/27 21:38 ETTwo things surprised me from the protests overnight in Beijing.
One was the bravery of the protesters – to go on the streets and call for change in China is an incredibly courageous act, as can be seen from the swift reaction to the bridge protester last month.
There were police everywhere last night, and the site of the protest in Beijing is just next to a camp of the People’s Armed Police, who are charged with maintaining internal order.James MaygerChina Economy Team11/27 21:37 ETThe protests represent a significant challenge to the Chinese government, which faces tough choices over how to manage Covid curbs in the face of widespread discontent without allowing an explosion of infections that could kill thousands of people.The unrest also comes just weeks after President Xi solidified his control of the Communist Party.
The problem with unfettered control, as Rebecca Choong Wilkins points out in this deep dive into Xi’s power, is that it’s difficult to pass the blame when things go wrong. Adrian KennedySenior Editor, News Desk11/27 21:33 ETWatching Traffic Data for Likely Signs of Unlocking Post UnrestSocial media users are saying the number of passengers on the Beijing subway is noticeably higher today, as some neighborhoods have relaxed control measures and companies asked people to come back to the office, at least in parts of the populous Chaoyang district.
We will get the Monday subway ride numbers tomorrow morning. On Sunday, there were 493,200 passenger rides, a 67% drop from the same day a week ago, according to data released on the official Weibo account of Beijing Subway.
Penny PengManaging Editor, Bloomberg News in Chinese11/27 21:32 ETLooking back on oil prices, the unrest in China over Covid Zero curbs has rattled an already-fragile market beset by demand concerns. The US crude benchmark just shed all of this year’s gains.
Yanping LiBeijing Bureau Chief11/27 21:29 ETThe BBC has said it’s “extremely concerned” at the treatment of journalist Ed Lawrence in Shanghai: Adrian KennedySenior Editor, News Desk11/27 21:25 ETTaiwan’s premier, Su Tseng-chang, says Taipei is closely watching China’s reaction to the protests.Samson EllisTaipei Bureau Chief11/27 21:18 ETSome nationalist accounts on Chinese social media are pushing back though, linking the blank placard to subversion, saying it is a protest technique used by Hong Kong independence activists.
They caution that “foreign forces” could be photoshopping any slogans they want onto the blank paper. Zibang XiaoReporter11/27 21:17 ETBlank paper has emerged as a symbol of protest in China, as officials are deleting content so quickly that some internet users complain nothing meaningful could be expressed at all.
One video featured a blank piece of paper on WeChat with the caption, “silence speaks louder here, those who understand know.” It was deleted. Zibang XiaoReporter11/27 21:16 ETThere has been no official response to the protests over the weekend so far.
In Beijing, the protests also seem to have temporarily paused given it’s a working day today. The Communist Party’s mouthpiece People’s Daily ran another commentary today calling for more effective implementation of the latest Covid policies so as to rapidly curb the current spread of the pandemic, which seems a bit detached from reality, at least in cities with major outbreaks.Jing LiBeijing Bureau11/27 21:14 ETBut Weibo users on the whole are not buying the expert’s recommendation, with some saying sarcastically, “of course, companies still have not earned enough from Covid tests and quarantine hospitals.” Chinese social media has been ramping up criticism against companies seen as profiteering from the pandemic, including PCR test firms and hospital builders.
Zibang XiaoReporter11/27 21:13 ETWhat’s Trending on Chinese Social Media Platform Weibo:Half of Weibo’s top 10 trending topics are now on Covid. The No. 1 topic is about how highly transmissible Omicron is, with a hospital expert interviewed by Beijing Daily recommending people wear N95 masks instead of the normal surgical masks to protect themselves.
Zibang XiaoReporter11/27 21:11 ETOil Prices Tumble to Lowest Since 2021The protests are creating more demand uncertainty in the world’s largest commodity user, sending oil prices crashing to the lowest since 2021.
A return to stricter lockdowns could slow factory operations as they send workers home to manage flare-ups, reducing the need for for gas and power, as well as for diesel needed to transport goods. Commuter traffic and airline flights have also slowed to a crawl, further weighing on oil demand.
Dan MurtaughEnergy Reporter, Singapore11/27 21:08 ETRobert Mumford, an investment manager at GAM Hong Kong Ltd, says:“The protests create uncertainty but the destination of opening up has been set since the party Congress.
It’s just the path and pace which is not clear.One suspects this sort of public pressure might encourage a faster pace of opening which would be a positive but it remains to be seen how the authorities react to recent events.”Charlotte YangAsia Equities Team11/27 21:07 ETLatest Catch-up SummarySo here’s a catch-up on what we know:
- There have been (mostly peaceful) protests and vigils in China over the past three days
- A deadly fire in Xinjiang caused anger, with people suspecting Covid curbs delayed rescue efforts
- Chinese censors are scrubbing social media of mentions of the unrest
- The People’s Daily newspaper today called for more effective implementation of Covid policies
- China wants to prevent a Covid surge that could kill thousands, but residents are tired of curbs
- Chinese stocks and the yuan have slumped, while the US dollar has climbed
Adrian KennedySenior Editor, News Desk11/27 21:04 ETCovid-19 cases in the capital Beijing remain elevated, after almost doubling over the weekend, while infections nationwide continue their record upward march.
Read more: Covid Infections Persist in Beijing as Policy Pushback Grows Yanping LiBeijing Bureau Chief11/27 21:03 ETYou can read a deeper dive into the protests at the iPhone factory from our colleagues at Bloomberg Businessweek here.Adrian KennedySenior Editor, News Desk11/27 21:02 ETApple Inc.
partner Foxconn has seen its factory in Zhengzhou roiled by protests as it has tried to keep up production while containing Covid. It’s now offering bonuses of as much as $1,800 to existing workers at the facility, hoping to sustain the staff levels needed to run the world’s largest iPhone factory, Debby Wu reports.Adrian KennedySenior Editor, News Desk11/27 20:59 ETChristopher Wong, foreign exchange strategist at Oversea-Chinese Banking Corp, says:“China protests likely to undermine sentiments and investors will assess how policymakers balance between lockdown and Covid spread.
Negative spillover to regional equity markets and FX likely in the near term but should be contained unless we get another escalation in social discontent”Chester YungFX Rates Asia Reporter11/27 20:55 ETRead more on yuan’s outlook from our colleague Simon Flint, who expects the dismay to continue:Yuan Faces Tough Week With Covid Policy in DisarrayYanping LiBeijing Bureau Chief11/27 20:50 ETFollowing on from what Sarah was saying about the World Cup, social media posts indicate Chinese broadcasters have stopped showing cutaway shots of unmasked fans in the stadiums, keeping the cameras trained on the players and coaches only, to keep a lid on awkward questions about the government’s Covid policies.
Samson EllisTaipei Bureau Chief11/27 20:49 ETGoing through a first wave of Covid is terrifying. It’s an experience most people in China haven’t had. Many don’t know anyone who’s been infected.
But once through that gauntlet, the low mortality rate provides reassurance. And infection leaves some level of immunity for future outbreaks. Michelle CortezGlobal Health Correspondent11/27 20:48 ETAnother reason for Chinese to question Covid policy?
The mask-free World Cup soccer tournament in Qatar. Curbs mean many Chinese fans have to watch at home, not with friends in bars or other venues. A (now-deleted) article questioning Covid Zero policies in light of the tournament went viral on WeChat last week.
And one Weibo user wrote on Sunday: “Not a single person at the World Cup was wearing a mask, so does that mean that Covid policies abroad are better than in China, or is there something else that’s going on in China?”Sarah ZhengHong Kong Bureau11/27 20:48 ETLighthouse Investment: Buying China a Tricky “Leap of Faith”Here’s Brian Quartarolo, of Lighthouse Investment Partners, who says he has already “de-risked” to a considerable extent and will await month-end rebalancing before re-initiating much:Perhaps some of the China protest noise will die down a bit by then, too.
More broadly, we can agree that it will be some time before the macro data improves (even as liquidity metrics have stabilized, domestic demand will struggle if people don’t leave home), so buying China is going to be a tricky “leap of faith” for foreigners like me for a while ahead.Sofia Horta e CostaChief China Markets Correspondent11/27 20:46 ETOnshore Yuan Extends LossOnshore Yuan Extends Drop to 1% vs Dollar on Protest ConcernSamson EllisTaipei Bureau Chief11/27 20:45 ETMuch of the rest of the world dismantled Covid curbs a long time ago, and China’s approach is starting to chafe.
The French Chamber of Commerce and Industry in China last week called for the Chinese government to “faithfully implement” recent Covid-easing measures and to withdraw “unnecessary and excessive curbs.”Adrian KennedySenior Editor, News Desk11/27 20:44 ETRecap on China’s vaccination dilemmaLet’s recap why China has these problems: Earlier in the pandemic, with cases rare, people didn’t need to really grapple with the pathogen.
There was less pressure to get vaccinated since the risk of infection was low. Fewer infections led to low levels of natural immunity. And the immunization rate hasn’t noticeably picked up, leaving much of the country vulnerable.
Michelle CortezGlobal Health Correspondent11/27 20:43 ETThe yuan is weakening in both onshore and offshore trading, while commodity-linked currencies such as the Aussie led losses against the dollar on risk-off mood.
The onshore yuan tracked offshore losses shortly after trading started, declining as much 0.96% to 7.2320, the most since Oct 27. Wenjin LvChina FX/Rates11/27 20:41 ETIn Beijing, more residents have concluded that it might be better to recover at home rather than being transferred to the government’s makeshift hospitals, after seeing the poor conditions and lack of medical assistance there.
In some communities, people are voluntarily signing up for consent letters to let neighbors stay at home if they test positive. But this could be risky and against the current Covid Zero policies. It is yet to be seen whether such pushback by more communities will be allowed by the authorities.
On the other hand, Beijing is obviously quickly running out of hospital beds as case numbers surge.Jing LiBeijing Bureau11/27 20:39 ETContinuing a trend of reposting official speeches to voice their discontent, Internet users are now sharing a quote from Mao Zedong asking the party to not repress people’s criticisms and to not stand opposed to the public.
Zibang XiaoReporterRead more on the terminal…
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