Having started out slowly on vaccinations, and focusing instead on simple control of virus spread, China has now moved inoculations into high gear just as small outbursts of infections appear in various places, including the city of Guangzhou. Possibly as many as 20 million vaccine doses are being administered per day, and by the end of this month China could have 40% of its population vaccinated. That’s still behind the US and many other countries, but it doesn’t matter so much at this point due to the low infection rates. China’s borders remain closed, and one report this week suggested it could be the second half of 2022 before they are fully re-opened. The question is when, if ever, does the economic impact of the lockdowns become significant enough for the Center to allow for a certain level of infections to exist in order to allow open borders, as other countries are, as part of the post-pandemic trajectory? Later rather than earlier, if our view.
China and the US are moving back towards at least talking regularly about the existing issues on trade and economic ties, even as the decoupling process continues. This week US Treasury Secretary Janet Yellen had a video call with Chinese economic heavy-hitter Liu He, following a conversation last week between Liu and US Trade Representative Katherine Tai. Little is known of the content, and the chats were characterized as “frank”. But at least they are talking. Another key development is that there was an expansion of the list of Chinese companies ruled off-limits for US investment, particularly firms connected in some way to defense and surveillance technology.
And finally, there was a Politburo meeting at which top leader Xi called for the creation of an image of China as being “trustworthy, lovable and respectable”. The message was clearly that the Chinese government should do more about promoting its side of the story globally while projecting a sense of China as being “open and confident, but also modest and humble.” A lot of money is heading in that direction, it would seem, even though there is an obvious irony to heavy official usage of international social media channels to promote such messages while said channels are unavailable domestically. But it could be that a more nuanced approach to, for instance, foreign media organizations reporting on China is about to result. The NYT currently has only one correspondent in the country, and the WSJ and the FT are on four each. If the Center allowed the foreign journalists to come back, there would be more good stories and more bad stories too, but at least the coverage would be more in tune with the reality of China today.
Have a good weekend.