Coronavirus returns to bite China again
While the West is consumed by its own mounting panic, it is easy to forget that China, where coronavirus began, is still in all sorts of trouble: growth rates are tumbling and stimulus is a certainty. Now Covid-19 is making landfall in southeast Asia.
The feedback loop has started. On March 19, China announced no new cases of coronavirus in Hubei, whose capital Wuhan lies at the epicentre of the Covid-19 outbreak, for the first time in eight weeks.
Good news? Sort of.
Viral egress has turned into ingress: on March 19, China’s National Health Commission counted no fewer than 34 cases of ‘imported’ coronavirus, many from expatriate Chinese office workers and students, fleeing the pandemic-hit West for the perceived safety of mainland towns and cities.
It is a cyclical process at work across Asia’s largest economy.
The Shanghai Composite Index plunged 11.3% in the fortnight to February 3, a period spanning a Chinese New Year and extended by a government hoping to contain the outbreak.
Slowly China’s economy clambered out of its hole, regaining all of its losses.
Then Covid-19 hit Europe and the US and – Blam! – from March 5 the index plunged another 12%, hitting a 13-month low on March 19.
Hong Kong’s Hang Seng index tracked Shanghai’s performance, losing 21% in value over the same two-week period, as investors realised that just because China was shaking off its cold, it didn’t mean the world was.