It may have taken a while, but it was only a matter of time before China – inventor of the Covid virus (with financial backing from Fauci) and trillions of trillions in economic devastation – succumbed to the pandemic.
As we reported yesterday, the western Chinese city of Xi’an has begun extensive disinfection measures since late Sunday to counter a surge in Covid infections that forced the closure of 13 million residents. In images reminiscent of January 2020, authorities are spraying disinfectant across the city, urging residents to close windows and avoid contact with architectural surfaces and vegetation on the streets. Private cars are not allowed to drive on the streets, and those who break the cordoning off are publicly shamed and shown with posters with their names on them – a disciplinary measure in the style of the Cultural Revolution.
The move was taken as the number of daily infections rose to around 150 on Sunday and Monday – one of the highest daily increases since the first wave of Covid to flood Wuhan – and health officials are attempting to uncover more cases with a fourth round of mass tests .
Then on Monday, just over a month before the start of the 2022 Winter Olympics in Beijing on February 4, China reported a total of 162 domestic Covid infections, 150 of them from Xi’an, the highest daily number of cases since January 22. Such a surge is rare in China, as it is the only large country in the world that is still aggressively trying to eradicate the virus through closed borders and strict domestic restrictions under what is known as a zero-covid strategy.
The outbreak in Xi’an, in which more than 600 cases have occurred in less than three weeks and for which the delta variant is blamed, makes it clear how difficult it is for China to reduce the number of infections in its own country to zero to reduce as the virus mutates. The country claims to have found only a handful of omicron infections in travelers from other countries, but the far more infectious and immune-weakening variant has not spread to the population either.
It is only a matter of time before even China can cover up the fact that hundreds of millions of Chinese are infected with Omicron, which in turn means that it is only a matter of time before we see another round of collapse in China’s supplies experience.
Jeffrey Landsberg, founder of Commodore Research, takes up this topic and states in his latest daily newspaper that the number of coronavirus cases that occur daily in China continues to rise. “At least 200 new coronavirus cases have been reported daily in China for the past three days,” a value that has not been reached since March 2020.
As a result, new restrictions continue to apply in China, including the city of Xi’an (home to 13 million people), which remains cordoned off. The residents are still not allowed to leave the city, but only to go shopping or for examinations from their homes. Overall, it remains to be seen when the outbreak will subside and, in our view, it is also becoming increasingly likely that foreign visitors will not be allowed to travel to China for the Olympics. However, there are still no signs that the Olympic Games will not take place in February as planned.
But a far bigger wildcard than the Olympic Games is the question we asked last night, namely what happens if (or rather, if) China can no longer contain Omikron and is forced to stop operations again?
And speaking of the devil, just a few hours later we received the first confirmation that the latest Chinese Covid outbreak could be the most serious yet, after Korean tech giant Samsung Electronics announced that it was making flexible adjustments in light of the spread of the coronavirus in its chip production line in Xi’an, China.
Due to the ongoing COVID-19 situation, we have decided to temporarily adjust operations at our production facilities in Xi’an, China.
This decision was made in line with our commitment to protecting the health and safety of our employees and partners, which remains our number one priority.
We will also take all necessary measures, including using our global manufacturing network, to ensure that our customers are not affected.
What happens now? As a reminder, the last time China’s mega-ports Yantian and Ningbo were closed, the supply chains collapsed and freight rates rose to astronomical heights after a slight delay (see “Shippers Frantic After China’s Busiest Port Shuts Container Terminal Due To Covid“ und „Brace For Astronomical Shipping Costs As China Goes Into Lockdown Mode“). It is only a matter of time before the rapidly expanding omicron leads to a similar port closure and a renewed paralysis of transpacific shipping.