China remains firmly shut

Here are the ten biggest cities courtesy of Tom Tom:

I think it safe to say that if it’s the top ten then it’s everywhere. This is even more important given the CCP ordered everyone back to work this week. Fat chance. Why would you go when if you do you’ll get hosed with Round-up:

The latest from Sinocism:

The National Health Commission changed the way it classifies confirmed cases of the COVUD-19 virus in Hubei and so there was a huge spike of 14,840 new cases in the province. The reclassification is good for all the people who are sick but were not confirmed under the previous method.

Chen Yixin, the deputy head of the “central guiding group” in Wuhan, admitted that the government has not yet finished counting all the infected cases in the city and “the number could be quite large”-陈一新:武汉感染人数未摸清 潜在被感染基数或较大


The situation remains very grim in Hubei and more cities in the province are going into quarantine lockdown. Do not be surprised for significantly higher case numbers to come.

The announcement of the surge in new cases coincided with the replacement of the Hubei provincial and Wuhan municipal party secretaries. Ying Yong, previously mayor of Shanghai, replaced Jiang Chaoliang as provincial party secretary. Wang Zhonglin, previously party secretary of Jinan, replaced Ma Guoqiang as Wuhan party secretary. Announcing the much higher number just before the appointments is of course politically beneficial to the new leaders.

Wednesday also saw the appointment of Xia Baolong to replace Zhang Xiaoming as head of the Hong Kong and Macau Affairs Office.

Both Ying Yong and Xia Baolong have long histories working with Xi Jinping and are considered members of what is known as the “New Zhijiang Army 之江新军” of Xi acolytes.

Once again, the evidence points to Xi being in control and putting even more of his personal credibility at stake, in spite of all the rumors that have swirled in the last couple of weeks, as I discussed last week.

Thanks for reading.

1. Political fallout

Latest Surge of Infections Drives Beijing to Oust Top Hubei Party Officials – Caixin

Jiang Chaoliang, party chief of Hubei, has been replaced by Shanghai Mayor Ying Yong, and Ma Guoqiang, party chief of Wuhan, the provincial capital, has been succeeded by Wang Zhonglin, party secretary of Jinan, East China’s Shandong province, state media said…

It also followed the sacking on Tuesday of two top health officials in Hubei — Zhang Jin, party chief of the Hubei Health Commission, and Liu Yingzi, provincial health commission director — over their flaws in responding to the epidemic.

Coronavirus: Beijing purges Communist Party heads in Hubei over outbreak response | South China Morning Post

News of the reshuffle coincided with a State Council meeting on Thursday when it was announced the draconian control measures currently in place in Wuhan – the epicentre of the outbreak – would be expanded to other Hubei cities including Huanggang and Xiaogan.

“Hubei province and Wuhan must further strengthened management and control over exits from the areas … to put a stop of the spread [of the disease],” state broadcaster CCTV quoted a read out of the meeting as saying…

The new appointments could help mend ties with the public, but it remained to be seen whether the newcomers could end the crisis soon, said Qin Qianhong, a law professor at Wuhan University.

“They could help calm public anger over the incompetence of local officials, but there’s too much still unknown with the virus and how bad the situation really is,” Qin said…

“Sending Ying Yong and Wang Zhonglin to Hubei shows the central government is determined to fix Hubei and give people an answer. The cadres there have been really disappointing,” said a person familiar with the developments in the province who was not authorised to speak publicly on the matter. “The outbreak cost the party dearly. Those who are responsible will be held accountable.”


Ying Yong said the appointment shows the party central and Xi Jinping “highly trusts” him, and that the new job has “heavy responsibility”, and will be a “major test” for him.

China reshuffles top officials in coronavirus epicenter Hubei Province – Global Times

Faced with the sudden CODIV-19 outbreak, problems such as sloppiness and poor management of work have been exposed among Wuhan and Hubei authorities, reflecting severe loopholes in local governance. The appointment of new officials will not only enhance prevention and control measures against the outbreak but also aim to highlight the urgency of improving crisis-handling capability among officials, analysts said.

Beijing battles ‘crisis of Chernobyl proportions’ in coronavirus outbreak | South China Morning Post

Zhao Suisheng, a political scientist at the University of Denver, said there was much less diversity of domestic public opinion about the causes of this crisis than for the trade war or the Hong Kong protests.

“Many Chinese sympathised with the government on the trade war, but the mainstream public opinion now is almost one-sided against the government,” said Zhao, who has written several books on Beijing’s control of information and public opinion. “This is something I haven’t seen since 1989.”..

Zhao from the University of Denver said despite all this, it did not amount to a legitimacy crisis for Beijing. “As long as the economic growth does not see a steep fall, it’s still a key pillar for the party’s legitimacy,” Zhao said. “There’s also overreactions from other countries, including a level of racism abroad, that could be fed into the party’s nationalistic narrative.”

2. The outbreak

China’s Hubei reports jump in new cases of COVID-19 after diagnosis criteria revision – Xinhua

China’s Hubei Province, center of the novel coronavirus (COVID-19) outbreak, reported 14,840 new confirmed cases and 242 new deaths on Wednesday, the highest daily increases so far, local health authorities said Thursday….

Clinically diagnosed cases are unique to Hubei statistically. The inclusion of those cases drives the surge in the number of new confirmed cases.

Any suspected cases with pneumonia-related computerized tomography (CT) scan results are counted as clinically diagnosed cases, according to the latest version of the diagnosis and treatment scheme released by the National Health Commission.

The provincial health commission said the diagnosis criteria revision has been made to give those who have been clinically diagnosed the timely standard treatment of confirmed cases to further improve the treatment success rate.

What’s Behind China’s Massive Spike in Coronavirus Cases – Caixin

Chinese authorities have played down a dramatic jump in confirmed cases of Covid-19 in Hubei province, saying most of the over 14,000 cases added overnight came from changed diagnostic criteria that allowed chest x-rays to be used alongside standard laboratory tests.


Xinhua says “don’t be terrified by the sharp increase in new cases”, says the goal is to make sure that everyone who needs to rounded up and treated is, and by classifying all those as confirmed cases they will be able to get the epidemic under control faster and prevent its spread. It also motes that the number of suspected cases continues to drop and that that the channels for transmission are narrowing quickly

关注疫情防控 | 湖北今天新增确诊病例为何大幅增加?


Taoran Notes says the revised classification methods reflect “seeking truth from facts” and progress in rounding up everyone who should be rounded up

Sharp Rise in Coronavirus Cases Raises Questions About Outbreak’s Peak – WSJ $$

Zeng Guang, a prominent epidemiologist affiliated with the Chinese Center for Disease Control and Prevention, cautioned on his Weibo account Wednesday that even if the outbreak’s turning point had been reached, the epidemic could pick up speed after 160 million people return from their hometowns, to which many had traveled for the Lunar New Year holiday, to where they work.

“What I worry most is that the downward trend we saw lately is because the statistical data was behind the time of infection, and thus has masked the actual upward trend caused by the return trips, making people relax their vigilance,” Mr. Zeng said.

Fox News reporter on the Trump Administration view of the numbers:

Coronavirus Latest: Wuhan Infections Jump By More Than 13,000, Hubei Party Chief Removed – Caixin Global

A bullet train cleaning staff member tested positive for the new coronavirus, now known as Covid-19, fueling fears that the virus might have been spread to passengers on more than a dozen trains.

Experts fear China reluctant to accept WHO ground mission – Reuters

China is dragging its heels in accepting help on the ground from international health specialists, diplomats and experts said on Thursday, noting four days after a World Health Organization (WHO) advance team arrived in Beijing no details have been released on how and when the full mission will deploy.

Yicai Global – Baidu Releases Code for Face Scanner Able to Tag People Who Don’t Don Masks

Chinese tech company Baidu said today that it has developed the first free open-source facial scanning model that uses artificial intelligence to identify people who are not wearing protective masks despite the outbreak of fatal novel coronavirus in the country, The Paper reported.


People’s Daily has made a short video “Righteously go into battle” on the fight against the epidemic, with quite the soundtrack

China blacklists individuals for concealing symptoms, violating quarantine – Xinhua

Chinese provinces of Anhui, Jiangsu and Jilin, as well as the cities of Shanghai, Chongqing and Hangzhou have approved guidelines to blacklist those who violate quarantine or conceal coronavirus symptoms, travel history in key virus-hit regions or history of contact with confirmed and suspected patients.

Those in violation will not only be subject to legal liabilities in accordance with the law but be blacklisted on the local credit information platform, according to the guidelines.

China Focus: Chinese researchers isolate novel coronavirus strains from feces – Xinhua

Two separate research groups led by China’s top scientists said they had isolated novel coronavirus strains from samples of infected patients’ feces, but further study is needed to prove the existence of fecal-oral transmission


Caixin reports that Beijing had its first COVID-19 patient on January 12, Guangdong’s first was January 4, Shanghai’s was January 15

Road-tripping through fear, rumors, and a virus-stricken China – SupChina

After 2,500 kilometers (1,600 miles), 15 checkpoints, and countless temperature screenings, we had reached Beijing. We swung the car into a parking lot just on the corner of an intersection close to the Drum and Bell Tower.

3. Economic Impact

Party center’s big fear is mass unemployment.

Vice premier stresses stable employment amid epidemic – Xinhua

Chinese Vice Premier Hu Chunhua has called for all-out efforts to ensure stable employment amid the novel coronavirus outbreak.

Hu, also a member of the Political Bureau of the Communist Party of China Central Committee, made the remarks Thursday at a teleconference on employment work amid the epidemic…

Stable employment is significant to resuming production, guaranteeing and improving people’s livelihood, and maintaining sound market expectations, Hu said…

Massive layoffs must be prevented via efforts to help businesses keep their payrolls stable, while aid should be offered in a timely manner to those in need, he said.

Coronavirus: China’s fear of mass job losses looms large as Covid-19 takes toll on economy | South China Morning Post

Recruitment site Zhaopin said this week that around 10 per cent of firms they surveyed were “on the verge of death”, with around 30 per cent planning job cuts and another 30 per cent saying they could not pay their employees on time…

In 2003, which included the severe acute respiratory syndrome (Sars) outbreak, around 8 million people lost their jobs, according to official Chinese data, although real job losses may have been much higher because government data did not cover most migrant workers.


People’s Daily front page commentary asking the cadres to “strive to win the two victories on both controlling the epidemic and realizing the economic and social development goal”. It said, “Taking into account the general situation, we still insist on the economic and social development goal this year. All the economic and social development work decided and planned by the party central shall be done properly, all the goals and tasks set by the party central must be accomplished. There must not be ideas of slowing down or waiting it out.”


China pushes for differentiated measures to battle coronavirus – Xinhua

While ordering Wuhan to speed up hospital admission and suspected case quarantine, the leading group instructed hard-hit cities in Hubei such as Xiaogan and Huanggang to carry out equally strict measures as in Wuhan in surveillance, quarantine and treatment.

The demand for more medics in Hubei and Wuhan should be fulfilled, and the departure channels of the city and the province need further control, according to the meeting…

Each province is responsible for formulating differentiated epidemic prevention and control strategies based on their own conditions, according to the meeting.

Comment: The local officials are under huge pressure to prevent an outbreak in their areas while at the same time getting their local economy up and running again. It is almost a no-win choice for them, but so far most seem more focused on stringent measures to prevent the spread of the virus.

In Depth: Epidemic Poses Existential Threat to Small Businesses – Caixin

Even before the outbreak, many small businesses were already grappling with shrinking sales as China’s economy logged some of its slowest growth in decades. With business now at a standstill during the outbreak, many are facing existential liquidity crises. Large numbers say they are having difficulties just paying salaries, adding they can only survive for a matter of months using their current resources, even if Beijing provides support…

A survey (link in Chinese) of 995 small and midsize companies conducted by Tsinghua University and Peking University after the outbreak began showed the vast majority couldn’t survive for more than three months with their current savings. About a third said they could survive for only one month, another third said they could survive for two months, and 17.91% said they could last three months.

Coronavirus outbreak spells trouble for China’s banks | Financial Times $$

A prolonged crisis in which factories and shops are unable to do business would add as much as Rmb5.6tn in new bad debt for lenders, trebling non-performing loans, according to S&P Global Ratings, as companies struggle with repayments.

Bad debt across the banking system could rise from less than 2 per cent at the end of last year to 6.3 per cent of total assets, S&P research shows — a level not seen for two decades.

Coronavirus: dim sum off the menu as Guangzhou bans eating in restaurants | South China Morning Post

The ban on dining in applies to restaurants, but employees can continue to have meals at their company canteens. And while residents can still get takeaways from restaurants, they have been encouraged to do this online, and have their meals delivered, rather than collecting their orders.

Alibaba Earnings: Coronavirus Threatens Growth of Core Businesses – Bloomberg

Chief Financial Officer Maggie Wu told investors that the company’s China retail and local consumer businesses would be hit hardest. Both will bear the brunt of reduced demand and the challenge of delivering products. Customer management revenue and commissions will most likely decline, she said…

Chief Executive Officer Daniel Zhang described the epidemic and resulting widespread quarantine as a Black Swan event. The message: This will hurt, but it will be a one-off.

China Park Operator Warns of Cashflow Woes as Virus Shuts Gate – Bloomberg via Yahoo

A Chinese national park operator risks becoming the first high-profile victim of the coronavirus outbreak in the country’s nascent asset-backed securities market, warning against a weakening ability to generate cashflows.

Slender West Lake Tourism Development Group Co., which runs a top-rated national park in the eastern city of Yangzhou, said a statement Wednesday that the epidemic is having a negative impact on its 2.2 billion yuan ($320 million) asset-backed notes.

China Shoots Set to Resume Despite Continued Coronavirus Threat – Variety

Hengdian World Studios, one of China’s largest, cautiously reopened for business today after it shut down all production in recent weeks to prevent the spread of the deadly coronavirus.

She’ll be right.

David Llewellyn-Smith
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