CHINA'S ZERO TOLERANCE STRATEGY DURING THE COVID-19 PANDEMIC
Abstract
The situation of the pandemic has put the world community before the choice of forms and methods of combating coronavirus, while balancing the interests of the economy, healthcare and society as a whole. Until now, a unified approach to the use of restrictive measures has not been formed in the world. China's non-standard experience is extremely interesting to study. The article reveals the essence and influence of the zero-tolerance strategy in the COVID-19 period events on the Chinese economy. The macroeconomic indicators of GDP, unemployment, inflation in comparison with other countries of the world are analyzed. A comparison of data on the incidence of COVID-19 in various states was carried out. It was revealed that the zero strategy for combating coronavirus infection provides for strict lockdowns against both infected and the entire area of residence. A more democratic strategy provides for the isolation of the patient and his direct contacts. China's policy is focused on the task of non-proliferation of the epidemic while ignoring the negative effects on the country's economy. The macroeconomic dynamics of the country's indicators during the pandemic worsened under the influence of not only the systemic global crisis, but also because of tough anti-coronavirus measures. This situation is a consequence of the change in the priorities of China's long-term policy – from purely economic to social. At the same time, the zero-tolerance strategy proves its high medical effectiveness in terms of morbidity of the population.
Introduction
The unprecedented events of the COVID-19 pandemic had challenged the world community to choose the forms and methods of response to health threats. The World Health Organization, based on information from permanent monitoring, has offered its recommendations to prevent the spread of infection. However, the restrictive measures introduced in various countries ranged from complete lockdowns to relatively lax hygiene recommendations (as in Sweden) [Public Health Agency, 2022]. Decisions on the composition and application of restraints had to take into account their impact not only on health but also on the economy as a whole. The restrictions were temporary and varied according to the epidemiological situation. However, in most countries (such as Russia), the measures followed a trajectory from lockdown to the almost complete abolition of all restrictions, and somewhere, as in the People’s Republic of China (China), adopted a zero-tolerance strategy to combat COVID-19, which is still held to this day.
“Zero COVID” strategy involves searching, testing, tracking, isolating not only infected, but also persons potentially contacted someone with COVID. The main objective of such a program in public health is to reduce to zero the probability of new cases of infection, and only after that to return to normal socio-economic activity. The program includes two phases:
- initial stage is local suppression of the virus;
- next stage is sustainable deterrence with the full resumption of social and economic life.
The strategy of “zero COVID” during the pandemic was chosen by the countries of the Pacific-Asian region, as well as some countries of Europe (for example, Scotland). The flagship of this strategy is the People’s Republic of China, which demonstrates strict measures to combat the spread of the virus of the “omicron” strain even to the detriment of national economic interests.
The purpose of the study is to provide a comparative analysis of strategies to counter the coronavirus infection, to identify conservative and democratic ones, and to differentially assess their impact on social, economic, and medical parameters.
The study has been conducted using data published in the public press, official data of the World Health Organization, the International Monetary Fund. Statistical data formed by Russian specialized organizations, placed on Internet sites and portals has been used. General scientific methods, such as analysis, comparison, generalization, grouping, etc., were used to solve research tasks, as well as methods of statistical and economic calculations.
Main part
Measures to respond to a pandemic situation are distinguished as obligatory and optional. The former include quarantine and hygiene measures, the development of treatment principles, testing and public awareness. The latter include the development and production of a vaccine, genetic surveillance, the prioritization of population groups, the formation of a new model of social behaviour [Shkarin V.V., Soboleva S.Yu., Sobolev A.V., Dneprovskaya I.V., Ivasheva V.V., 2021].
Depending on the severity of the obligate quarantine measures and restrictions on the mobility of the population, according to the authors, the strategies are different as conservative and democratic. The conservative zero strategy provides for significant restrictions on the movement of potentially affected populations and their isolation if even one person is infected in a given area. Japan, Australia, Vietnam, Hong Kong, South Korea have chosen such measures together with China. The democratic strategy provides for isolation of the infected patient and more lenient restrictions for contact persons. Similar measures are followed by the countries of the European Union, Russia, the former CIS (Commonwealth of Independent States) countries, and the United States.
We can say that the focus of the conservative strategy is the health of the population, reducing morbidity and mortality, it is aimed at stopping the spread of infection, the economic consequences of restrictions are not taken into account. The democratic strategy is trying to strike a balance, covering the effects of both health indicators and the economy. At the beginning of the pandemic, the global community as a whole chose a conservative strategy, countries introduced lockdowns one after another, which quickly led to significant problems in industries dependent on customer flow (tourism, restaurants, etc.), and then spread to some other industries. However, after the restrictions were lifted, there was also a fairly rapid recovery in economic indicators in many sectors, despite the fact that many countries applied additional state support measures. [Lomovtseva O.A., Soboleva S.Yu., Sobolev A.V., 2021].
At present, only China remains consistent in its adherence to stringent measures against the COVID-19 pandemic. Despite the decline in the main economic indicators, the People’s Republic of China continues its anti-conspicuous activities on a full scale, focusing primarily on medical safety. Of course, an extensive pool of statistical and other information is needed to assess the validity of such measures, which is not entirely possible at present.
At the same time, the impact of stringent measures on the economy, society and the health-care system cannot be ignored, because the current crisis, which has led to a decline in all basic economic indicators, updates this assessment. In addition to the pandemic, there are a number of negative foreign policy factors in 2022, so the analysis should take into account the multi-factor effects of strategies to counter the pandemic.
Returning to the issue of China, we note that in terms of the number of cases and deaths, the country lags far behind all countries, even though it was the first to take the hit of the pandemic. And now all outbreaks of disease are being severely suppressed.
Let us present some key economic indicators by country and compare their dynamics. When comparing selected economic indicators for the countries of China, the USA, Russia and the Eurozone, the following can be seen.
The United States, China and Russia showed a drop in GDP growth rates in the second quarter of 2022. US GDP data indicates that the US economy is entering a recession. Russia's GDP growth is slowing down as the country is increasingly suffering from sanctions restrictions. The Eurozone showed a fall of 0.1% (see Table 1).
Таблица 1
ПоказателитемповростаВВП, в %
Table 1
Indicators of GDP growth rates, %
No. | Regions of the world | GDP growth rate, Q1 2022 | GDP growth rate, Q2 2022 |
1. | Eurozone | 0.8 | 0.7 |
2. | China | 4.8 | -2.6 |
3. | USA | 0.6 | -1.6 |
4. | Russia | 3.5 | -4.1 |
Compiled by authors according to [China – economic indicators, 2022; Tables of the inflation rate, 2022]
China’s GDP growth rate fell by 2.6%. The International Monetary Fund (IMF) worsened China’s 2022 GDP growth forecast to 3.3%. Interestingly, experts attribute this not only to the current problems of the global economy, but also to the new lockdowns and the worsening real estate crisis in China [The IMF has worsened the forecast, 2022; GDP (in current US dollars) - Russian Federation, 2022; The congress is the congress, 2022]. Negative trends continue despite the significant contribution to the country’s GDP (more than 16%) of economic clusters with local infrastructure and in the competitive phase [Buruk A.F., Ubozhenko E.V., 2019; Lomovtseva O.A., Soboleva S.Yu., Sobolev A.V., 2021].
Data on the level and dynamics of unemployment indicators show relative stability of values: the unemployment rate decreased by 0.1% in the Eurozone and increased by 0.2% in the USA (see Table 2).
Таблица 2
Уровень безработицы в регионах мира, в %
Table 2
Unemployment rate in the regions of the world, %
No. | Regions of the world | Unemployment rate, | Unemployment rate, |
1. | Uurozone | 6.7 | 6.6 |
2. | China | 5.4 | 5.3 |
3. | USA | 3.5 | 3.7 |
4. | Russia | 3.9 | 3.9 |
Compiled by authors according to [China – economic indicators, 2022]
Inflation and price growth indicators (see Table 3) show significant growth in the US and the Eurozone, and in Russia, in particular, are characterized by double-digit values [Tables of the inflation rate, 2022]:
- inflation in Russia in 2021 was 6.69% in August and 7.41% in September; in 2022 was 15.1% in August and 14.3% in September;
- in China, inflation in 2021 was 0.9%, and in 2022 it exceeded the 2% threshold;
- in the United States, inflation rose by more than 8% in annual terms in 2022, and by 2021 it was 4.7%.
Consideration of inflationary processes in the Eurozone seems to be a rather difficult task, as the indicators vary considerably among countries:
- the worst indicators in Estonia (25.2% in August 2022, in 2021 in the same month - 5.0%);
- the best situation is in France (2.4% in August 2021 and 6.5% in August 2022).
On average, inflation in the Eurozone in June 2021 was 2.2%, and in 2022 already 8.9% [Tables of the inflation rate, 2022].
Таблица 3
Уровень инфляции, квартал к кварталу 2022 год в %
Table 3
Inflation rate, quarter to quarter 2022, %
No. | Regions of the world | Inflation rate, August 2022 | Inflation rate, September 2022 |
|---|---|---|---|
1. | Eurozone | 8.9 | 9.1 |
2. | China | 2.7 | 2.5 |
3. | USA | 8.5 | 8.3 |
4. | Russia | 15.1 | 14.3 |
Compiled by authors according to [Tables of the inflation rate, 2022; China – economic indicators, 2022]
Table 3 shows a 2-4-fold increase on average in inflation for all the regions under review. Significant growth in the Eurozone and the US suggests that the global inflationary processes have also affected the advanced economies, not only Russia and developing countries.
Along with the pandemic, US and EU sanctions are also exacerbating the deteriorating indicators, which have led to negative economic effects not only for Russia, but also for the countries that initiated the sanctions. The synergy of negative results is reflected in the growth of inflation, the energy crisis of the Eurozone, the disruption of economic contacts between the EurAsEC and Eurozone countries. In this situation, China is in a better position to benefit from the financial and logistical restructuring of the world economy, but the COVID-19 zero-tolerance strategy and the continuous lockdowns, as well as accumulated real estate debt in the banking system, prevent China to take full advantage of economic advantages [China and the United States are measured by crises, 2022].
China currently reports approximately 166 infections per day (see Table 4). Other countries, where the number of cases per day is estimated at several tens of thousands (for example, in the USA - 63035, the Eurozone - 83517), continue to use a democratic strategy and do not impose strict restrictions that impede economic interactions.
Таблица 4
Показатели заболеваемости на 21.09.2022 г.
Table 4
Morbidity rates as of 21 September 2022
No. | Regions of the world | Number of infected per day, people |
1. | Eurozone | 83517 |
2. | China | 166 |
3. | USA | 63035 |
4. | Russia | 53045 |
Compiled by authors according to [Coronavirus in China, 2022; Coronavirus. Statistics of coronavirus, 2022]
Such differences indicate that the Chinese authorities are mainly concerned about the spread of the virus and the increase in the incidence, and to a lesser extent about the impact of anti-COVID measures on economic performance. It also suggests that the resilience achieved by China's economy over the years and the exit of world leaders is allowing the authorities to deliberately take some financial risk.
As a result of a combination of actions, we can state the following significant results in reducing the number of infected people, in which China is many times superior to all compared countries, and the specific features of the healthcare organization in China:
- a combination of traditional Western and Eastern approaches to treatment and diagnosis;
- a relatively small budget for financing the industry (about 5% of GDP) compared to the developed countries of the Eurozone (10% of GDP or more) [Sarah Thomson, Thomas Foubister, Elias Mossialos, 2022];
- low levels of provision with paramedical personnel: 2.94 registered nurses per thousand people [15]; according to data for 2020, there are 18 doctors per 10 thousand people in China, 37 in Russia, 42 in Germany, and 54 in Sweden [The Ministry of Health named the regions, 2022; The number of doctors in different countries, 2022];
- low bed capacity: 6.03 per thousand in 2018, compared with 6.8 in Russia. 4.34 in 2020 [Proposals for urgent measures in the healthcare of the Russian Federation, 2022; The number of hospital beds per 1000 people in different countries, 2022].
These features of Chinese health care are in part a legacy of the command-and-control economy, but even underfunding, the relatively small number of health workers and hospital beds have not been an obstacle to success in the fight against COVID-19. The implementation of the conservative zero-tolerance strategy during the pandemic period, however, has had a positive impact on the social and medical performance of the health sector.
Conclusion
The Chinese health-care model, which pursues a conservative strategy to prevent the spread of coronavirus infection, contributes to slowing the economic growth of the national economy, while effectively performing a healthy function. However, the world community, which was closely monitoring China’s GDP decline in the third quarter of 2022, was gravely concerned about that situation, which could lead to a recession and aggravate the world economy.
The spread of the COVID-19 pandemic has put health executives in different countries facing ethical choices: social (human preservation) or economic (GDP growth) expediency. Recall that even in Europe, during the period of severe restrictions, the population demanded their removal and the restoration of enterprises, jobs, people assessed economic risks higher than health risks. In order not to disrupt the functioning of the economy, support measures for various industries, enterprises and different categories of citizens were used in almost all countries. Most States have now changed their sanitation policy, but China remains a consistent advocate of the strictest containment. How this will affect the Chinese economy in the future is difficult to predict, especially with the current combination of factors in the global environment, but it is certain that the incidence in a densely populated country has remained stable over the past year at a critically low level, which, of course, speaks to the effectiveness of the zero-tolerance strategy.
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