COVID-19 on the way out – Is everything back to normal?
In Wuhan, things changed suddenly with the onset of COVID-19 about eight months ago. Life in China came to a standstill and the government forced the closure of just about every shop and type of entertainment; travel in and out as well as within the country was banned and “lockdown” took on new meaning – it became a way life. Wuhan, for example, was on strict lockdown for a non-stop 76 days.
Now, in late August 2020, the night markets and wet markets in Wuhan are once again teeming with activity. People are shopping and getting close to each other and no one seems worried – check out the crowds of thousands at a swimming party recently.
Thousands crowd together at Wuhan pool party while not wearing masks
In Shanghai you can enjoy a night of entertainment at the local movie theater, dinner out with friends, and many students are headed back to campus for the fall semester. In Qingdao, the annual beer festival is underway with no mask needed! Factories are operating again, and people are back to work. But the government is still careful with temperature checks required to get into certain restaurants, banks and other public places.
Things are looking brighter…and why not?
Local virus transmission is now near zero and air travel within China is almost back to normal. This comes with many government-backed promotional deals and tours to encourage travel. According to recent data released by Forward Keys (they track global travel), airline bookings in China are now at about 98% of levels reached in 2019. This is in stark contrast to what’s happening to the airline industry here and in most parts of the world with massive pilot and employee layoffs in progress. But the government is still being careful. Foreigners are currently not allowed to enter China for fear they will bring the virus with them.
The government claims it was the lockdowns and strict tactics like testing drives that resulted in the success of getting the virus under control and allowed the reopening of the country (and the economy) ahead of other world powers.
US & China Relations – Underlying Tension and Problems Persist
It appears that commerce is opening up as both American and Chinese officials claim to be committed to ensuring the success of Phase One of the trade deal reached last January. China is on record to buy 40 million tons of soybeans this year – 25% more than in 2017, the baseline year for the trade deal, although some experts familiar with the situation doubt they will reach this target.
On the surface Phase One appears to be somewhat on track, but there is significant underlying tension in other areas. Here are just a few of the issues:
President Trump continues to blame China for not keeping Covid-19 from becoming a pandemic and wants to punish Beijing.
The matters of intellectual property rights and forced technology transfer have not been resolved to anyone’s satisfaction.
The recent suggested ban to bar Chinese-owned TikTok (ByteDance Ltd.) and WeChat (Tencent Holdings Ltd.) in the USA is problematic. U.S. firms operating in China such as Ford Motor Co. and Apple, Inc. (to name just two of many), are worried that the ban could also apply to doing business in China which would hurt their operations significantly.
Recent closure of Chinese consulates in the USA due to a suspected intelligence-gathering operation by Chinese researchers (affiliated with the Chinese military) from universities throughout the USA, supported by Chinese diplomats in the USA.
Ongoing sovereignty issues involving Hong Kong and Taiwan.
In light of the upcoming presidential election, it will be interesting to see how things play out. Trump is taking a tough stance on specific issues yet at the same time fostering hope for Phase One of the trade deal to keep American farmers happy before the election.
