China to go ahead with key meeting on economic policy despite surge in Covid cases

Chinese leaders will proceed with a closely-watched economic policy meeting in Beijing this week. China has opted not to postpone the gathering despite a surge in Covid infections. Ahead of the meeting, reports emerged saying that the Biden administration plans to place Chinese chip maker Yangtze Memory Technologies (YMTC) and 35 other Chinese firms on a trade blacklist that would prevent them from buying certain American components.

The US Department of Commerce will add the Chinese companies to a so-called Entity List as early as this week, the report said, citing a person familiar with the matter.

The conference, where officials debate policy goals for the upcoming year, was scheduled to start on Thursday. Members of the Politburo, provincial governors, and the leaders of governmental organisations and financial institutions, in addition to Xi, are present at the meeting. In the past, the summit would span three days, with a readout being released in official media at the conclusion.

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This month, China abruptly put an end to its stringent Zero-Covid pursuit by abandoning many curbs,frequenttesting and isolating sick patients. There are already indications that the virus is spreading quickly, notably in Beijing where there are long hospital wait times and a rising lack of fever-treating medications. Beijing's fever clinics had 22,000 patients on Sunday, 16 times more than the previous week, according to a report from the official broadcaster CCTV, quoting Li Ang, a local health commission spokeswoman.

An inquiry via fax for comment was not immediately answered by the State Council Information Office.

Economists had expected authorities to suggest broader fiscal and monetary policy as well as more easing in the real estate market support growth, but the abrupt about-face has added more uncertainty to an already precarious economic picture.

Typically, the conference would also include a target for the economy's growth for the next year, but it won't be made public until the annual parliamentary gathering in March.

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The new Politburo of the Communist Party, which was assembled with Xi's loyalists after he won a third term in office in October, set the tone for the meeting last week by making a clear turn in favour of supporting growth. Senior authorities are contemplating a growth target of approximately five per centfor the coming year, according to a report from Bloomberg News last week.

Following a Politburo meeting, the CEWC is often convened.

According to analysts surveyed by Bloomberg, the economy would expand at a meagre 3.2 per centthis year, the smallest rate since the 1970s, barring the pandemic dip in 2020.

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