The restrictions on business and social activity affected 9.2% of China’s gross domestic product as of Thursday, up from 7% on Oct. 16, according to Nomura’s model.
“Since the 20th National Party Congress kicked off on 16 October, domestic Covid case numbers have been clearly on an upward trajectory,” the firm’s chief China economist Ting Lu and a team said in a report Thursday. “The national lockdown situation has been getting … significantly worse.”
For Thursday, mainland China reported 214 Covid cases with symptoms and 1,123 without. The infections were reported in well over 20 of China’s 31 province-level regions.
Among the many outbreaks nationwide, infections in the capital city forced Universal Beijing Resort to close temporarily starting Wednesday. It was unclear if the resort would re-open in time for Halloween weekend.
However, many of the recent case clusters and ensuing Covid controls have occurred in less economically prominent parts of the country, such as areas within Qinghai and Xinjiang in the northwest.
The Nomura report also pointed out that some localities have not directly announced lockdown measures, making it difficult to assess the impact.
Little change on Covid after China’s big meeting
In a speech at the start of the ruling Chinese Communist Party’s 20th National Congress, President Xi Jinping did not say whether the Covid policy would end or continue. Analysts noted the meeting focused more on personnel changes rather than specific economic policy.
The congress ended Oct. 22. The next day, China announced the party’s new core leadership team would include many Xi loyalists.
The Nomura analysts said they expect China’s stringent Covid controls will remain at least until March, “when the political reshuffle will be fully completed and the new leaders fully take over the cabinet.”
Fourth-quarter growth calls
In a separate note, Nomura analysts maintained their fourth-quarter GDP growth forecast of 2.8% from a year ago.
China’s National Bureau of Statistics said Monday that third-quarter GDP grew by 3.9% from a year ago.
On Wednesday, Premier Li Keqiang headed a State Council meeting that called for promoting a pickup in growth in the fourth quarter, from the third, state media said.
— CNBC’s Arjun Kharpal contributed to this report.
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