SEOUL, June 17 (Reuters) – North Korean leader Kim Jong Un and other senior officials prepared aid to send to 800 families suffering from an unidentified intestinal epidemic, state media reported on Friday, as the country also battles its first COVID-19 outbreak.
North Korea revealed this week it was facing an “acute enteric epidemic” on top of a weeks-long outbreak of COVID. It did not elaborate what the disease was, but enteric refers to the gastrointestinal tract.
“The officials … prepared medicines, foodstuff and daily necessities needed for the treatment of the epidemic and stable life to render aid to the people in Haeju City and Kangryong County (of South Hwanghae Province),” the Korea Central News Agency (KCNA) said.
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Leader Kim called upon officials “to fulfil their duty in the work for easing the people’s misfortune and sufferings as soon as possible,” it added.
North Korean leader Kim Jong Un sends home-prepared medicines to the Haeju City Committee of the Workers’ Party of Korea (WPK) in this photo released by the country’s Korean Central News Agency on June 16, 2022. KCNA via REUTERS
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On Thursday, an official at South Korea’s Unification Ministry handling inter-Korean affairs said Seoul is monitoring the outbreak, suspected to be cholera or typhoid.
South Hwanghae Province is North Korea’s key agricultural region and the outbreak raised concerns may add to chronic food shortages amid the wave of COVID-19 infections. read more
North Korea has been reporting patient numbers with fever symptoms, rather than confirmed COVID cases, potentially due to a lack of testing ability.
KCNA on Friday reported 23,160 more people with fever symptoms, bringing the total number in the country since late April to above 4.58 million. The death toll linked to the outbreak is at 73.
The North has said more than 99% of fever patients have recovered and that the COVID wave has shown signs of subsiding, but the World Health Organization cast doubts on Pyongyang’s claims earlier this month, saying it believes the situation is getting worse. read more
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Reporting by Joori Roh; Editing by Lincoln Feast.
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Cans of Enfamil baby formula, produced by Mead Johnson, on partially empty shelves in a Target store, amid continuing nationwide shortages in infant and toddler formula, in San Diego, California, U.S., May 25, 2022. REUTERS/Bing Guan
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LONDON, May 30 (Reuters) – The U.S. baby formula crisis has boosted profits at Britain’s Reckitt Benckiser and helped it grab the top spot in a $5.8 billion-a-year market. The challenge now will be to stay there.
With the business reportedly up for sale, there’s even more at stake.
Reckitt (RKT.L) has ramped up production of its Enfamil formula since U.S. rival Abbott Laboratories (ABT.N) in February recalled dozens of products in the United States after customers complained of infants contracting bacterial infections.
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The British consumer goods company, which boosted formula production by 30%, told Reuters last week it now accounted for more than 50% of total baby formula supply in United States, up from around a third before the crisis. read more
Parents tend not to switch brands their infants like. A Reckitt spokesperson said the company was hoping to hold on to customers it has gained while Abbott products, such as Similac, are off the shelves.
The company said this week it was feeding 211,000 more babies than before the recall.
The stakes are high. Reckitt has reportedly long been looking to sell the formula business to focus on its higher margin household and consumer brands that range from Dettol disinfectants to Durex condoms. The Wall Street Journal said on Friday it was making a renewed sale attempt, and could fetch around $7 billion.
But the boost from the U.S. crisis may not last long.
The U.S. Food and Drug Administration (FDA) said on May 19 Abbott was on track to reopen its key baby formula plant in Michigan within one or two weeks, although FDA Commissioner Robert Califf told lawmakers a week later it would take until July before store shelves across the country were filled.
While Abbott’s recall has presented an opportunity for other firms, such as Gerber maker Nestle (NESN.S) and Neocate maker Danone (DANO.PA), it is Reckitt that is benefitting most, as it was already No.2 to Abbott before the crisis.
On April 1, Barclays raised its 2022 organic sales forecast for Reckitt to 4.4% from 4.0%, including an uplift to 7.4% from 5.0% at its nutrition division, which includes baby formula.
Less than five weeks later, it hiked its forecasts again to 6.0% for the group and 12.4% for the nutrition division.
According to Refinitiv, analysts have on average raised their full-year earnings forecast for Reckitt by 4.35% in the past 30 days, to about 311 pence per share.
“Near term, the biggest financial impact is going to be on Reckitt,” said Barclays analyst Iain Simpson. “The big question is how much of the recent market share gains Reckitt holds on to once Abbott is back on shelf.”
WILL IT LAST?
On its own, the sales hike would result in increased profits. But margins have been further boosted by the United States saying it will temporarily cover the cost of baby formula for low-income families dependent on government discounts in states contracted with Nestle and Reckitt. read more
Companies normally bid for state contracts to be the sole provider of baby formula for low-income families under the Women, Infants and Children (WIC) programme. In their bids, they offer a “rebate”, in the form of discounts, to the states.
The government’s intervention, aimed at incentivising firms to boost supplies, effectively covers that rebate.
Reuters Graphics
“Financially, it’s great both for the top-line and profitability because they don’t need to give a rebate to the state government for selling formula,” Bernstein analyst Bruno Monteyne said. “It probably will add at least 20-30 basis points of higher margins for as long as this lasts.”
Barclays’ Simpson agreed not being bound by a WIC contract would be a boost, estimating they have a 5% EBIT (earnings before interest and tax) margin versus about 40-45% for non-WIC contracts.
But some analysts say this boost is likely to be temporary, and Reckitt may not be able to keep its new customers.
While Bernstein’s Monteyne said there was “some truth” to the idea Reckitt could benefit longer-term from the damage to Abbott’s reputation, he noted the U.S. firm overcame a similar backlash from a 2010 formula recall within just a year.
“There is decent precedent,” he said.
Reckitt shareholder Waverton Investment Management also suspects the market share gain will prove short-term.
“The U.S. is looking for other sources already to fill demand,” said Waverton fund manager Tineke Frikkee said. “Over time Abbott will get their formula back on the shelves and Reckitt will revert to normal market share.”
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Reporting by Richa Naidu
Additional reporting by Leah Douglas
Editing by Matt Scuffham and Mark Potter
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May 17 (Reuters) – Abbott Laboratories (ABT.N), the biggest U.S. supplier of powder infant formula including Similac, has agreed with regulators on steps needed to resume production at its Sturgis, Michigan, manufacturing plant.
Abbott initiated a recall of its infant formula products and closed its Michigan plant in February after reports of serious bacterial infections in four infants, worsening a shortage among multiple manufacturers that began with pandemic supply chain issues. Here are some details about what has happened:
WHY DID ABBOTT INITIATE A RECALL AND PLANT SHUTDOWN?
Consumers reported four infants who were sick, including three with Cronobacter sakazakii infections and one with Salmonella newport, who had been fed formula products made at the Sturgis plant. A fourth infant with cronobacter sakazakii was later added to the investigation by the U.S. Centers for Disease and Control Prevention (CDC).
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Cronobacter sakazakii can cause life threatening sepsis infections or meningitis and may have contributed to the death of two of the infants, the U.S. Food and Drug Administration has said.
WHAT WAS RECALLED?
The recall began in mid-February with dozens of types of Similac, Alimentum and EleCare powdered formulas. A specialty liquid formula called Similac PM 60/40 was added to the recall at the end of February.
DID THE FDA OR CDC FIND A LINK?
Abbott says there is no evidence to link its formulas to these illnesses. The FDA and the CDC have not disclosed any information that connects the illnesses and the plant. FDA officials said that the investigation was impeded by having only two of the four sickened babies’ clinical samples.
The CDC analyzed clinical samples from two of the infants and did not find a genetic match to the environmental strains found at the plant. It also said the bacteria from the patient samples were not closely related to one another.
The FDA and Abbott tested environmental and product samples at the plant. They found five environmental samples containing Cronobacter sakazakii. The product samples tested negative.
WHEN WILL THE ABBOTT PLANT RESUME PRODUCTION?
Abbott, as part of a pre-negotiated injunction filed by the FDA, has agreed to take corrective actions to address issues raised by federal inspectors in order to restart the plant. It will retain an independent expert to ensure the facility is in compliance with the law.
Once the FDA confirms that the initial requirements have been met, Abbott said the site could be restarted within two weeks.
Peter Pitts, president of the Center for Medicine in the Public Interest and former FDA associate commissioner, said Abbott should be able to meet its two weeks target for re-opening the facility, and expects it to be fully operational in another four-to-six weeks.
Abbott has imported millions of cans of infant formulas from its Ireland facility to help with the U.S. shortage. The recall affected formula shipped to other countries, including Israel.
HOW LONG WILL IT TAKE FOR THE SHORTAGE TO SUBSIDE?
The shortages may last another two to four months even as lawmakers and the White House try to increase supplies. Abbott has said it will take six to eight weeks to get formula on shelves after the facility restarts.
WHAT CAUSED THE SHORTAGE?
The shortage began in 2020 as consumers stockpiled due to COVID-19 lockdowns. Formula makers ramped up production but then cut back in 2021 as demand slowed. Global shipping logjams have also prevented retailers from promptly restocking shelves.
(This story corrects to drop “Dr” title before Peter Pitts’ name in paragraph 11)
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Reporting by Manas Mishra, Leroy Leo and Deborah Sophia in Bengaluru and Richa Naidu in London; Editing by Caroline Humer, Sandra Maler and Bill Berkrot
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LONDON, May 17 (Reuters) – Top baby formula makers Reckitt Benckiser (RKT.L) and Nestle have ramped up supplies to the United States to resolve a shortage that has emptied shelves and caused panic among parents.
Baby formula aisles at U.S. supermarkets have been decimated since top U.S. manufacturer Abbott Laboratories (ABT.N) in February recalled formulas after complaints of bacterial infections.
Abbott said on Monday it had reached an agreement with the U.S. health regulator to resume production of baby formula at its Michigan plant, marking a major step towards resolving the nationwide shortage. read more
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In the meantime, other baby formula makers have stepped up production and shipped extra supplies to the United States.
Reckitt Benckiser is boosting baby formula production by about 30% and making more frequent deliveries to U.S. stores, an executive told Reuters on Tuesday. read more
The company, which makes its U.S. formula in three facilities in Michigan, Indiana and Minnesota, has granted plants “unlimited overtime” to put in extra shifts, Robert Cleveland, senior vice president, North America and Europe Nutrition at Reckitt, told Reuters in an interview.
Empty shelves show a shortage of baby formula at a CVS store in San Antonio, Texas, U.S. May 10, 2022. REUTERS/Kaylee Greenlee Beal/Files
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Prior to the Abbott recall, Reckitt supplied just over a third of the U.S. infant formula market compared with Abbott’s roughly 44%. Britain-based Reckitt told Reuters it now accounts for more than 50% of total baby formula supply in the country.
“We normally might pack an entire truck before we ship it. For timeliness, we’re not doing that. We’re packing it with as much product as we have and then we’re just getting it out the door,” Cleveland said.
The United States will allow baby formula imports from foreign makers that do not usually sell their products there, the Food and Drug Administration said on Monday. read more
Nestle is flying baby formula supplies to the United States from the Netherlands and Switzerland, the company said in an emailed statement to Reuters on Tuesday. L2N2X90E1
The world’s largest packaged food group is moving Gerber baby food formula to the United States from the Netherlands and Alfamino baby formula there from Switzerland, it said.
“We prioritized these products because they serve a critical medical purpose as they are for babies with cow’s milk protein allergies,” the company said. “Both products were already being imported but we moved shipments up and rushed via air to help fill immediate needs.”
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Editing by Matt Scuffham and Mark Potter
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As the rest of the world learns to live with Covid-19, China’s top leader, Xi Jinping, wants his country to keep striving to live without it — no matter the cost.
China won a battle against its first outbreak in Wuhan, Mr. Xi said last week, and “we will certainly be able to win the battle to defend Shanghai,” he added, referring to the epicenter of the current outbreak in China.
summarized it as “zero movement, zero G.D.P.” Multinational companies have grown wary of further investments in the country.
For more than two years, China kept its Covid numbers enviably low by doggedly reacting to signs of an outbreak with testing and snap lockdowns. The success allowed the Communist Party to boast that it had prioritized life over death in the pandemic, unlike Western democracies where deaths from the virus soared.
More transmissible variants like Omicron threaten to dent that success, posing a dilemma for Mr. Xi and the Chinese Communist Party. Harsher lockdowns have been imposed to keep infections from spreading, stifling economic activity and threatening millions of jobs. Chinese citizens have grown restless, pushing back against being forced to stay home or to move into grim, government-run isolation facilities.
politically important year for Mr. Xi, China’s censors have moved quickly to muffle calls for a change in course on Covid-19. The head of the World Health Organization, whose recommendations China once held up as a model, was silenced this week when he called on the country to rethink its strategy.
Photographs and references to Tedros Adhanom Ghebreyesus, the director general of the W.H.O., were promptly scrubbed from the Chinese internet after the statement. The foreign ministry responded by calling Mr. Tedros’s remarks “irresponsible,” and accusing the W.H.O. of not having a “proper understanding of the facts.”
China’s state-controlled media has also glossed over the draconian measures officials have deployed to deal with outbreaks. This week, as some authorities in Shanghai erected new fences around quarantine zones, boarded up more homes and asked residents not to leave their apartments, state media painted a picture of a city slowly returning to normal.
One article described the “hustle and bustle of city life” returning, while another focused on statistics for how many stores had reopened.
has not happened. Several Chinese companies are in the testing phase of a homegrown mRNA option, and China also recently approved for emergency use a Covid-19 antiviral pill made by Pfizer called Paxlovid.
Administering three vaccine shots, using antiviral therapies and offering more effective vaccines could help China find a path out of zero Covid, Mr. Ajelli said.
disappointing winter wheat harvest in June could drive food prices — already high because of the war in Ukraine and bad weather in Asia and the United States — further up, compounding hunger in the world’s poorest countries.
A pause on wealth redistribution. For much of last year, China’s top leader, Xi Jinping, waged a fierce campaign to narrow social inequalities and usher in a new era of “common prosperity.” Now, as the economic outlook is increasingly clouded, the Communist Party is putting its campaign on the back burner.
By one estimate, nearly 400 million people in 45 cities have been under some form of lockdown in China in the past month, accounting for $7.2 trillion in annual gross domestic product. Economists are concerned that the lockdowns will have a major impact on growth; one economist has warned that if lockdown measures remain in place for another month, China could enter into a recession.
European and American multinational companies have said they are discussing ways to shift some of their operations out of China. Big companies that increasingly depend on China’s consumer market for growth are also sounding the alarm. Apple said it could see a $4 billion to $8 billion hit to its sales because of the lockdowns.
struggle to find and keep jobs during lockdowns.
Even as daily virus cases in Shanghai are steadily dropping, authorities have tightened measures in recent days following Mr. Xi’s call last week to double down. Officials also began to force entire residential buildings into government isolation if just one resident tested positive.
The new measures are harsher than those early on in the pandemic and have been met with pockets of unrest, previously rare in China where citizens have mostly supported the country’s pandemic policies.
In one video widely circulated online before it was taken down by censors, an exasperated woman shouts as officials in white hazmat suits smash her door down to take her away to an isolation facility. She protests and asks them to give her evidence that she has tested positive. Eventually she takes her phone to call the police.
“If you called the police,” one of the men replies, “I’d still be the one coming.”
Isabelle Qian contributed reporting, and Claire Fu contributed research.
Wall Street has been quick to shift its Covid-19 protocols after New York State dropped its indoor mask mandate last month. At JPMorgan Chase, masks are now voluntary for vaccinated and unvaccinated employees, and the firm will discontinue mandatory Covid testing as well as the reporting of Covid infections by April 4. At Morgan Stanley, where vaccines are required to enter the office, the mask requirement was dropped early last month.
Goldman Sachs dropped mask requirements on Feb. 14, though it still requires testing. Citigroup dropped its mask requirement last week. Wells Fargo has maintained more rigid Covid protocols than some of its finance peers, requiring unvaccinated employees to wear a mask at all times unless they are eating, drinking or alone in an enclosed room.
Other industries that have made a push for in-person work, such as real estate, have also reformulated their Covid guidelines in recent weeks. BlackRock, which has asked its 7,600 U.S. employees to return to the office at least three days a week, no longer requires masks in its U.S. offices, though employees have to be vaccinated to enter the building and are asked to test twice a week. Prologis, a logistics real estate firm, said its office mask guidelines were consistent with local regulations. Guardian Life Insurance, which has about 6,300 U.S. employees, does not have an in-office mask requirement in most areas of the country.
Still, some tech companies are holding firm on Covid safety protocols. Google requires any unvaccinated employees with approval to enter its offices to test regularly and wear a mask. Meta, the parent company of Facebook, requires anyone entering the office to be vaccinated — including with a booster starting March 28 — and follows local guidelines on masking.
Intuit announced on Wednesday that starting on May 16, its 11,500 U.S. employees would return to the office in a hybrid model, in which teams determine how many days per week workers should be in person. While the company requires anyone entering its offices to be vaccinated, it follows local and state guidelines on masking, meaning masks are not required in any of its U.S. offices.
“We’ve tried to stress that people should feel comfortable doing whatever feels best for them,” said Chris Glennon, Intuit’s vice president of global real estate and workplace. “We are seeing some folks masking, particularly in public areas, but by and large most are not masking.”
KABUL, Afghanistan — Amena, 7 months old, lay silently in her hospital crib amid the mewling of desperately ill infants in the malnutrition ward.
Her mother, Balqisa, had brought the child to Indira Gandhi Children’s Hospital in Kabul, Afghanistan’s capital, the night before. “Her body was so hot,” she said, stroking her daughter’s emaciated leg.
The baby had a high fever, convulsions and sepsis, said Dr. Mohammad Iqbal Sadiq, a pediatrician, glancing at her chart.
“Her chances are not good,” the doctor said. “We got her too late.”
At the Indira Gandhi hospital, and in faltering hospitals across Afghanistan, famished children arrive by car and taxi and ambulance every day and night. Acute malnutrition is just one of a cascade of maladies that threaten to topple the country’s fragile health system.
acute poverty, with 4.7 million Afghans likely to suffer severe malnutrition this year, according to the United Nations. Last month, the organization made its biggest appeal ever for a single country, asking international donors to give more than $5 billion to fend off a humanitarian disaster.
doubled since August, with 40 children dying in December on their way to receive medical care.
Jonas Gahr Store, the prime minister of Norway, whose country hosted meetings between Taliban representatives and Afghan civil society groups last week, spoke to the Security Council about the urgency to expedite aid.
“We need new agreements and commitments in place to be able to assist and help an extremely vulnerable civil population, and most vulnerable among them, the children who face hunger and suffering,” he said.
Before the U.S.-backed Afghan government disintegrated in August as the Taliban overran the country, the health system relied on international aid to survive. But much of that funding has been frozen to comply with sanctions imposed on the Taliban.
As a result, the International Rescue Committee recently predicted that 90 percent of Afghanistan’s health clinics were likely to shut down in the coming months. The World Health Organization has said that outbreaks of diarrhea, measles, dengue fever, malaria and Covid-19 threaten to overwhelm overburdened hospitals.
including $308 million in relief authorized by the United States, they have not been enough to cover 1,200 health facilities and 11,000 health workers.
Though the drastic decline in war-related casualties has relieved the burden of such patients on many hospitals, the suspension of operations by private facilities and the ability to safely travel Afghanistan’s roads has left other hospitals overrun with people.
On a recent morning, the corridors of Indira Gandhi hospital were crammed with beds as patients’ family members squatted on floors amid parcels of food bought at the local bazaar.
Patients’ meals consist of an egg, two apples, a milk packet, rice and juice, so many families supplement them with outside food. Some buy medicine at local pharmacies because the hospital can provide only about 70 percent of required medication, Dr. Sadiq said.
has now claimed more than 900,000 lives across the country, and the Covid death rates remain alarmingly high. The number of new infections, however, has fallen by more than half since mid-January, and hospitalizations are also declining.
Boosters. New data from the Centers for Disease Control and Prevention confirmed that booster doses are most beneficial to older adults. For younger Americans, vaccination decreased the risk of hospitalization and death so sharply that the additional shot did not seem to add much benefit.
Around the world. Several countries are easing their pandemic protocols, though public health leaders at the World Health Organization continued to urge caution about relaxing restrictions. In Austria, a sweeping Covid vaccine mandate is set to become law.
Few Afghans wear masks — even at the Ministry of Public Health in Kabul. There, officials clustered in groups on a recent weekday, greeting visitors with hugs and kisses, and ignoring faded signs saying masks were required throughout the building.
At the Afghan-Japan Communicable Disease Hospital in Kabul, the only remaining Covid-19 facility in the capital, few staff members or patients complied with worn stickers on the floors that proclaimed: “Let’s Beat Coronavirus — Please keep at least 2 meters from people around you.”
“When I try to talk to people about Covid-19, they say we have no food, no water, no electricity — why should we care about this virus?” said Dr. Tariq Ahmad Akbari, the hospital’s medical director.
Dr. Akbari suspected that the Omicron variant had entered the country, but the hospital lacked the medical equipment to test for variants. He and his staff had not been paid for five months, he said, and the hospital was critically low on oxygen supplies and health care workers.
Seven of the hospital’s eight female doctors fled after the Taliban takeover in August, part of a hollowing out that reduced the staff from 350 to 190 the past five months. Four of the five staff microbiologists quit. And only five of the country’s 34 Covid-19 centers were still operating, Dr. Akbari said.
Several staff members lived in the hospital in Kabul because, without salaries, they cannot afford rent, he said.
The hospital was recently buoyed by a two-month stopgap grant of $800,000 from an affiliate of Johns Hopkins Hospital, Dr. Akbari said. And Afghanistan’s relative isolation following the Taliban takeover had likely helped contain the spread of Covid-19, he said.
Up to 20 patients died per day during the previous wave, but just one or two a day now. And the hospital tests about 150 patients a day now, down from 600 to 700 daily tests during the second wave, Dr. Akbari said.
He speculated that Afghans are so overwhelmed by other survival issues that they are less likely to seek treatment for Covid-19.
Before the Taliban takeover, the Ministry of Public Health published detailed daily charts showing the number of coronavirus cases, hospitalizations and deaths — and the positivity rate for testing. But now the poorly funded ministry struggles to keep tabs on the pandemic.
Of the more than 856,000 tests conducted since the first wave of Covid-19 in early 2020 — of an estimated population of nearly 40 million — roughly 163,000 were positive, a health ministry spokesman said. More than 7,400 Covid-19 deaths had been confirmed since 2020, he said.
But because testing is extremely limited and the cause of death is not recorded in many instances, particularly in rural areas of Afghanistan, no one knows the pandemic’s true scale.
Dr. Akbari shook his head in frustration as he described how little was known about the virus in Afghanistan.
Looking defeated, he said, “If we have a surge like we had during the second and third wave, we would not be equipped to handle it.”
The police had warned Xie Yang, a human rights lawyer, not to go to Shanghai to visit the mother of a dissident. He went to the airport anyway.
His phone’s health code app — a digital pass indicating possible exposure to the coronavirus — was green, which meant he could travel. His home city, Changsha, had no Covid-19 cases, and he had not left in weeks.
Then his app turned red, flagging him as high risk. Airport security tried to put him in quarantine, but he resisted. Mr. Xie accused the authorities of meddling with his health code to bar him from traveling.
model of secure order, in contrast to the “chaos of the West.” In the two years since officials isolated the city of Wuhan in the first lockdown of the pandemic, the Chinese government has honed its powers to track and corral people, backed by upgraded technology, armies of neighborhood workers and broad public support.
zero Covid” approach has helped keep infections low, while the death toll continues to grow in the United States and elsewhere. But Chinese officials have at times been severe, isolating young children from their parents or jailing people deemed to have broken containment rules.
City officials did not respond to questions about assertions by Mr. Xie, the lawyer. While it is hard to know what goes on in individual cases, the government itself has signaled it wants to use these technologies in other ways.
Officials have used pandemic health monitoring systems to flush out fugitives. Some fugitives have been tracked down by their health codes. Others who avoided the apps have found life so difficult that they have surrendered.
health code. Residents sign up for the system by submitting their personal information in one of a range of apps. The health code is essentially required, because without it, people cannot enter buildings, restaurants or even parks. Before the pandemic, China already had a vast ability to track people using location data from cellphones; now, that monitoring is far more expansive.
expanded their definition of close contact to include people whose cellphone signals were recorded within as much as half a mile of an infected person.
The party’s experiment in using data to control the flow of people has helped keep Covid at bay. Now these same tools potentially give officials greater power to manage other challenges.
as a model for how China can use technology to address social problems.
Since 2020, Hangzhou has also used video cameras on streets to check whether residents are wearing masks. One district monitored home power consumption to check whether residents were sticking to quarantine orders. The central city of Luoyang installed sensors on the doors of residents quarantining at home, in order to notify officials if they were opened.
crashed twice in two weeks,disrupting the lives of residents who had to update their apps each day with proof that they had taken Covid tests.
By focusing on technology and surveillance, Chinese officials may be neglecting other ways of protecting lives, such as expanding participation in public health programs, wrote Chen Yun, a scholar at Fudan University in Shanghai, in a recent assessment of China’s response to Covid.
state media — roughly one in every 250 adults. Under the grid management system, cities, villages and towns are divided into sections, sometimes of just a few blocks, which are then assigned to individual workers.
During normal times, their duties included pulling weeds, mediating disputes and keeping an eye on potential troublemakers.
Amid the pandemic, those duties mushroomed.
take out their trash.
They also were given powerful new tools.
The central government has directed the police, as well as internet and telephone companies, to share information about residents’ travel history with community workers so that the workers can decide whether residents are considered high-risk.
a woman who was eight months pregnant because her Covid test result had expired hours earlier. She lost the baby, an episode that inspired widespread public fury. But some blamed the heavy burden placed upon low-level workers to stamp out infections.
The Coronavirus Pandemic: Key Things to Know
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“In their view, it’s always preferable to go too far than be too soft-handed, but that’s the pressure created by the environment nowadays,” Li Naitang, a retired worker in Xi’an, said of local officials.
Still, for defenders of China’s stringent measures, the results are undeniable. The country has recorded only 3.3 coronavirus deaths per million residents, compared to about 2,600 per million in the United States. In mid-January, Xi’an officials announced zero new infections; this past week, the lockdown was lifted entirely.
‘You’ll never be lost’
The government’s success in limiting infections means its strategy has earned something that has proved elusive in many other countries: widespread support.
published an analysis of each province’s criteria for a health code to turn from green to yellow. It concluded that, for most provinces, the answer was unclear.
“You never know if your planned itinerary will be canceled, or if your travel plans can be realized,” the article said.
local news report. Eighteen summonses were successfully delivered as a result.
Local governments across China have sought to assure people that their health code data will not be abused. The central government has also issued regulations promising data privacy. But many Chinese people assume that the authorities can acquire whatever information they want, no matter the rules.
Zan Aizong, a former journalist in Hangzhou, says the expansion of surveillance could make it even easier for the authorities to break up dissenters’ activities. He has refused to use the health code, but it means moving around is difficult, and he finds it hard to explain his reasoning to workers at checkpoints.
“I can’t tell them the truth — that I’m resisting the health code over surveillance,” he said, “because if I mentioned resistance, they’d think that was ridiculous.”
Joy Dong, Liu Yi and Li You contributed reporting and research.
WASHINGTON — Companies are bracing for another round of potentially debilitating supply chain disruptions as China, home to about a third of global manufacturing, imposes sweeping lockdowns in an attempt to keep the Omicron variant at bay.
The measures have already confined tens of millions of people to their homes in several Chinese cities and contributed to a suspension of connecting flights through Hong Kong from much of the world for the next month. At least 20 million people, or about 1.5 percent of China’s population, are in lockdown, mostly in the city of Xi’an in western China and in Henan Province in north-central China.
The country’s zero-tolerance policy has manufacturers — already on edge from spending the past two years dealing with crippling supply chain woes — worried about another round of shutdowns at Chinese factories and ports. Additional disruptions to the global supply chain would come at a particularly fraught moment for companies, which are struggling with rising prices for raw materials and shipping along with extended delivery times and worker shortages.
China used lockdowns, contact tracing and quarantines to halt the spread of the coronavirus nearly two years ago after its initial emergence in Wuhan. These tactics have been highly effective, but the extreme transmissibility of the Omicron variant poses the biggest test yet of China’s system.
Volkswagen and Toyota announced last week that they would temporarily suspend operations in Tianjin because of lockdowns.
Analysts warn that many industries could face disruptions in the flow of goods as China tries to stamp out any coronavirus infections ahead of the Winter Olympics, which will be held in Beijing next month. On Saturday, Beijing officials reported the city’s first case of the Omicron variant, prompting the authorities to lock down the infected person’s residential compound and workplace.
If extensive lockdowns become more widespread in China, their effects on supply chains could be felt across the United States. Major new disruptions could depress consumer confidence and exacerbate inflation, which is already at a 40-year high, posing challenges for the Biden administration and the Federal Reserve.
“Will the Chinese be able to control it or not I think is a really important question,” said Craig Allen, the president of the U.S.-China Business Council. “If they’re going to have to begin closing down port cities, you’re going to have additional supply chain disruptions.”
thrown the global delivery system out of whack. Transportation costs have skyrocketed, and ports and warehouses have experienced pileups of products waiting to be shipped or driven elsewhere while other parts of the supply chain are stymied by shortages.
Understand the Supply Chain Crisis
For the 2021 holiday season, customers largely circumvented those challenges by ordering early. High shipping prices began to ease after the holiday rush, and some analysts speculated that next month’s Lunar New Year, when many Chinese factories will idle, might be a moment for ports, warehouses and trucking companies to catch up on moving backlogged orders and allow global supply chains to return to normal.
But the spread of the Omicron variant is foiling hopes for a fast recovery, highlighting not only how much America depends on Chinese goods, but also how fragile the supply chain remains within the United States.
American trucking companies and warehouses, already short of workers, are losing more of their employees to sickness and quarantines. Weather disruptions are leading to empty shelves in American supermarkets. Delivery times for products shipped from Chinese factories to the West Coast of the United States are as long as ever — stretching to a record high of 113 days in early January, according to Flexport, a logistics firm. That was up from fewer than 50 days at the beginning of 2019.
The Biden administration has undertaken a series of moves to try to alleviate bottlenecks both in the United States and abroad, including devoting $17 billion to improving American ports as part of the new infrastructure law. Major U.S. ports are handling more cargo than ever before and working through their backlog of containers — in part because ports have threatened additional fees for containers that sit too long in their yards.
Yet those greater efficiencies have been undercut by continuing problems at other stages of the supply chain, including a shortage of truckers and warehouse workers to move the goods to their final destination. A push to make the Port of Los Angeles operate 24/7, which was the centerpiece of the Biden administration’s efforts to address supply chain issues this fall, has still seen few trucks showing up for overnight pickups, according to port officials, and cargo ships are still waiting for weeks outside West Coast ports for their turn for a berth to dock in.
work slowdowns and shipping delays.
“If you have four closed doors to get through and one of them opens up, that doesn’t necessarily mean quick passage,” said Phil Levy, the chief economist at Flexport. “We should not delude ourselves that if our ports become 10 percent more efficient, we’ve solved the whole problem.”
Chris Netram, the managing vice president for tax and domestic economic policy at the National Association of Manufacturers, which represents 14,000 companies, said that American businesses had seen a succession of supply chain problems since the beginning of the pandemic.
“Right now, we are at the tail end of one flavor of those challenges, the port snarls,” he said, adding that Chinese lockdowns could be “the next flavor of this.”
Manufacturers are watching carefully to see whether more factories and ports in China might be forced to shutter if Omicron spreads in the coming weeks.
Neither Xi’an nor Henan Province, the site of China’s most expansive lockdowns, has an economy heavily reliant on exports, although Xi’an does produce some semiconductors, including for Samsung and Micron Technology, as well as commercial aircraft components.
How the Supply Chain Crisis Unfolded
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The pandemic sparked the problem. The highly intricate and interconnected global supply chain is in upheaval. Much of the crisis can be traced to the outbreak of Covid-19, which triggered an economic slowdown, mass layoffs and a halt to production. Here’s what happened next:
A reduction in shipping. With fewer goods being made and fewer people with paychecks to spend at the start of the pandemic, manufacturers and shipping companies assumed that demand would drop sharply. But that proved to be a mistake, as demand for some items would surge.
Demand for protective gear spiked. In early 2020, the entire planet suddenly needed surgical masks and gowns. Most of these goods were made in China. As Chinese factories ramped up production, cargo vessels began delivering gear around the globe.
Then, a shipping container shortage. Shipping containers piled up in many parts of the world after they were emptied. The result was a shortage of containers in the one country that needed them the most: China, where factories would begin pumping out goods in record volumes
Demand for durable goods increased. The pandemic shifted Americans’ spending from eating out and attending events to office furniture, electronics and kitchen appliances – mostly purchased online. The spending was also encouraged by government stimulus programs.
Strained supply chains. Factory goods swiftly overwhelmed U.S. ports. Swelling orders further outstripped the availability of shipping containers, and the cost of shipping a container from Shanghai to Los Angeles skyrocketed tenfold.
Handel Jones, the chief executive of International Business Strategies, a chip consultancy, said the impact on Samsung and Micron would be limited, but he expressed worries about the potential for broader lockdowns in cities like Tianjin or Shanghai.
stay away from any vehicle collisions involving Olympic participants, to avoid infection.
Last year, terminal shutdowns in and around Ningbo and Shenzhen, respectively the world’s third- and fourth-largest container ports by volume, led to congestion and delays, and caused some ships to reroute to other ports.
But if the coronavirus does manage to enter a big port again, the effects could quickly be felt in the United States. “If one of the big container terminals goes into lockdown,” Mr. Huxley said, “it doesn’t take long for a big backlog to develop.”
Airfreight could also become more expensive and harder to obtain in the coming weeks as China has canceled dozens of flights to clamp down on another potential vector of infection. That could especially affect consumer electronics companies, which tend to ship high-value goods by air.
For American companies, the prospect of further supply chain troubles means there may be another scramble to secure Chinese-made products ahead of potential closures.
Lisa Williams, the chief executive of the World of EPI, a company that makes multicultural dolls, said the supply chain issues were putting pressure on companies like hers to get products on the shelves faster than ever, with retailers asking for goods for the fall to be shipped as early as May.
Dr. Williams, who was an academic specializing in logistics before she started her company, said an increase in the price of petroleum and other raw materials had pushed up the cost of the materials her company uses to make dolls, including plastic accessories, fibers for hair, fabrics for clothing and plastic for the dolls themselves. Her company has turned to far more expensive airfreight to get some shipments to the United States faster, further cutting into the firm’s margins.
“Everything is being moved up because everyone is anticipating the delay with supply chains,” she said. “So that compresses everything. It compresses the creativity, it compresses the amount of time we have to think through innovations we want to do.”
Ana Swanson reported from Washington, and Keith Bradsher from Beijing.
China’s “zero Covid” policy has a dedicated following: the millions of people who work diligently toward that goal, no matter the human costs.
In the northwestern city of Xi’an, hospital employees refused to admit a man suffering from chest pains because he lived in a medium-risk district. He died of a heart attack.
They informed a woman who was eight months pregnant and bleeding that her Covid test wasn’t valid. She lost her baby.
Two community security guards told a young man they didn’t care that he had nothing to eat after catching him out during the lockdown. They beat him up.
a strict lockdown in late December when cases were on the rise. But it was not prepared to provide food, medical care and other necessities to the city’s 13 million residents, creating chaos and crises not seen since the country first locked down Wuhan in January 2020.
the weaknesses in China’s authoritarian system. Now, with patients dying of non-Covid diseases, residents going hungry and officials pointing fingers, the lockdown in Xi’an has shown how the country’s political apparatus has ossified, bringing a ruthlessness to its single-minded pursuit of a zero-Covid policy.
Xi’an, the capital of Shaanxi Province, is in a much better position than Wuhan in early 2020, when thousands of people died of the virus, overwhelming the city’s medical system. Xi’an has reported only three Covid-related deaths, the last one in March 2020. The city said 95 percent of its adults were vaccinated by July. In the latest wave, it had reported 2,017 confirmed cases by Monday and no deaths.
read a self-criticism letter in front of a video camera. “I only cared about whether I had food to eat,” the young man read, according to a widely shared video. “I didn’t take into account the serious consequences my behavior could bring to the community.” The volunteers later apologized, according to The Beijing News, a state media outlet.
Three men were caught while escaping from Xi’an to the countryside, possibly to avoid the high costs of the lockdown. They hiked, biked and swam in wintry days and nights. Two of them were detained by the police, according to local police and media reports. Together they were called the “Xi’an ironmen” on the Chinese internet.
Then there were the hospitals that denied patients access to medical care and deprived their loved ones the chance to say goodbye.
The man who suffered chest pain as he was dying of a heart attack waited six hours before a hospital finally admitted him. After his condition worsened, his daughter begged hospital employees to let her in and see him for the last time.
A male employee refused, according to a video she posted on Weibo after her father’s death. “Don’t try to hijack me morally,” he said in the video. “I’m just carrying out my duty.”
commented that some local officials were simply blaming their underlings. It seemed, the broadcaster wrote, only low-level cadres have been punished for these problems.
There are reasons people in the system showed little compassion and few spoke up online.
An emergency room doctor in eastern Anhui Province was sentenced to 15 months in prison for failing to follow pandemic control protocols by treating a patient with a fever last year, according to CCTV.
A deputy director-level official at a government agency in Beijing lost his position last week after some social media users reported that an article he wrote about the lockdown in Xi’an contained untruthful information.
In the article, he called the lockdown measures “inhumane” and “cruel.” It bore the headline “The Sorrow of Xi’an Residents: Why They Ran Away from Xi’an at the Risk of Breaking the Law and Death.”
diary, no citizen journalists Chen Qiushi, Fang Bin or Zhang Zhan posting videos. The four of them have either been silenced, detained, disappeared or left dying in jail — sending a strong message to anyone who might dare to speak out about Xi’an.
The only widely circulated, in-depth article about the Xi’an lockdown was written by the former journalist Zhang Wenmin, a Xi’an resident known by her pen name, Jiang Xue. Her article has since been deleted and state security officers have warned her not to speak further on the matter, according to a person close to her. Some social media users called her garbage that should be taken out.
A few Chinese publications that had written excellent investigative articles out of Wuhan didn’t send reporters to Xi’an because they couldn’t secure passes to walk freely under lockdown, according to people familiar with the situation.
The Xi’an lockdown debacle hasn’t seemed to convince many people in China to abandon the country’s no-holds-barred approach to pandemic control.
told Xi’an officials on Monday that their future pandemic control efforts should remain “strict.”
“A needle-size loophole can funnel high wind,” he said.
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