Covid uptick prompts China to order 1 million people to stay home

The iPhone manufacturing hub of Zhengzhou shut down one of its most populous districts to combat a virus outbreak, with creeping restrictions across China highlighting the constant threat of disruption companies face while the country adheres to Covid Zero.

According to a government notice, nearly 1 million residents of Zhongyuan district were ordered to stay at home beginning Monday, except when required to undergo Covid testing, and non-essential businesses were closed. The broader restrictions follow the lockdown of some neighbourhoods last week, which caught many people off guard after officials said there would be no citywide lockdown.

Foxconn Technology Group's plants are not in the restricted area. Representatives for the company did not immediately respond to a request for comment from Bloomberg News.

The city reported six new local cases on Sunday, down from a high of 40 on October 9. Cases in China fell to 697, the lowest in two weeks, as outbreaks in Inner Mongolia and Xinjiang were contained. Beijing had 13 new cases, while Shanghai had 32.

Despite the high cost, China is sticking to the Covid Zero pillars of lockdowns and mass testing to contain its largest flareup in two months. The policy has slowed growth in the world's second-largest economy and roiled global supply chains as key manufacturing hubs – from automobiles to phones and Christmas trees – deal with the disruption of shutdowns and reopenings.

President Xi Jinping signalled no change in policy on Sunday, disappointing investors who had hoped for some signs of easing. Xi said the strict rules protect people's lives during a speech opening the twice-decade Party Congress in Beijing, though he avoided mentioning the economic toll.

Bloomberg polled economists predict 3.3% growth this year, the second-lowest rate in more than four years.

The strict Covid regulations have also fueled public discontent. Words like "Beijing" and "bridge" were restricted on social media platforms like Weibo late last week after two banners criticising Xi and Covid Zero were displayed on a bridge in the capital. "We want food, not PCR tests," one said. We want liberty, not restrictions and controls."

While China's most important cities have avoided large-scale lockdowns thus far, officials have quietly halted a growing list of activities. According to parents and social media posts, several schools in Shanghai have suspended in-person classes as the fear of infection spread grows. Last week, the port city of Tianjin and the southern megacity of Guangzhou announced a lockdown of one district each.