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Some in Shanghai were allowed to shop; End of COVID lockdown in sight

By Brenda Goh

SHANGHAI/BEJING (Reuters) – More Shanghai residents were allowed freedom to shop for groceries on Thursday for the first time in nearly two months, as authorities unveiled further plans for a more complete exit from the citywide COVID-19 lockdown.

The commercial hub of 25 million recorded no new infections outside of quarantine zones for the fifth straight day, cementing its “zero-COVID” status every day.

“I am very happy, the lockdown lifting is beginning,” said shopper Zhong Renqiu at a just-reopened Carrefour supermarket in central Changning District.

“We mainly relied on government supplies and group purchases,” said Zhong, who stocked up on eggs, goji berries, black sesame and oats.

But officials are concerned about the risk of new outbreaks of infection in their efforts to gradually reopen with high stakes and plan to keep most residents largely indoors this month and prioritize work and manufacturing over other activities.

Deputy Mayor Zhang Wei said economic activity had picked up as companies were able to work with local workers and that authorities would allow more to resume normal operations in early June.

The city is “struggling to achieve a full resumption of work and production as soon as possible,” he said.

“The rhythm of resuming work” would be based on the COVID situation, he said, adding that on-site work restrictions would remain in place for the remainder of May.

Some condominiums in Changning district on Thursday distributed passes for residents to enter the Carrefour store.

The passes were for one person from each household who went to the store for 40 minutes and spent up to 500 yuan (US$74). Residents have been advised to walk or bike to the store and to queue at the entrance, two meters apart.

Some shoppers wore protective gowns while others wore face shields and gloves.

As another positive sign, four of the city’s 18 subway lines will start operating again from Sunday.

Shanghai reported fewer than 800 new cases. For the fifth day in a row, none came from outside the quarantine areas.

The capital Beijing has not imposed a city-wide shutdown, but has gradually tightened restrictions over the past month in a bid to contain a small but ongoing outbreak of a few dozen new infections a day. There were 55 new cases reported for May 18, up from 69.

SIGN OF LIFE

Deputy Mayor Zhang said Shanghai’s economy is gradually returning to normal, with daily container throughput at its ports at 90% of the level of a year ago.

Pudong Airport’s cargo throughput reached 70% of last year’s level, while the number of cargo vehicles entering and exiting the city fell to two-thirds, he said.

About half of Taiwanese companies that suspended work in China due to COVID have resumed production, said the democracy-ruled island’s economy minister.

In another sign of improvement in Chinese manufacturing, the data showed that retail auto sales rose 27% in the first half of May from the same period in April.

But they were still 21% lower than last year.

The COVID restrictions in May were not as severe and widespread as in April, but still weighed on growth.

Goldman Sachs on Wednesday cut its 2022 economic growth forecast for China to 4% from 4.5%, well below the government’s official target of around 5.5%, and warned of a further slide.

China’s “zero-COVID” policy has put hundreds of millions of people under various curbs in dozens of cities, disrupting global manufacturing and businesses from Apple and Tesla to Starbucks and Walmart.

The New York Federal Reserve reported in its latest update to a global index of supply problems that air freight costs between the United States and Asia rose in April and delivery times around the world increased.

This could mean persistent global inflation and rising borrowing costs.

British luxury brand Burberry on Wednesday said its prospects depended on how quickly China, its biggest market, where sales had slumped, recovers from lockdowns.

($1 = 6.7582 Chinese renminbi yuan)

(Reporting by Brenda Goh and David Stanway in Shanghai; Yifan Wang and Ryan Woo in Beijing; the Beijing and Shanghai offices; writing by Marius Zaharia; editing by Robert Birsel)

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