SHENZHEN - The main districts of Chinese tech hub Shenzhen on Friday shut down public transport and extended curbs on public activities as cities across China battles Covid-19 outbreaks that have dampened the outlook for economic recovery.

Official in the southern city on Thursday sought to quell rumours that a full lockdown was imminent. In March, the city swiftly locked down for a week to fight community infections.

On Friday, officials reported 87 new locally transmitted Covid-19 infections in 
Shenzhen for Thursday, up from 62 a day earlier. Eight of the new cases were outside quarantine areas.

Six districts comprising the majority of the city’s population of almost 18 million announced that all residents would be tested twice for Covid-19 over the weekend as subway and bus services were suspended.

Employees should work from home, with the exception of those in self-contained “closed-loop” operations, essential supplies and public services.

Shenzhen officials on Thursday said people could leave and return to their homes with proof of a test result less than 24 hours old.

“We need to get the virus under control, we can’t just give up like some countries,” said a woman surnamed Tang volunteering to help food deliveries at a locked-down housing compound in Futian, Shenzhen’s hardest-hit district.

“But I don’t know when it will end, it’s really hurting businesses,” she added.

Restrictions in the business districts of Futian and Longhua, home to a major campus of Apple iPhone assembler Foxconn, have been extended until Sunday.

Curbing activities of tens of millions of people intensifies the challenges for China to cushion the economic impact of its zero-Covid-19 policy that has kept its borders mostly shut to international visitors.

In south-western China, the megacity of Chengdu went into lockdown late Thursday with mass testing for Covid-19 planned through the weekend. Uncertainty remained whether the lockdown would be lifted after the testing ends on Sunday.

The city of about 21 million people and capital of Sichuan province reported 150 new local cases for Thursday, versus 157 infections on Wednesday.

Non-essential employees were told to work from home. Industrial firms engaged in key manufacturing and able to manage on closed campuses were exempted from work-from-home requirements.

Toyota Motor’s Chengdu plant, which has an annual production capacity of 105,000 vehicles, is “operating normally”, and inside a closed loop at the request of the Sichuan government, a company official told Reuters.

Sweden’s Volvo Cars, majority owned by Chinese automotive company Zhejiang Geely Holding Group, has shut its plant in Chengdu, a company spokesman said Thursday.

'Covid Zero' anxiety

The anxiety in cities like Shenzhen underscores how China’s enduring zero-Covid-19 is keeping the nation on edge, even almost three years after the coronavirus was first detected in Wuhan.

Though new cases in the country are fewer than elsewhere in the world, Beijing has pressed ahead with its strict control measures that brought widespread misery to Shanghai during a gruelling lockdown in April and May. 

Situated on the mainland just across the border from Hong Kong, Shenzhen is home to some of China’s biggest companies, including Huawei Technologies and BYD, which are now accustomed to “closed loop” systems.

The restrictions mean employees only move between work and home, physically cut off from people outside their factories or offices. Such a method has been used by businesses to avoid major disruptions.

A Foxconn representative said Thursday that operations at the firm’s Shenzhen plant were normal.

Lockdown always looms

Nationwide, there were 1,855 cases for Thursday, down from 1,903 the day before.

China’s Covid-19 infections have dropped from a peak of 3,400 in mid-August, but has spread to 25 out of 31 provinces and regions.

Efforts similar to those in Shenzhen – seeking to allay concerns over an impending lockdown – also happened in Shanghai and Chengdu, only to be followed by a lockdown.

A Chengdu man surnamed Yu published a post on Monday saying that the city would go into lockdown, triggering panic-buying by residents.

Officials said the post was false, and detained Yu for 15 days and fined him 1,000 yuan (S$203). Two days later, the speculation became reality.

More pain

China’s economy is bracing itself for more pain as Chengdu's lockdown damages business and consumer activity in the area and hurts sentiment more broadly across the nation.

The lockdown will likely result in a slump in retail and restaurant spending. It could also force factories and companies to shut if staff cannot go to work.

Chengdu makes up 1.7 per cent of China’s national gross domestic product. It is the sixth-largest city, after Beijing, Shanghai, Shenzhen, Guangzhou and Chongqing.

The city has already been hit by severe drought and floods in recent weeks. A power crisis caused by the heatwave forced some factories in the province to shut last month.

The closure of the city “will deal another major blow to the economy when it’s already struggling from a barrage of shocks”, Mr David Qu, an economist at Bloomberg Economics, wrote in a report.

While this will not be as damaging as the Shanghai lockdown, which lasted about two months in the spring, “we do expect a widespread impact on sentiment that amplifies the damage beyond the direct hit to activity”, he said. REUTERS, BLOOMBERG