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China Postpones Key Economic Policy Meeting Due To Covid Spike

There’s no set timetable for when the Central Economic Work Conference, usually attended by President Xi Jinping, will be rescheduled.

Residents queue at a Covid testing booth in Beijing, China, on Tuesday, Dec. 13. 2022. China's abrupt ending of its Covid Zero policy injects more uncertainty into an already fragile economy, raising the prospect of looser fiscal and monetary policy and more easing in the property market to bolster growth.
Residents queue at a Covid testing booth in Beijing, China, on Tuesday, Dec. 13. 2022. China's abrupt ending of its Covid Zero policy injects more uncertainty into an already fragile economy, raising the prospect of looser fiscal and monetary policy and more easing in the property market to bolster growth.

China is delaying a closely watched economic policy meeting due to start this week after Covid infections surged in Beijing, according to people familiar with the matter.

There’s no set timetable for when the Central Economic Work Conference, usually attended by President Xi Jinping, will be rescheduled, the people said, asking not to be named discussing confidential information.

The conference, where officials discuss policy objectives for the coming year, was due to begin on Thursday. Besides Xi, the meeting is attended by members of the Politburo, provincial governors, and heads of government agencies and financial institutions. In the past, the meeting would last three days, with a readout published in state media at the end.

WATCH: China’s path to reopening will be “bumpy,” says UBS’s Yifan Hu.Source: Bloomberg
WATCH: China’s path to reopening will be “bumpy,” says UBS’s Yifan Hu.Source: Bloomberg

China this month called an abrupt end to its strict pursuit of Covid Zero, scrapping most testing and isolation of infected patients. Signs are now emerging that the virus is spreading rapidly, including in Beijing where there are long lines at hospitals and growing shortage of medication to treat fevers. Beijing’s fever clinics reported 22,000 visits on Sunday, 16 times greater than the previous week, state broadcaster CCTV reported Monday, citing Li Ang, a spokesperson from the municipal health commission.

The State Council Information Office didn’t immediately respond to a fax seeking comment.

With the unexpected about-face injecting more uncertainty into an already fragile growth outlook, economists had been expecting officials to signal looser fiscal and monetary policy and more easing in the property market to bolster growth.

A target for next year’s economic growth would also usually be discussed at the conference, although it won’t be disclosed until the annual legislative meeting in March.

The Communist Party’s new Politburo, stacked with Xi’s allies after he secured a third term in power in October, last week set the tone of the conference by making a decisive shift toward propping up growth. Bloomberg News reported last week that senior officials have been debating a growth target of about 5% for next year.

The CEWC is usually held shortly following a Politburo gathering.

The economy is expected to grow just 3.2% this year, the slowest pace since the 1970s barring the pandemic slump in 2020, according to economists surveyed by Bloomberg.

Authorities have taken a number of decisive steps over the past weeks to prop up growth, including rolling out forceful measures to backstop the slumping property market. Those came after a sustained campaign over the past years that included a broad crack down on private enterprise that roiled markets. 

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