Alright, we'll China ordering a seven day lockdown of the area around fox Kon's main iPhone plant in Jengaile. This comes. It's trying to reiterates its firm adherence to a COVID zero policy. Joining us now is John LOEU Bloomberg, Senior Executive Editor for Greater China. I mean, there wasn't too much of a reaction in terms of what we saw from the hon high share price yesterday in Taiwan. But but this is just another example of how we're continuing
to see this COVID zero enforcement. Just tell us the latest here, John, So the latest, Julia is that the lockdown in Ginger has actually expanded. So we have the area around the iPhone plant in lockdown for seven days. Uh. More broadly, the city center is being locked down for three days. Traffic is being limited, trains are being stopped, businesses are being closed. That comes after yesterday there was
a spike. The number of infections tripled to about three fifty, slightly lower today the numbers I think it was about a hundred and sixty or so, And so obviously a lot of people on edge and the authorities they're trying to take measures as they see fit. What did you make of the National Health Commission telling official state committed
to COVID zero. It seems a reaffirmation, perhaps not that new, but it is um But it does come after a period when the market rallied because of thoughts of something different going forward. I think it was, or at the very least, the market seems to be taking it as a signal of of what policymakers are thinking. That meeting at the National Health Commission that happened as sort of UH post party congress a couple of weeks ago, the the officials they're got together to study sort of the
outcomes of that congress. But from in the statement post meeting, they did reiterate that China is committed to COVID zero, the officials around the country should be executing COVID zero. And so in the midst of all this UH excitement about potentially some rollback or exit from that policy, I think that statement is telling markets it calmed down. You know, you might be getting ahead of yourselves. Yeah, and and tell us what the feeling is like on the ground.
I mean, there must have been quite a lot of exuberance, because we certainly saw that reflected in market activity on those reopening hopes or rumors. But it really does seem like they're saying, hold on, we're not We're not there yet, and we may not even be there yet until March
or later. I think the pain that COVID zero has inflicted economically, socially on businesses, on the citizenship is very pronounced, and it is not especially it's not a popular policy, and I think a lot of people would like the country to exit the policy. And so what you see there was an obvious excitement about potentially there being a reopening of the economy of the country's borders. Uh, and
the markets responded in tune. I think that looking forward realistically, if there is an exit, it's not going to come soon, and it will come gradual, step by step, and way off into the future. John, I know you're the perfect person to ask this sort of esoteric question too, but because I know you'll handle it well. Um, it's a it's a line from a piece that Tom Freeman wrote
in The New York Times two the year China lost America. Uh. Potentially, Um, I think you could have that could have happened much earlier. I think you know, the relationship has been strained, and you know it probably uh that strange sort of came to the four with the Trump presidency, But I think no matter who was elected president in sixteen, I think
the relationship would have been very tense and difficult. You know what, does it make it a lot tougher question if we rephrased it a little and said, is two the year China lost the West? I think there's a I think it might be, but I think the reason there was a real shift in attitudes in the West towards China probably extends from Russia's invasion of Ukraine more
so than anything that China did. I think that that war has really focus people's attention on Taiwan on how much they can countries in the West should be relying on countries with different forms of government, and that that debate is more public than it's ever been. Getting back to to the lockdown too, And from fox CON's point of view, I mean, does this make having factories in China seem less desirable when you when you can't really
control whether or not you can continue to manufacture. Absolutely. I think the bigger risk here for the Chinese economy is that that these COVID lockdowns are going to push companies to diversify, to look for other places where they can establish manufacturing. It's not going to happen very quickly because China has some very disadvantages. Fox God has huge plants.
There are lots of workers, but lots of component suppliers around them, and so you can easily get the things that you need to put together the latest iphon, the latest laptop, whatever you're trying to produce. In the longer term, though, those things are movable, and you've seen Apple beginning to make phones in India for example. Yeah, lots of other
companies thinking about these types of things. Some on a more positive note, the PBOC governor Egan yesterday sounded a kind of optimistic outlook, although he did say he hoped for a soft landing with the property market, but he said that the economy remains broadly on track. Your thoughts on that interpretation, I think there are a lot of
fundamental things that that remain in China's favor, uh. I think key among those is the fact that China, relatively speaking, is still poor when you compare it to the US. Too many countries in Europe on a per capita basis, and so that that leaves a lot of room for ketchup uh and catch up is obviously easier to do to generate growth from than being at the cutting edge of technology, for example, a sorry finish your third No. That being said that the situation globally is turning against
China technolog alright. Always great reporting, John Loe, Thank you Blomberg, Senior executive editor for Greater China with us in our Beijing studio