Each new year brings hope and a desire for what went before to improve. But 2022, like 2021, also dawns with uncertainty, the Covid-19 pandemic still with us and being a significant factor in determining the direction for mainland China, Hong Kong and the world. There are major events ahead, among them the Beijing Winter Olympic Games, leadership votes on the mainland and in the Special Administrative Region and the 50th anniversary of the process that led to Beijing and Washington normalising relations. But with Chinese and American tensions continuing, interest rates likely to rise and no sign of a let-up in curbs on supply chains, trade and travel, there is as much need for caution as optimism in the coming 12 months.

The threat of the coronavirus has not lessened as the third year of its global impact looms, despite the unprecedented speed at which effective vaccines were rolled out during 2021. A tsunami of cases is sweeping the world, driven by a combination of the Omicron and Delta variants and pushing daily infection figures in an increasing number of countries to record levels. Health authorities have a better understanding of the disease and treatments have improved, but the World Health Organization has warned dangers remain. The new year has started with Hong Kong’s first outbreak in months and while many here are receiving booster jabs, the inequity in supply between rich and poor nations is giving the virus more time to spread and mutate. But experts agree the pandemic will eventually end. Science is reason for optimism.

Goal of common prosperity

The global economy has been shackled by the coronavirus, impacting supply chains and trade. Beijing will push forward with measures to ensure growth continues under its dual-circulation strategy and is guided by the goal of common prosperity. A crucial element this year will be the continuing improvement of innovation and technology to move up the production ladder while furthering regulations to lessen financial risks. In the face of pressure from the United States and its allies, China needs to rely more on its domestic market; the challenge will be stimulating consumption by making people feel confident to spend more and have children.

Will the coronavirus pandemic finally end in 2022?

Beijing will become the first city to host both Olympic Games, following up its staging of the 2008 Summer Games with the winter edition from February 4. As symbolic is the marking later in the month of former US president Richard Nixon’s landmark trip to China half a century ago that began the process of establishing diplomatic relations with Washington. He met leader Mao Zedong on February 21, 1972, and after talks with premier Zhou Enlai, agreed to the Shanghai Communique, under which both sides pledged to work for normalisation of relations and expand people-to-people contacts and trade. Later, US allies Japan, Germany, Australia and New Zealand followed suit. Now China is again at a crossroads with the West, and diplomats hold the key to better relations.