China’s zero-Covid restrictions may heap pressure on the global economy by prolonging supply-chain disruptions and intensifying the impact of inflation, a Bank of Japan (BOJ) policymaker said on Wednesday. The remark follows a warning last month by International Monetary Fund head Kristalina Georgieva that China should reassess its zero-Covid approach to the pandemic, given the emergence of the highly contagious Omicron variant. “China’s economy is the world’s market and factory,” BOJ board member Toyoaki Nakamura said in a speech. “There’s a risk that its zero-Covid policy, amid widening Omicron infections , could weigh on the global economy, as well as prolong global supply-chain disruptions and inflationary pressures.” Uncertainty over how quickly Japanese companies pass on rising raw material costs to households is also among the risks to the country’s economy, said Nakamura, a former executive at Japanese electronics giant Hitachi. What next for China’s zero-Covid policy as Omicron travels the world? Nakamura said Japan’s economy is expected to recover as the impact of the pandemic and supply constraints subside. But he said the BOJ will maintain its ultra-loose monetary policy to ensure the economy strengthens enough to accelerate inflation to its 2 per cent target. China’s economy grew by 8.1 per cent in 2021, but the growth rate lost steam in the second half of the last year amid widespread debates over whether stringent Covid controls have become too costly and need to be loosened to shore up growth. For the economy to grow steadily, China should balance economic development and pandemic prevention, which “should be orderly, but not overly excessive”, according to an article published last month in the Bulletin of Chinese Academy of Sciences – a think tank journal under the academy – adding that the approach to China’s socioeconomic development must transition from “zero Covid” to “normalised Covid”. “[China should] establish a preventive mechanism that adjusts to industries and companies’ production, to prevent a ‘one-size-fits-all’ approach,” said the article, co-authored by six of the academy’s researchers. They also forecasted that China’s GDP will grow by 5.5 per cent in 2022. “The emergency response plan needs to be perfected, the occurrence of sporadic outbreaks needs to be strictly controlled according to the protocols, and the effects on companies’ production and operations need to be cut as much as possible under the condition that outbreaks are effectively contained,” it said. The article also noted the importance of continued mass vaccinations in China. Wu Zunyou, chief epidemiologist at the Chinese Centre for Disease Control and Prevention, said China has recorded fewer than 5,000 deaths since the start of the pandemic, largely thanks to zero-Covid policies. Reports by some major Western media outlets, however, have suggested that the death toll has been under-reported in China – an allegation that Beijing has denied. China’s dynamic zero-infection policy “is the most efficient control measure thus far”, Wu said in an interview published on Wednesday in the Global Times , a nationalistic tabloid owned by People’s Daily , the party mouthpiece. “If we cannot find a new way to prevent the spread of the virus after it is imported, the dynamic-zero policy will not be adjusted for now.”