China faces dilemma as it tries to get back to work amid coronavirus outbreak fears
- Economist says allowing people to return to their jobs after extended Lunar New Year holiday is crucial for both economy and fighting outbreak
- But public transport numbers for the weekend indicate people might not be rushing back
Allowing the workforce to return to their jobs was crucial both for sustaining economic growth and providing support to fight the outbreak, according to Lu Zhengwei, chief economist at the Industrial Bank in Shanghai.
“It’s obviously desirable for employers who are now paying rent, salaries and social welfare for their employees, for nothing in return,” he said, adding that most small and medium enterprises in China could only last about a month in the current situation.
After the State Council, China’s cabinet, issued a directive to extend the holiday until last weekend as part of measures to contain the virus outbreak, a number of provinces and municipalities – including Beijing, Shanghai, Zhejiang and Guangdong – pushed back the return to work to this Monday.
Advisory firm Oxford Economics has lowered its growth outlook for China to 5.4 per cent in 2020, compared with 6 per cent previously, according to its chief Asia economist Louis Kuijs.