China’s Covid outbreak wanes as restrictions eased to boost economy

China reported the fewest new Covid-19 cases in almost three months, with the easing of outbreaks in Beijing and Shanghai emboldens authorities to ease some of its strictest virus controls of the pandemic and move to stimulate the country’s faltering economy.

In Beijing, infections dropped to 12 on Sunday, from 21 on Saturday. Curbs on movement in several districts started to be loosened yesterday after officials said the outbreak was under control. The decline has eased concern that Beijing could have been headed for a lockdown when it was reporting several dozen cases a day earlier in the outbreak despite increasingly strict restrictions.

In Shanghai, cases fell to 67 for Sunday from 122 on Saturday. The financial hub on Sunday rolled out a raft of measures to support its lockdown-hit economy, including allowing all manufacturing to restart from Wednesday.

There were 122 cases reported across the country on Sunday, the fewest since March 3. China hasn’t reported a day without infections since October because of repeated outbreaks of the highly transmissible omicron and delta variants, despite its zero-tolerance approach to the virus.

At the weekend, Shanghai said it will accelerate approvals for property projects and the quota for car ownership this year will be increased by 40,000. A purchase tax for some passenger vehicles will be reduced and subsidies will be given to electric-car buyers. Covid test requirements will be loosened for people entering public places from June 1 as the city tries to restore a sense of normalcy after a two-month lockdown of its 25 million population.

China’s dogged adherence to its Covid Zero policy at all costs -- epitomized by Shanghai’s lockdown and restrictions imposed elsewhere in the country of 1.4 billion -- has dragged on everything from consumer spending to manufacturing in the world’s second-largest economy. The harsh curbs, which confined millions of people to their apartments or residential compounds, also sparked clashes between residents and police.

The Shanghai measures come after the State Council, the equivalent of China’s cabinet, outlined a 140 billion-yuan ($21 billion) package of extra tax rebates and loans aimed at stimulating the battered economy. Most economists expect it will be difficult for China to meet its economic growth target of about 5.5% this year because of the disruption wrought by its Covid approach.

In Beijing, most public transport including buses, subways and taxis will resume in three districts including the biggest, Chaoyang. Shopping centers outside of controlled areas in the city will also be allowed to reopen with capacity limits. Chaoyang is home to one of Beijing’s key central business districts, most foreign embassies and a lot of its expatriate community.

Workers in some Beijing districts who were required to work from home previously will be allowed to return to their workplaces, and hotels and hostels in five districts on the city’s outskirts will be permitted to reopen.

Schools and kindergartens will remain suspended and university campuses will stay closed, with students urged to go home before the summer holidays. Dining-in is still banned at restaurants.