Wuhan Emerges From Lockdown With a Mission: Our Goal is Survival

Bloomberg
Wuhan businessman Li Jing is counting down the days until his city emerges from virus lockdown.

Employees stand during disinfection operations at Wuhan Tianhe International Airport, April 3. Source: Getty Images

Employees stand during disinfection operations at Wuhan Tianhe International Airport, April 3. Source: Getty Images

The hundreds of apartments Li’s home-stay company oversees can start hosting visitors again on Wednesday -- when the mass quarantine of the Chinese metropolis where the coronavirus first took hold is officially lifted. Trains will be able to leave, the airport will resume flights out, and cars blocked from exiting as the pathogen roared through Wuhan can take to the highways again.

Li’s apartment rentals plummeted to zero after the lockdown was imposed Jan. 23, penning in a population the size of Italy’s once it was expanded to the whole of Hubei province. In an effort to entice bookings, Li’s properties will be cleaned and disinfected for three hours between stays, and he plans to expand the room service menu.

Yet even once the city known for its avenue of cherry blossoms and Yellow Crane Tower is re-opened, Li knows there’s a high chance that his apartments remain empty for weeks -- maybe months -- to come.

“I hope that our fellow Chinese citizens will believe in us and return to Wuhan,” the business owner, 33, said in an interview on a shopping street in the city’s center. It was a warm spring day, and people moved around cautiously, keeping their distance. Everyone, without exception, wore masks.

“But it’s not a place that people would choose as the first place to visit,” Li said.

As the first epicenter of the now global pandemic, Wuhan provides a window into the uncertain, post-virus future.

Significant Damage

While factories in this central Chinese center for steel-making and car manufacture are allowed to re-start, workers are slow to return and supply chains are in disarray. Shopping malls have re-opened, but they’re largely empty, most people still too scared to go out for anything but essentials. The city where the world first saw how rapidly the virus could overwhelm a health-care system may be emerging, but residents’ movements remain tightly controlled, with officials on high alert for any resurgence of infection.

With more than half of China’s officially reported virus cases and deaths, Wuhan is both where Covid-19 began, and where it left the deepest wound. Once a regional powerhouse where gross domestic product growth for last year was expected to have come in at 7.8%, it’s now grappling with the challenges of starting again.

The damage has been significant, says Chen Bo, an economics professor at Wuhan’s Huazhong University of Science and Technology.

“For February, fiscal income loss was about $1 billion and GDP probably contracted by at least 50%,” Chen said. “The social and psychological impact on investment and tourism in the city could last quite some time.”

Bergamo, New York

Just as tragic scenes of chaotic hospitals and desperate patients in Wuhan came to be replicated in cities around the world as the virus spread, its economic recovery will be a harbinger of how the worst-hit places -- from Bergamo in Italy to New York -- emerge from their shutdowns, and the hit to business that the virus brings.

A crucial milestone for the Chinese government’s narrative of triumph over the epidemic, the lifting of the lockdown won’t signal a return to normal life in Wuhan, where the official daily infection tally has dwindled to less than 30 after peaking in the thousands in mid-February. Early signs indicate it will be a slow and painful process, with the shock of the epidemic still lingering and fears of a second virus wave keeping businesses from resuming full operations.

“Our goal for 2020 is first to survive physically,” said Ma Renren, 33, who runs a small marketing agency. The Wuhan native was sitting outside a Starbucks in a northwest district of Wuhan, his first time there in more than two months. “Second is for our businesses to survive.”

Barbed Wire

Life throughout the city has been altered in ways big and small.

Some residents can now move in and out of their apartment blocks, but fences are still topped with barbed wire in places, put there to stop people climbing out during the quarantine. More than 2,500 people died in Wuhan’s outbreak, a government tally that has aroused suspicion as the fatalities in other nations explode.

Workers at smartphone maker Xiaomi Corp.’s office on the city’s eastern edge can now go back to work, but only five people are allowed in each elevator. Tape on the floor marks where they’re supposed to stand during the journey up -- one in each corner and one in the middle -- like a pop group about to burst into a dance sequence.

While catering to new guests again, the spread at a five-star hotel’s breakfast buffet has been reduced to a few staples, and pre-prepared items are now packed into individual, disposable serving containers.

Before the virus, Wuhan was ranked China’s ninth best-performing city in a 2019 report from the Milken Institute, up seven places from the year earlier. It was moving into more high-tech areas from chip-making to biomedicine, and was one of China’s top automotive hubs, home to hundreds of vehicle parts suppliers.

Peugeot Factory

Factories in Wuhan are trying to resume production. Assemblage of a new Peugeot car has started at a plant run by a joint venture between PSA Group and China’s Dongfeng Motor Group Co.

“There are still challenges in logistics, transport, and supply chain,” said Mei Yunfeng, a manager at the factory, one of three plants the JV has in the area. A lot of suppliers aren’t back up to speed, he said.

The city is unlikely to see a resumption in foreign direct investment for some time to come, said Chen, the economics professor.

After the outbreak of Severe Acute Respiratory Syndrome, or SARS, in 2003, FDI into the province of Guangdong -- where the epidemic started -- dried up for two to three years, he said.

“The same thing will happen to Wuhan, investors will be cautious in fear of future outbreaks and also psychologically think that the city is not well-governed,” said Chen. “This outbreak has a devastating impact on Wuhan’s plans to become more integrated into the global supply chain.”

Resurgence Fears

Even as it looks to be beyond the peak, there is growing concern the highly infectious virus could return in Wuhan.

That fear has spawned a system in use nationwide that allocates color codes to every resident. Tracked using apps made by Chinese tech giants Alibaba Group Holding Ltd. and Tencent Holdings Ltd., every user gets one of three colors -- green, yellow or red -- based on their location, basic health information and travel history.

Only those with green codes are allowed to leave their apartments and go to work in Wuhan, and it’s easily lost. Just visiting a shopping mall where a virus case is later confirmed can turn the code yellow, meaning self-isolation at home.

Wuhan is still detecting cases of new infection in people who carry the virus but show no outward signs of being sick. These so-called “asymptomatic” cases are now believed to have played an out-sized role in the epidemic’s stealthy spread.

That lingering apprehension is bad news for business. At Wuhan International Plaza, a luxury mall several blocks northwest of the Yangtze River, Yu, a sales assistant at Calvin Klein who would only give his last name, said the store had seen just two purchases since it re-opened on March 30. It used to see more than 20,000 yuan ($2,820) of sales each weekend.

“I’m actually happier if no one comes in,” he said. “It’s safer.”

Bloomberg

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