As part of China’s coronavirus elimination strategy, Beijing has imposed more than 18 months of strict border security, including three-week quarantine stays and fewer visas for businessmen and their families.
The rules have been credited for helping suppress coronavirus outbreaks and reducing the death toll from the pandemic. But a worsening outbreak of the Delta coronavirus variant has caused a return to local lockdowns and travel bans after spreading to two-thirds of regions in China.
With no articulated exit strategy and as the rest of the world reopens, US business leaders have warned Beijing that it risks accelerating the exodus of foreigners from China.
Ker Gibbs and Alan Beebe, the presidents of the US chambers of commerce based in Shanghai and Beijing respectively, are among a growing number of businessmen in China leaving their jobs in the coming months.
“China has developed rapidly thanks to the hard work and entrepreneurship of the Chinese people, [but] it is also true that opening up to the outside world has played an important role, ”said Gibbs, a veteran of affairs in China leaving his role earlier than initially expected.
“By allowing foreign capital, ideas and management expertise to enter China, the country has accelerated its transition to one of the world’s largest and most advanced economies,” he said.
A recent survey of 338 AmCham Shanghai member companies in China found that more than 70% had difficulty attracting and retaining foreign talent, with “Covid-related travel restrictions” being the main problem.
“Getting business leaders – and their families – in and out of China has been extremely difficult since the start of the global pandemic,” Gibbs said.
Strict quarantine protocols, including rare episodes of mothers separated from their children, have further scared some expats. The removal of the preferential tax treatment that foreigners have enjoyed for decades and the rising cost of living in Chinese cities were also cited as major concerns.
Aside from fewer expats to China, there has been “an almost complete decline in foreign students,” another blow to the “people-to-people exchanges” that have been an important pillar of U.S.-China diplomacy ever since. decades, he said.
Beebe could not be reached for comment.
Fears that travel restrictions could extend until the end of 2022 have compounded uncertainty for many.
Foreign spectators will not be allowed at the February Winter Olympics. Many businessmen now expect China to prioritize enhanced security – and subsequently sealed borders – ahead of a major party convention at the end of next year, when Xi s ‘is about to take up a historic third term as president.
“Given the success of current containment policies and popular support for restricting international travel, it is extremely likely that China will continue with its national zero tolerance strategy and strict quarantine requirements for international travel for at least a year. Said Ernan Cui, a Chinese. analyst at Gavekal, consulting firm.
China, using its locally produced Covid vaccines, said it has completely inoculated more than a billion of its population of 1.4 billion. The official death toll from the coronavirus in the country stands at less than 5,000. This compares to more than 730,000 in the United States and 140,000 in the United Kingdom.
Still, a series of outbreaks of the highly infectious Delta variant in recent weeks has complicated the outlook. Parts of several northern cities, including Beijing, are closed, raising concerns among officials ahead of the Winter Games.
One of those cases was attributed to a single person who returned from a domestic trip to Beijing and spread the virus during a game of mahjong, officials said. Foreign language tests were among the events canceled in the Chinese capital over the past week.
Businesses are also struggling to retain foreign workers in Hong Kong due to the pandemic’s tight controls. The number of U.S. businesses using the city as their regional headquarters has fallen 10% to 254 this year from 2020, an 18-year low.
In another sign of the growing pressures facing the international business community in China, the Southwest China American Chamber of Commerce, based in Chengdu, has been forced to suspend its activities in recent months.
Chinese officials cited a rule in August that each country can only have one registered room to justify the shutdown.
The US State Department called the move “only the latest example” of how “China’s opaque and arbitrary regulatory environment contributes to an investment climate increasingly hostile to foreign companies.”
Additional reporting by Emma Zhou in Beijing