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Purchasing managers’ indexes for both manufacturing and service sectors drop to all-time lows
Steep falls raise questions over extent of damage epidemic has caused to China’s economy and how long it will take the country to recover
Many Chinese factories have faced a labour shortage as migrants have been unable to return to work because of the coronavirus outbreak. Photo: AFP
The damage caused by the coronavirus outbreak to China’s US$14 trillion economy could be much worse than Beijing hoped, as official measures for the country’s factory and service activity indicated on Saturday, threatening President Xi Jinping’s vision for 2020 and underscoring his urgent appeal to get production back to normal.
Monthly economic indicators for February sank to all-time lows as the coronavirus halted China’s manufacturing machine and froze activity in the service sector – from retailing to recycling – painting a bleak picture of the world’s second-biggest economy and challenging Beijing’s repeated assurance that the impact would be manageable and short-lived.
Covid-19, the disease caused by the coronavirus – was first reported in Wuhan in December. Since then it has spread to more than 50 countries and more than 85,000 people have been infected. The outbreak has disrupted travel and cargo shipments, and caused stock markets to slump.
China’s official February purchasing managers’ indexes (PMI) for both manufacturing and services, released by the National Bureau of Statistics on Saturday, confirmed fears that China’s economy was in bad shape and fanned speculation that it may even contract in the first quarter.
Larry Hu, chief China economist at Macquarie Capital in Hong Kong, said in a note that Beijing might report negative growth for “the first time since the Cultural Revolution”.
The manufacturing PMI, which measures factory activity, dropped to 35.7 in February – below the previous all-time low of 38.8 set in November 2008 during the global financial crisis – from 50 in January when the impact of the epidemic was not apparent.
A reading below 50 indicates a contraction in activity.
The February PMI figures confirmed fears that China’s economy was in bad shape. Photo: AFP
All of the sub-indexes of the PMI pointed to the difficult situation facing Chinese factories. Output plummeted, new orders vanished, exports and imports stopped, and logistics were badly disrupted. Input prices, which reflects the costs factories must pay, was the only sub-index that remained above 50.
The non-manufacturing PMI – a gauge of sentiment in the services and construction sectors – also dropped, to 29.6 from 54.1 in January. This was also the lowest on record, beating the previous low of 49.7 in November 2011, according to the China Federation of Logistics and Purchasing, which produces the index with the National Bureau of Statistics.
The declines in the February reflect the difficulties businesses are having in bringing production back online due to shortages of labour as well as difficulties receiving supplies or shipping goods to market because of transport restrictions enacted to contain the spread of the virus.
An extended slump would put upwards pressure on unemployment, especially among small, private sector service firms. Beijing, which worries that rising joblessness could cause social unrest, has called on local governments to remove unnecessary restrictions to get businesses back to work.
The employment sub-index in the manufacturing PMI fell to 31.8 in February.
“It is not because factories have stopped hiring migrant workers, it is because the flow of migrant workers to factories has been blocked,” said Hua Changchun, an analyst at brokerage Guotai Junan Securities. “There’s no point talking about resuming production if workers can’t return to their jobs.”
Zhang Qiqun, a researcher with the Development Research Centre of State Council, said in a statement that the major economic indicators for this quarter would see “obvious drops” and China must “be prepared”.
The employment sub-index in the manufacturing PMI fell to 31.8 in February. Photo: AFP
How quickly China can dig itself out of the coronavirus hole is a matter of debate.
According to the PMI survey, about 90 per cent of medium and large-sized manufacturers are expected to resume production in March, meaning about 10 per cent will still be closed four weeks from now.
As for small firms, the industry ministry said this week that two-thirds would still be closed at the end of February.
China’s production difficulties have resulted in economic problems for nations around the world that rely on supply chains that begin or pass through the country. The global spread of the coronavirus will only exacerbate the problem.
Barclays and Nomura forecast China’s first-quarter growth at 2 per cent, while Capital Economics said it would contract in year-on-year terms.
“The sharp drop in China’s manufacturing PMI in February reinforces our view that the normalisation in economic activity will be delayed,” said Xing Zhaopeng, an economist at Australia & New Zealand Banking Group.
“There’s scant chance for a V-shaped rebound – the authorities are using targeted aids more than stimulus to stabilise the economy and that will lead to a gradual bounce.”
The National Bureau of Statistics tried to put a brave face on the data, saying there would be a substantial improvement in March.
“The resumption of work is ramping up and market confidence is steadily recovering,” said Zhao Qinghe, a senior statistician at the NBS.
“Although the novel coronavirus pneumonia epidemic has caused a larger impact on production and operations of Chinese enterprises … currently the epidemic has come under initial containment, and the negative impact on production is gradually weakening.”
Around 200 Shincheonji Church of Jesus members continued to meet in the Chinese city amid rumours of virus, but ‘no one took [claims] seriously’ at first
Around half the Covid-19 cases in South Korea have been linked to members of the religious group
The Shincheonji church in Daegu has been linked to a cluster of infections. Photo: Yonhap via AP
Members of the Christian sect linked to a cluster of coronavirus cases in South Korea held meetings in Wuhan until December, only stopping when they realised that their community had been hit by Covid-19, the previously unknown disease caused by the virus.
The South China Morning Post has learned that the Shincheonji Church of Jesus in Wuhan, the Chinese city at the centre of the epidemic, has around 200 members, most of whom are currently under quarantine outside the city.
“Rumours about a virus began to circulate in November but no one took them seriously,” said one member, a 28-year-old kindergarten teacher.
“I was in Wuhan in December when our church suspended all gatherings as soon as we learned about [the coronavirus],” said the woman, who declined to be named because of the sensitivity of the matter.
She said the group was continuing to share sermons and teachings online, but most members had returned home at the start of the Lunar New Year holiday in late January.
The 250,000-member Shincheonji Church of Jesus is regarded by mainstream Christian groups as a secretive and unorthodox sect. Its founder, Lee Man-hee, has claimed that he is the second coming of Jesus Christ.
Around half the Covid-19 infections in South Korea have been linked to a branch of the church in Daegu.
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According to the Korea Centres for Disease Control and Prevention, there were 977 confirmed cases as of Tuesday – the second highest number outside China – and 11 deaths.
Of the 84 new cases reported on Tuesday, over half were recorded in Daegu city.
Coronavirus: Churches on high alert as South Korea confirms huge rise in infections
A member of the church from Daegu reportedly visited China in January, and health officials in South Korea are investigating whether a cluster of infections in Cheongdo city is linked to a three-day funeral ceremony held at a local hospital.
Chinese sources said that the Shincheonji church has about 20,000 members in China – most of whom live in major cities such as Beijing, Shanghai, Dalian, Changchun and Shenyang.
One Christian pastor in Hubei province, who declined to be named, said that Shincheonji church members were hard-working and some continued to proselytise even during the outbreak.
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The Wuhan kindergarten teacher said she was confident that the recent mass outbreaks in South Korea were not linked to Shincheonji church members from the city.
“I don’t think the virus came from us because none of our brothers and sisters in Wuhan have been infected. I don’t know about members in other places but at least we are clean. None of us have reported sick,” she said.
“There are so many Chinese travelling to South Korea, it’s quite unfair to pin [the disease] on us.”
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She sidestepped questions on whether church members had travelled from Wuhan to South Korea after the outbreak.
The teacher said that in 2018 the Wuhan group’s “holy temple” in Hankou district had been raided by police “who branded us a cult”, but members continued to worship in small groups.
“We are aware of all the negative reporting out there after the outbreak in South Korea, but we do not want to defend ourselves in public because that will create trouble with the government,” she said. “We just want to get through the crisis first.”
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Bill Zhang, a 33-year-old Shanghai resident and a former missionary with Shincheonji, said the group’s secretive nature made it hard for the authorities to effectively crackdown on its activities.
He said the Shanghai branch held its main meetings on Wednesdays and Saturdays, attracting 300 to 400 people at a time.
“The Shincheonji church in Shanghai has been raided many times and police spoke to church leaders regularly.
“But the church members simply continued their meetings in smaller groups of eight-to-10 people and regrouped when the surveillance was relaxed.”
Zhang continued: “Shincheonji holds that it is the only real church that upholds the biblical truth and all other churches – mainstream or cults – are evil.”
Chinese State Councilor and Foreign Minister Wang Yi holds talks with Serbian First Deputy Prime Minister and Foreign Minister Ivica Dacic at the Diaoyutai State Guesthouse in Beijing, capital of China, Feb. 26, 2020. (Xinhua/Huang Jingwen)
BEIJING, Feb. 26 (Xinhua) — Chinese State Councilor and Foreign Minister Wang Yi held talks with Serbian First Deputy Prime Minister and Foreign Minister Ivica Dacic Wednesday in Beijing.
Wang said that China and Serbia are like-minded brothers who stick with each other through thick and thin, good partners in jointly promoting the Belt and Road Initiative and good friends in advancing China-Europe cooperation.
He called on both sides to uphold the open and inclusive multilateralism, oppose any kind of bullying, and work together with the international society to build a community of shared future for mankind.
Noting that the comprehensive strategic partnership between the two countries has been operating at a high level, Dacic said the novel coronavirus epidemic has not affected bilateral pragmatic cooperation in all fields.
The Serbian side openly and firmly supports the one-China principle, as well as China’s core interests and major concerns on Taiwan, Xinjiang and Hong Kong issues, he said.
SEOUL/BEIJING (Reuters) – South Korea aims to test more than 200,000 members of a church at the centre of a surge in coronavirus cases, as countries stepped up efforts to stop a pandemic of the c that emerged in China and is now spreading in Europe and the Middle East.
More than 80,000 people have been infected in China since the outbreak began, apparently in an illegal wildlife market in the central city of Wuhan late last year.
China’s death toll was 2,663 by the end of Monday, up 71 from the previous day. But the World Health Organization (WHO) has said the epidemic in China peaked between Jan. 23 and Feb. 2 and has been declining since.
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However, fast-spreading outbreaks in Iran, Italy and South Korea, and first cases in several Middle East countries, have fed worries of a pandemic, or worldwide spread of the virus.
“We are close to a pandemic, but there is still hope the epidemics in Iran, Italy, South Korea, etc. can be controlled,” said Raina MacIntyre, head of the Biosecurity Programme at the Kirby Institute at the University of New South Wales.
South Korea has the most virus cases outside China and reported its tenth death and 144 new cases, for a total of 977. President Moon Jae-in said the situation was “very grave”.
In Europe, Italy has become a new front line, with 220 cases reported on Monday, up from just three on Friday. The death toll in Italy is seven.
Global stock markets stabilised on Tuesday after a wave of early selling petered out and Wall Street futures managed a solid bounce after a sharp selloff the previous day on fears about the spreading coronavirus.
“If travel restrictions and supply chain disruptions spread, the impact on global growth could be more widespread and longer lasting,” said Jonas Goltermann, senior economist at research consultancy Capital Economics in London.
PUBLIC ANXIETY
About 68% of South Korea’s cases are linked to the Shincheonji Church of Jesus, where the outbreak is believed to have begun with a 61-year-old woman. It is not known how she became infected.
The church said it would provide authorities the names of all its members in South Korea, estimated by media at about 215,000 people. The government would test them all as soon as possible, the prime minister’s office said.
“It is essential to test all of the church members,” it said in a statement. Authorities said they were testing up to 13,000 people a day.
The U.S. and South Korean militaries have said they may cut back joint training due to the virus, in one of the first concrete signs of its fallout on global U.S. military activities.
The disclosure came during a visit to the Pentagon on Monday by South Korean Defence Minister Jeong Kyeong-doo, who said 13 South Korean troops had the virus.
The U.S. military said a woman who tested positive for the virus had visited one of its bases in the hard-hit city of Daegu. It was the first infection connected to U.S. Forces Korea, which has about 28,500 American troops on the peninsula.
The U.S. military urged troops to “use extreme caution” off base, while the U.S. Centers for Disease Control and Prevention said Americans should avoid non-essential travel to South Korea.
IRAN ISOLATION
Outside mainland China, the outbreak has spread to about 29 countries and territories, with a death toll of about three dozen, according to a Reuters tally.
Afghanistan, Bahrain, Iraq, Kuwait and Oman reported their first new coronavirus cases, all in people who had been to Iran where the toll was 14 dead, media said, and 61 infected.
The outbreak threatens to isolate Iran further. The United Arab Emirates, which has 13 virus cases, suspended all flights with Iran for at least a week, state media said.
Iraq extended an entry ban on travellers from China and Iran to those from five other countries over virus fears, its health ministry said.
In Japan, which has reported four deaths and 850 cases mostly linked to a cruise ship, Health Minister Katsunobu Kato said it was too early to talk about cancelling the Tokyo Olympics due to start on July 24.
The United States pledged $2.5 billion to fight the disease, with more than $1 billion going toward developing a vaccine, with other funds earmarked for therapeutics and the stockpiling of personal protective equipment such as masks.
China reported a rise in new cases in Hubei province, the epicentre of the outbreak. But excluding those, China had just nine new infections on Monday, its fewest since Jan. 20.
With the pace of new infections slowing, Beijing said restrictions on travel and movement that have paralysed economic activity should begin to be lifted.
“Low-risk areas … are to restore order in production and life, cancel transport restrictions and help enterprises,” state planner official Ou Xiaoli told a briefing.
Image copyright GETTY IMAGESImage caption Mr Gui has been in and out of Chinese detention for years
A Chinese court has sentenced Hong Kong bookseller Gui Minhai to 10 years in jail for “illegally providing intelligence overseas”.
Mr Gui, who holds Swedish citizenship, has been in and out of Chinese detention since 2015, when he went missing during a holiday in Thailand.
He is known to have previously published books on the personal lives of Chinese Communist Party members.
Rights groups condemned the “harsh sentence” and called for his release.
He was one of five owners of a small bookstore in Hong Kong who went missing in 2015. It later emerged that they had been taken to China. Four were later freed, but Mr Gui remained in Chinese detention.
In delivering its verdict, the Ningbo Intermediate People’s Court said that his Chinese citizenship had been reinstated in 2018. China does not recognise dual citizenship.
Sweden’s foreign minister on Tuesday called for Mr Gui’s release, referring to him a “citizen”.
“We have not had access to the trial,” said Ann Linde in a tweet. “[We] demand that Gui be released and that we have access to our citizens to provide consular support.”
But according to a Reuters report, a Chinese foreign ministry spokesman said consular arrangements had been put on hold because of the latest coronavirus outbreak, and would be restored once the health problem was “resolved”.
Zhao Lijian added that Mr Gui’s “rights and interests… [had] been fully guaranteed”.
Human rights group Amnesty International on Tuesday also called for Mr Gui to be released immediately and said the charges were “completely unsubstantiated”.
A forced confession?
Mr Gui first made headlines in 2015 when he vanished from Thailand and resurfaced in China.
After his disappearance, there were allegations that he had been abducted by Chinese agents. Chinese officials, however, say Mr Gui and the four other men all went to China voluntarily.
The bookseller ultimately confessed to being involved in a fatal traffic accident more than a decade earlier – a confession supporters say was forced.
He served two years in prison but he was arrested months after his release while he was travelling to the Chinese capital of Beijing with two Swedish diplomats.
China later released a video interview featuring Mr Gui. In it, he accused Sweden of “sensationalising” his case. It is not uncommon for Chinese criminal suspects to appear in “confessional” videos.
Earlier in 2019, Sweden recalled its ambassador to China Anna Lindstedt, who was accused of brokering an unauthorised meeting between Angela Gui – the daughter of Mr Gui – and two Chinese businessmen.
Ms Gui – who has been vocal in campaigning for her father’s release – said one of the men had pressured her to accept a deal where her father would go to trial and might be sentenced to “a few years” in prison, and in return she would stop all publicity around her father’s detention.
NEW DELHI (Reuters) – U.S. President Donald Trump said on Tuesday that India will buy $3 billion worth of military equipment, including attack helicopters, as the two countries deepen defence and commercial ties in an attempt to balance the weight of China in the region.
India and the United States were also making progress on a big trade deal, Trump said. Negotiators from the two sides have wrangled for months to narrow differences on farm goods, medical devices, digital trade and new tariffs.
Trump was accorded a massive reception in Indian Prime Minister Narendra Modi’s home state on Monday, with more than 100,000 people filling into a cricket stadium for a “Namaste Trump” rally.
On Tuesday, Trump sat down for one-on-one talks with Modi followed by delegation-level meetings to try and move forward on issues that have divided them, mainly the festering trade dispute.
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After those meetings, Trump said his visit had been productive with the conclusion of deals to buy helicopters for the Indian military. India is buying 24 SeaHawk helicopters from Lockheed Martin equipped with Hellfire missiles worth $2.6 billion and also plans a follow-on order for six Apache helicopters.
India is modernising its military to narrow the gap with China and has increasingly turned to the United States over traditional supplier, Russia.
Trump said the two countries were also making progress on a trade deal, which had been an area of growing friction between them.
“Our teams have made tremendous progress on a comprehensive trade agreement and I’m optimistic we can reach a deal that will be of great importance to both countries,” said Trump in remarks made alongside Modi.
The two countries had initially planned to produce a “mini deal”, but that proved elusive.
Instead both sides are now aiming for a bigger package, including possibly a free trade agreement.
Trump said he also discussed with Modi, whom he called his “dear friend”, the importance of a secure 5G telecoms network in India, ahead of a planned airwaves auction by the country.
The United States has banned Huawei, arguing the use of its kit creates the potential for espionage by China – a claim denied by Huawei and Beijing – but India, where telecoms companies have long used network gear from the Chinese firm, is yet to make a call.
Trump described Monday’s rally in Ahmedabad and again praised Modi and spoke of the size of the crowd, claiming there were “thousands of people outside trying to get in..
“I would even imagine they were there more for you than for me, I would hope so,” he told Modi. “The people love you…every time I mentioned your name, they would cheer.”
In New Delhi, Trump was given a formal state welcome on Tuesday at the red sandstone presidential palace with a 21-cannon gun salute and a red coated honour guard on horseback on a smoggy day.
HUG GETS TIGHTER
India is one of the few big countries in the world where Trump’s personal approval rating is above 50% and Trump’s trip has got wall-to-wall coverage with commentators saying he had hit all the right notes on his first official visit to the world’s biggest democracy.
They were also effusive in their praise for Modi for pulling off a spectacular reception for Trump.
“Modi-Trump hug gets tighter,” ran a headline in the Times of India.
But in a sign of the underlying political tensions in India, violent protests broke out in Delhi on Monday over a new citizenship law that critics say discriminates against Muslims and is a further attempt to undermine the secular foundations of India’s democracy. They say the law is part of a pattern of divisiveness being followed by Modi’s Hindu nationalist Bharatiya Janata Party.
At least 7 people were killed and about 150 injured in the clashes that took place in another part of the capital, away from the centre of the city where Modi is hosting Trump.
In his speech on Monday, Trump extolled India’s rise as a stable and prosperous democracy as one of the achievements of the century. “You have done it as a tolerant country. And you have done it as a great, free country,” he said.
Delhi has also been struggling with high air pollution and on Tuesday the air quality was moderately poor at 193 on a government index that measures pollution up to a scale of 500. The WHO considers anything above 60 as unhealthy.
BEIJING, Feb. 24 (Xinhua) — With the positive trend of containing the outbreak of novel coronavirus illness (COVID-19), China is meticulously expanding business operations with a precise approach that attaches different priorities to regions in light of their health risks.
A total of 11 newly confirmed cases of COVID-19 were reported Sunday outside Hubei Province, the center of the outbreak, while 24 provincial-level regions didn’t report newly confirmed cases, according to the National Health Commission Monday.
As more provincial-level regions have been reporting no newly confirmed cases for longer streaks, more local governments are starting to lower their emergency response to fast-track the restoration of economic and social order.
While high-risk regions still need to be fully committed to epidemic prevention and control, regions with relatively low risks are encouraged to focus on forestalling cases brought in from elsewhere and comprehensively restoring the order of production and life, said a meeting Sunday.
Coastal province Fujian has divided the 88 cities and counties into four groups, ranging from regions with over ten infections to regions with none, and adopted differentiated measures to better fight the outbreak and mitigate the impact on the economy.
Changting County in Fujian, for instance, which has no confirmed cases of infection, has seen most of the key enterprises resume production.
The country has pledged efforts such as arranging customized trains for migrant workers, smoothing the traffic, enhancing credit support and alleviating social security burden on employers to bring enterprises back on track.
Shanghai Municipality has rolled out 28 policies to provide targeted fiscal support, tax and fee cuts, as well as epidemic-prevention supplies for local enterprises, ferrying them through rough patches.
Foreign companies will also benefit from the supportive policies and be treated on the same footing as other types of enterprises, said Xu Wei, spokesperson for the Shanghai municipal government.
The operation resumption rate of 51,000 foreign-funded enterprises in Shanghai is nearly 70 percent, while that of the regional headquarters of 217 multinational companies is as high as 93 percent.
Wyeth Nutrition, a Sino-U.S. joint venture with its headquarter in Shanghai, is operating at its capacity to supply infant formula in China.
“The local commerce department has built a green channel for us, ensuring smooth operation of our supply chains and product delivery in the Yangtze River Delta,” said Cao Jingheng, vice president of the company.
Foreign firms and firms are high on the agenda of Chinese government agencies when formulating preferential policies.
The Ministry of Commerce has promised to strengthen services and guarantees to foreign-funded enterprises while the General Administration of Customs vowed efforts to optimize the port business environment and promote reciprocal market opening up.
Now with the country gradually heading back to work, many are confident that the potential economic blow brought by the national production halt is expected to be only a short-term, one-off hit against China’s solid economic foundation.
The epidemic might disturb economic activities in the first quarter of this year, but the economy is likely to steady shortly after the epidemic is contained, as the unleashing of pent-up demands will make up for previous weak economic performance, said Pan Gongsheng, vice governor of the People’s Bank of China, the central bank.
International Monetary Fund Managing Director Kristalina Georgieva said Saturday that she expects China’s economy to “return to normal in the second quarter” of 2020.
“As a result, the impact on the world economy would be relatively minor and short-lived,” Georgieva said.
State-owned carrier’s chief says it wouldn’t be ‘morally acceptable’ to stop flying to the country, and it will stand with its ‘Chinese brothers and sisters’
Dozens of airlines have cancelled or reduced services to the nation amid the virus outbreak, including two East African rivals
Ethiopian Airlines says it will continue flying to China. The routes are among its most profitable. Photo: Shutterstock
Ethiopian Airlines, Africa’s largest and most profitable carrier, will continue flying to China despite growing pressure for it to suspend services to the country as
Dozens of airlines around the globe have cancelled or reduced their services to cities in the world’s second-largest economy amid fears over the outbreak. Its East African rivals Kenya Airways and RwandAir have both suspended flights to China until the outbreak is contained.
But Ethiopian Airlines chief executive Tewolde GebreMariam said the carrier would not abandon the routes, which are among its most profitable.
Tewolde told media over the weekend that the airline had been flying to China since 1973 and it would not be ethical to suspend flights to the country.
“It will not be morally acceptable to stop flying to China today because they have a temporary problem,” he said, adding that the airline would stand with its “Chinese brothers and sisters”.
His remarks came days after Kenyan President Uhuru Kenyatta put pressure on the Ethiopian government – which wholly owns Ethiopian Airlines – to halt flights to China, citing the need to curb the spread of the virus into the East African region.
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The airline has bucked a trend that has seen major airlines – from the United States to Europe and Asia – staying away from Chinese airspace as governments around the world move to keep the deadly virus from their borders. The pneumonia-like illness has so far
in mainland China since the outbreak began in Wuhan in December, with cases reported in more than 20 other countries worldwide.
Speaking during a visit to Washington last week, Kenyatta – who is keen to court both China and the US – insisted that Kenya’s decision to suspend flights from Guangzhou to Nairobi was not political.
He said most African countries had weak health systems that would make it harder to handle the outbreak, so preventing its spread – even if through extreme measures such as grounding flights – was the only option.
“Our worry as a country is not that China cannot manage the disease. Our biggest worry is diseases coming into areas with weaker health systems like ours,” Kenyatta said while addressing members of US think tank the Atlantic Council.
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But Ethiopian Airlines said it would continue flying to Beijing, Shanghai, Guangzhou, Chengdu and Hong Kong and was taking measures to protect staff and passengers. Ethiopia receives about 1,500 visitors from mainland China every day.
According to Tewolde, if the airline halted its Chinese services, China and Africa would be completely disconnected.
“No one in Ethiopian Airlines would like to see this,” he said. “We have to take maximum precautions, but stopping flights is not one of them.”
He added: “Even if we stop flying, people will continue to come to Ethiopia through Singapore, Malaysia, Europe. The transmission of the disease will be dangerously hidden … British Airways stopped flying to China for its economic reasons. But Chinese carriers are flying to the UK.”
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In a separate statement, the carrier said China was “one of the strongest and one of the oldest markets for Ethiopian Airlines”.
“We have been connecting the great Chinese nation with the entire continent of African for almost half a century and it is our growth strategy,” the airline said, adding that it would continue operating in the five cities in compliance with international aviation and health guidelines.
Aside from seeking to shore up revenues, analysts noted that the airline was under tight state control, and Ethiopia would be reluctant to do anything that might harm its strong bilateral ties with China.
Ethiopia is among the nations on the continent with the highest number of Chinese immigrants. Most of them are workers involved in the construction of infrastructure projects including ports, railways, dams, bridges and malls. Those projects have been financed with billions of dollars in loans from China – Ethiopia is reportedly among the biggest recipients of Chinese lending in Africa.
Last year, China was forced to restructure Ethiopia’s debt after the latter edged closer to defaulting on a loan from Beijing for its standard gauge railway.
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Ethiopia, Algeria, Angola, Nigeria and Zambia together accounted for nearly 60 per cent of all Chinese workers on the continent at the end of 2017, according to a study by Johns Hopkins University.
Ethiopia is also a major recipient of direct foreign investment from China.
An insect-killing fungus has been turned into a mass-produced biopesticide that will face its biggest challenge in East Africa
Current swarm has put 13m people at risk of famine and this will be the first large-scale test of its effectiveness
Young locusts in Somalia, where the fungus will be used to try to kill them. Photo: AP
Chinese factories are producing thousands of tonnes of a “green zombie fungus” to help fight the swarms of locusts in East Africa.
Metarhizium is a genus of fungi with nearly 50 species – some genetically modified – that is used as a biological insecticide because its roots drill through the insects’ hard exoskeleton and gradually poisons them.
In China it was named lu jiang jun, which means green zombie fungus, because it gradually turns its victims in a green mossy lump.
There are now dozens of factories across the country dedicated to producing its spores and despite the curbs introduced to stop the spread of Covid-19, many of them have resumed operations and are shipping thousands of tonnes to Africa.
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These factories are set up in a similar way to breweries, growing the spores on rice which is kept in carefully controlled conditions to ensure the correct temperature and humidity.
Each plant can produce thousands of tonnes of fungi powder per year, each gram of which contains tens of billions of spores.
“I am sending off a truckload right now. Our stock is running out,” said the marketing manager of a production plant in Jiangxi province. “Some customers need it urgently. They need it to kill the locusts.”
The need is particularly pressing in East Africa at the moment, where abnormally high levels of rainfall during the dry season allowed hundreds of billions of locusts to hatch in recent months.
So far the swarms have devastated crops in countries such as Ethiopia, Kenya, Somalia and Uganda and are moving on to neighbouring countries.
Up to 13 million people face the risk of famine in East Africa. Photo: AFP
The UN’s Food and Agriculture Organisation (FAO) has warned the situation could be the “worst in decades” and the resulting famine may affect 13 million people and cause international food prices to soar.
Last week, Science magazine reported that the Somalian government, working with the FAO, was preparing to a metarhizium species that only kills locusts and grasshoppers in what it described as the largest ever use of biopesticides against the insects.
Scientists do not believe that the fungus will be enough to solve the problem – monitoring the outbreak and targeting their breeding grounds will be more important in the long-run – but if it proves effective it could be an important weapon to target future outbreaks.
It will take time to gauge the effectiveness, partly because each fungus will take several days to take effect and partly because of the sheer scale of the challenge; a single swarm in Kenya was estimated to contain between 100 billion and 200 billion locusts.
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The locusts have also swept eastward into the Middle East, travelling up to 150km (90 miles) a day, and are moving closer to China now that they have now reached some of its neighbours, including India and Pakistan.
At present China’s agriculture ministry believes some locusts may follow the monsoon into the country but “the chances of them causing damage is very small”.
Most scientists agree the swarms will not have lasting effect on food production but say developing countries can tap into China’s cutting-edge anti-locust technology.
Radar stations have been set up all the way along China’s western and southern borders to detect possible clouds of locusts, while unmanned devices lure the insects into traps to collect data about their species population and size.
A locust being eaten inside out by the metarhizium fungi. Photo: Chinese Academy of Sciences and the University of Maryland
The data is streamed to the ministry’s programme command, which is responsible for the planning and coordination of the national efforts to prevent an outbreak.
The scientists also said that planes loaded with biological and chemical sprays were standing by.
Today, most locust outbreaks happen in developing countries that do not have advanced monitoring networks and some of them are unable to produce pesticides on a mass scale, according to Li Hu, an associate professor with the China Agricultural University in Beijing.
The Chinese locust treatment technologies were highly advanced, and usually cheaper than competing solutions from the West, he said.
Chinese researchers are now working with colleagues in other countries to help them solve the problem.
One disadvantage of the Chinese research is that it is mostly focused on local species, or the East Asia migratory locust. The desert locusts currently swarming East Africa have different genes and behaviour, and Li warned that some methods that work in China might not work elsewhere.
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There were some sightings of the species reported in Yunnan and Tibet in the past, but they did not build up to large colonies, Professor Kang Le, lead scientist of the locust research programme with the Institute of Zoology at the Chinese Academy of Sciences in Beijing, told China Science Daily last week.
The vast west China region of Xinjiang, which shares a border with eight countries, is currently too cold for a locust migration, but once temperatures start to rise in the spring it could see locusts swarming across the border with Afghanistan.
Shi Wangpeng, a senior government locust expert, told China Business Network on Sunday that China should be on high alert because many Afghan farms had already been affected.
“These areas share a long border with us, there are almost no barriers,” he was quoted as saying by the Shanghai-based magazine.
China has a long and bitter history of locust swarms, with more than 840 being recorded in the official records over the past 2,700 years.
One famine, in the year 628 was so devastating that even the Tang dynasty emperor Taizong was reported to have run short of food and resorted to eating the insects to survive.
China has a long and bitter history of locust swarms. Photo: AFP
This, in turn, means that China’s rulers have long been looking for innovative ways to solve the problem
In the past farmers tried remedies such as building huge fires, burying the insects in ditches or trying to kill them with sticks.
In one campaign organised by prime minister Yao Chong in 715, the farms collected 9 million sacks of dead locusts and managed to save a significant proportion of their crops, according to historic text.
In more recent times more sophisticated technologies have been deployed to tackle the menace.
Some researchers have spent decades chasing locust colonies and studying their individual and collective behaviour everywhere from coastal areas to inland deserts, and in 2014 Chinese scientists released the world’s most comprehensive genetic map of locusts.
Researchers have also developed chemical agents that can disorient swarms of locusts and disperse them.
Chinese scientists first became interested in the green zombie’s potential in the 1980s after discovering that South Pacific islanders had been using them to kill insects on coconut trees.
Research by US scientists confirmed its effectiveness in the 1990s and the Chinese started importing the fungus from the United States and Britain.
Their experiments led to the development of newer and deadlier strains and mass production started in the past decade.
Other fungi or bacteria can be used to fight locusts, and some laboratories are working with agricultural technology companies to modify their genes to turn them into more deadly or precise killers.
One genetically engineered species of microsporidia, another type of insect-killing fungus, for instance, can generate three times as many as the spores to those produced by nature species, according to a document from the China Association of Agricultural Science Societies last year.
While it remains to be seen whether the current swarms will reach China, these treatments have been effective in the past and there has not been a locust outbreak in China for a decade.
Power-sharing agreement between rebel leader Riek Machar and President Salva Kiir gives hope to ending the conflict
Beijing has invested tens of millions of dollars in the country’s oilfields and sent more than 1,000 peacekeeping troops there
Rebel leader Riek Machar (left) and President Salva Kiir greet each other after the swearing-in ceremony at the State House in Juba on Saturday. Photo: AP
Beijing has welcomed “encouraging developments” in the South Sudan peace process after rebel leader Riek Machar and President Salva Kiir agreed to form a transitional coalition government.
Machar, the Sudan People’s Liberation Movement-In Opposition (SPLM-IO) leader, was among four vice-presidents sworn in on Saturday in the capital, Juba, in a power-sharing deal that gives hope to ending the more than six years of conflict which has killed some 400,000 people and displaced millions more.
“The Chinese side commends and welcomes these encouraging developments, especially the crucial consensus reached between President Kiir and Machar,” the Chinese embassy in Juba said in a statement.
Stability in South Sudan is important for China, which has invested tens of millions of dollars in the country’s oilfields as it seeks to meet energy needs at home. China National Petroleum Corporation (CNPC) owns a 41 per cent stake in South Sudan’s largest oil consortium, Dar Petroleum Operating Company, while Sinopec, another Chinese state-owned firm, holds a 6 per cent stake.
Stability in South Sudan is important for China, which has major investments in the country’s oilfields. Photo: Reuters
China has also sent more than 1,000 troops to the United Nations’ peacekeeping mission in South Sudan, and has not followed the United States and other Western nations in imposing sanctions on leading political and military figures.
“We trust that the relevant parties of South Sudan will resolve the remaining issues in the spirit of mutual trust and understanding, and start a new chapter in the history of South Sudan,” the embassy statement added.
China has offered to help rebuild the country, promising to supply a unified security force that is supposed to be formed from the rival factions as part of the peace process. It has also helped to set up military camps to accommodate both government troops and members of the armed opposition.
Since the peace deal was signed between Kiir and rebel factions in September 2018, China said it had provided diplomatic and other support to military camps and training centres including 1,500 tonnes of rice, 2,500 tents, 50,000 blankets and 1,440 boxes of medicine.
Riek Machar (right) is sworn in as the first vice-president of South Sudan. Photo: AFP
Machar was sworn in as the first vice-president alongside three others – James Wani Igga, Taban Deng Gai and Rebecca Nyandeng. Gai, a former ally of Machar who switched to the government side, was recently sanctioned by the US over serious human rights abuses. Nyandeng is the widow of John Garang, who led a long struggle for independence from Sudan before he died in a helicopter crash in 2005.
“I have forgiven my brother Riek Machar. I also ask for his forgiveness and I also forgive all those who still are holding out on this peace agreement,” Kiir said at a ceremony at the State House attended by regional leaders and diplomats.
After the swearing-in, Machar vowed to work together to end the suffering of South Sudanese.
“I reiterate my commitment to work closely with President Kiir to implement the agreement in letter and spirit,” Machar said.
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The South Sudanese have seen more war than peace since the East African nation – whose oilfields contribute about 98 per cent of the government’s revenue – seceded from the Republic of Sudan in 2011. Kiir and Machar formed the independent government but disagreements followed, leading to Machar’s sacking, sparking a bloody war along ethnic lines.
They again agreed to work together in 2015, but the deal fell apart a year later following renewed fighting. After international pressure and peace talks, a new deal was signed in September 2018, but Kiir and Machar have had to push back two deadlines to form the coalition government as they could not agree on issues such as having a unified army and the number of states – highly contentious since it affects the control of oil-rich regions. Machar also wanted his security assured.
On Thursday, Kiir said he had agreed to abolish the 32 states he created in 2015 and revert to the original 10 states.
According to a report released last week on China’s approach to UN peacekeeping in the region, Beijing had used its “economic leverage” in South Sudan.
“China has used its leverage to encourage the government and the opposition parties to negotiate, to come to an agreement, and to implement the ceasefire agreements,” said the report by the Norwegian Institute of International Affairs. “It has reportedly used its economic leverage by signalling that it would be unable to renew and expand its support to the South Sudanese government and the economy as long as the fighting was ongoing.”
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South Sudan had also provided an opportunity for Chinese soldiers to put their skills to the test on overseas missions and during armed conflict.
“South Sudan became a real-world laboratory [for China] to test the boundaries of its non-interference principle,” the report said.
Obert Hodzi, an international relations lecturer at the University of Liverpool in England, also said earlier that it was a way for China’s military to get the combat experience it needed.
“South Sudan provides ample opportunities for different segments of the Chinese army to practise, test their equipment and ability to conduct successful missions abroad,” Hodzi said.
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