The workshop of the world is closed. China is on a total-war footing. The Communist Party has evoked the ‘spirit of 1937’ and mobilized all the instruments of its totalitarian surveillance system to fight both the Coronavirus, and the truth. Make GDP forecasts if you dare.
As of this week two-thirds of the Chinese economy remains shut. Over 80pc of its manufacturing industry is closed, rising to 90pc for exporters.
Equity markets are instead shrugging off the Wuhan virus as media noise, betting that China’s factories will reopen on February 14 or thereabouts as Beijing brings the epidemic under control.
This is a brave assumption and I can only marvel at analysts suggesting that the infection rate may be tailing off based on each day’s official data. Are they aware of the astonishing accounts of Kafkaesque reality in Wuhan, Huanggang, and soon no doubt the 35m-strong megalopolis of Chongqing, where Britain has just closed its consulate?
Are they reading dispatches by Caixin or the South China Morning Post revealing a desperate shortage of testing kits and tales of the walking afflicted (transport has been shut down) queuing for hours at hospitals, only to be turned away and sent home to die undiagnosed.
These glimpses of truth are about to vanish. The propaganda police have ordered those within their direct reach to conduct an “editorial review”. Stories are being censored aggressively. Outsiders will be silenced in subtler ways.
The coronavirus numbers are patently fiction. Far more have died than the official tally of 493. A Lancet study last week by the University of Hong Kong estimated that the Chinese authorities have understated the epidemic tenfold. This was based on a spread rate of 2.68 per case and a doubling in total numbers every 6.4 days, matched with known travel movements within China and globally since the outbreak.
It calculated even then that the true figure for Wuhan was likely to be 76,000, and that Chongqing, Changsha, Nanchang, are already riddled with the disease. “Independent self-sustaining outbreaks in major cities globally could become inevitable,” it said.
Views differ but it is striking how many global experts – when not under political pressure – say it may already be too late to stop the spread. “It’s very, very transmissible, and it almost certainly is going to be a pandemic,” said Anthony Fauci, head of the US National Institute of Allergy and Infectious Disease.
There is an inherent contradiction in the market’s nonchalance. Yes, it is possible that China’s 50-million lockdown and use of extreme surveillance and coercive power will accelerate the process of “contact tracking”, catching enough of those infected before they can spread it further. Such a hi-tech totalitarian response to an epidemic has never been tried before.
But the more thoroughly China enforces this, the greater the global economic shock is likely to be. How can industrial plants really be reopened next week?