The United States and Europe have begun to coexist with the emerging coronavirus (Covid-19), but China's "zero-Covid" strategy may affect supply chains.

And the American newspaper, “The Wall Street Journal”, said that the direct economic impact of the mutated Omicron strain of the Corona virus in the countries most vaccinated its population appears modest and relatively short-lived, but its indirect impact may appear significant if China resorts to repeated closures in its quest. To curb the spread of the virus within its territory.

The Omicron mutant led to a resurgence of infections wherever it spread, a rise in the number of deaths, and business disruptions as workers sought medical treatment or quarantine.

However, it has become clear that Omicron infects vaccinated people with milder symptoms compared to previous strains of the virus, and that an increasing number of European countries have lifted the restrictions they imposed when the mutation appeared, according to the American newspaper.

U.S. job growth accelerated in January, even though the number of people out of work due to the pandemic has more than doubled since last December.

China is in danger

The newspaper pointed out that the lifting of restrictions or their absence in Europe and the United States indicates an increasing desire to coexist with the virus, although it remains on alert in anticipation of the dangers that may result from it, but this is not an option yet in areas whose residents have received vaccines that provide only limited protection. This is one of the reasons why China continues to adopt a “zero-Covid” strategy, which requires strict lockdown measures in the event of a local outbreak.

The newspaper quotes Frederic Carrier, director of investment strategy at RBC Wealth Management, as saying that the imposition of additional restrictions in the time of the pandemic would cause more obstacles to supply chains, curb the return of the global economy to its normal state, exacerbate global inflation, and limit the growth of Chinese economy.

New, long-term lockdowns in China could undo its progress and might even be a major drag on growth.

In this, Gita Gopinath, Deputy Director-General of the International Monetary Fund, says that China's "zero Covid" strategy may exacerbate obstacles to supplies globally.

China is the world's leading supplier of parts that other manufacturers use in the production of household goods, which economists have termed "intermediate goods".

According to the World Trade Organization, Chinese companies sold $334 billion in intermediate goods to overseas buyers in the three months to June 2021, much more than the second-largest exporter - the United States - with $200 billion in sales.

The United States is the largest market for China's exports of intermediate goods, and South Korea, Japan, Germany and India also account for a large share.