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World

Chinese rush to renew passports as COVID border curbs lifted

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  • China dropped quarantine for visitors on Sunday
  • Latest move in easing that has let virus run free
  • Several nations demand COVID tests from China travellers
  • Chinese stocks, yuan rally on growth hopes

BEIJING, Jan 9 (Reuters) – People joined long queues outside immigration offices in Beijing on Monday, eager to renew their passports after China dropped COVID border controls that had largely prevented its 1.4 billion residents from travelling for three years.

Sunday’s reopening is one of the last steps in China’s dismantling of its “zero-COVID” regime, which began last month after historic protests against curbs that kept the virus at bay but caused widespread frustration among its people.

Waiting to renew his passport in a line of more than 100 people in China’s capital, 67-year-old retiree Yang Jianguo told Reuters he was planning to travel to the United States to see his daughter for the first time in three years.

“She got married last year but had to postpone the wedding ceremony because we couldn’t go over to attend it. We’re very glad we can now go,” Yang said, standing alongside his wife.

China’s currency and stock markets strengthened on Monday, as investors bet the reopening could help reinvigorate a $17 trillion economy suffering its lowest growth in nearly half a century.

Beijing’s move to drop quarantine requirements for visitors is expected to boost outbound travel, as residents will not face those restrictions when they return.

But flights are scarce and several nations are demanding negative tests from visitors from China, seeking to contain an outbreak that is overwhelming many of China’s hospitals and crematoriums. China, too, requires pre-departure negative COVID tests from travellers.

China’s top health officials and state media have repeatedly said COVID infections are peaking across the country and they are playing down the threat now posed by the disease.

“Life is moving forward again!,” the official newspaper of the Communist Party, the People’s Daily, wrote in an editorial praising the government’s virus policies late on Sunday which it said had moved from “preventing infection” to “preventing severe disease”.

“Today, the virus is weak, we are stronger.”

Officially, China has reported just 5,272 COVID-related deaths as of Jan. 8, one of the lowest rates of death from the infection in the world.

But the World Health Organization has said China is under-reporting the scale of the outbreak and international virus experts estimate more than one million people in the country could die from the disease this year.

Shrugging off those gloomy forecasts, Asian shares climbed to a five-month high on Monday while China’s yuan firmed to its strongest level against the dollar since mid-August.

China’s blue-chip index (.CSI300) gained 0.7%, while the Shanghai Composite Index (.SSEC) rose 0.5% and Hong Kong’s Hang Seng Index (.HSI) climbed 1.6%.

“The ending of the zero-COVID policy is … going to have a major positive impact on domestic spending,” Ralph Hamers, group chief executive officer at UBS, told the Swiss bank’s annual Greater China conference on Monday.

“We believe there is a lot of opportunity for those committed to investing in China.”

‘HUGE RELIEF’

“It’s a huge relief just to be able to go back to normal … just come back to China, get off the plane, get myself a taxi and just go home,” Michael Harrold, 61, a copy editor in Beijing told Reuters at Beijing Capital International Airport on Sunday after he arrived on a flight from Warsaw.

Harrold said he had been anticipating having to quarantine and do several rounds of testing on his return when he left for Europe for a Christmas break in early December.

State broadcaster CCTV reported on Sunday that direct flights from South Korea to China were close to sold out. The report quickly shot to the most-read item on Chinese social media site Weibo.

In the near term, a spike in demand from travellers will be hampered by the limited number of flights to and from China, which are currently at a small fraction of pre-COVID levels.

Flight Master data showed that on Sunday, China had a total of 245 international inbound and outbound flights, compared with 2,546 flights on the same day in 2019 – a fall of 91%.

Korean Air said earlier this month that it was halting a plan to increase flights to China due to Seoul’s cautious stance towards Chinese travellers. South Korea like many other countries now requires travellers from China, Macau and Hong Kong to provide negative COVID test results before departure.

Taiwan, which started testing arrivals from China on Jan. 1, said on Monday that nearly 20% of those tested so far were positive for COVID.

China’s domestic tourism revenue in 2023 is expected to recover to 70-75% of pre-COVID levels, but the number of inbound and outbound trips is forecast to recover to only 30-40% of pre-COVID levels this year, China News reported on Sunday.

Reporting by Yew Lun Tian, Liz Lee, Josh Arslan, Eduardo Baptista and Sophie Yu in Beijing; Ben Blanchard in Taipei; Writing by John Geddie; Editing by Raju Gopalakrishnan

Our Standards: The Thomson Reuters Trust Principles.

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Business

Asia shares up on Fed rate wagers, China reopening lifts yuan

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  • https://tmsnrt.rs/2zpUAr4
  • U.S. share futures edge up, Nikkei futures gain
  • Hopes U.S. CPI report will make case for smaller Fed hikes
  • Earnings season kicks off with major banks on Friday
  • Dollar nurses losses, yuan at highest since mid-August

SYDNEY, Jan 9 (Reuters) – Asian shares rallied on Monday as hopes for less aggressive U.S. rate hikes and the opening of China’s borders bolstered the outlook for the global economy.

MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) rose 2.0% to a five-month top, with South Korean shares (.KS11) gaining 2.2%.

Chinese blue chips (.CSI300) added 0.7%, while Hong Kong shares (.HSI) climbed 1.4%. China’s yuan also firmed to its highest since mid-August under 6.8000.

Japan’s Nikkei (.N225) was closed for a holiday but futures were trading at 26,215, compared with a cash close on Friday of 25,973.

S&P 500 futures added 0.2% and Nasdaq futures 0.3%. EUROSTOXX 50 futures gained 0.6%, while FTSE futures firmed 0.3%.

Earnings season kicks off this week with the major U.S. banks, with the Street fearing no year-on-year growth at all in overall earnings.

“Excluding Energy, S&P 500 EPS (earnings per share) is expected to fall 5%, driven by 134 bp of margin compression,” wrote analysts at Goldman Sachs. “Entering reporting season, earnings revision sentiment is negative relative to history.

“We expect further downward revisions to consensus 2023 EPS forecasts,” they added. “China reopening is one upside risk to 2023 EPS, but margin pressures, taxes, and recession present greater downside risks.”

A sign of the strain came from reports Goldman would start cutting thousands of jobs across the firm from Wednesday, as it prepares for a tough economic environment. read more

In Asia, Beijing has now opened borders that had been all but shut since the start of the COVID-19 pandemic, allowing a surge in traffic across the nation. read more

Bank of America analyst Winnie Wu expects China’s economy, the second-largest economy in the world, to benefit from a cyclical upturn in 2023 and anticipates market upside from both multiple expansion and 10% EPS growth.

FADING THE FED

Sentiment on Wall Street got a boost last week from a benign blend of solid U.S. payroll gains and slower wage growth, combined with a sharp fall in service-sector activity. The market scaled back bets on rate hikes for the Federal Reserve.

Fed fund futures now imply around a 25% chance of a half-point hike in February, down from around 50% a month ago.

That will make investors ultra sensitive to anything Fed Chair Jerome Powell might say at a central bank conference in Stockholm on Tuesday.

It also heightens the importance of U.S. consumer price index (CPI) data on Thursday, which is forecast to show annual inflation slowing to a 15-month low of 6.5% and the core rate dipping to 5.7%.

“We at NatWest have lower than consensus CPI forecasts, and if right that will likely solidify the market pricing of 25bps vs 50bps,” said NatWest Markets analyst John Briggs.

“In context, it should still be seen as a Fed that is still likely to hike a few more times and then hold rates high until inflation’s decline is guaranteed – to us that means a 5-5.25% funds rate.”

Friday’s mixed data had already seen U.S. 10-year yields drop a steep 15 basis points to 3.57%, while dragging the U.S. dollar down across the board.

Early Monday, the euro was holding firm at $1.0673 , having bounced from a low of $1.0482 on Friday. The dollar eased to 131.48 yen , away from last week’s top of 134.78, while its index was flat at 103.600 .

The Brazilian real had yet to trade after hundreds of supporters of far-right former President Jair Bolsonaro were arrested after invading the country’s Congress, presidential palace and Supreme Court. read more

The drop in the dollar and yields was a boon for gold, lifting it to an eight-month peak around $1,877 an ounce .

Oil prices were steadier, after sliding around 8% last week amid demand concerns.

Brent bounced 80 cents to $79.37 a barrel, while U.S. crude rose 78 cents to $74.55 per barrel.

Reporting by Wayne Cole; Editing by Bradley Perrett and Christopher Cushing

Our Standards: The Thomson Reuters Trust Principles.

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World

Travel curbs rack up as COVID-hit China readies reopening

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  • China to drop quarantine for overseas visitors on Sunday
  • Greece joins nations imposing travel curbs on China
  • Travel rush, holidays could inflame virus outbreak

SHANGHAI/BEIJING, Jan 6 (Reuters) – More countries around the world are demanding that visitors from China take COVID tests, days before it drops border controls and ushers in an eagerly awaited return to travel for a population that has been largely stuck at home for three years.

From Sunday, China will end the requirement for inbound travellers to quarantine, the latest dismantling of its “zero-COVID” regime that began last month following historic protests against a suffocating series of mass lockdowns.

But the abrupt changes have exposed many of China’s 1.4 billion population to the virus for the first time, triggering an infection wave that is overwhelming some hospitals, emptying pharmacy shelves of medication and causing international alarm.

Greece, Germany and Sweden on Thursday joined more than a dozen countries to demand COVID tests from Chinese travellers, as the World Health Organisation said China’s official virus data was under-reporting the true extent of its outbreak.

Chinese officials and state media have struck a defiant tone, defending the handling of the outbreak, playing down the severity of the surge and denouncing foreign travel requirements for its residents.

Foreign Ministry spokesperson Mao Ning warned on Friday of possible reciprocal measures after the European Union recommended pre-departure testing for Chinese passengers.

“The EU should listen more to … rational voices and treat China’s epidemic prevention and control objectively and fairly,” Mao told a regular media briefing in Beijing.

The Global Times, a nationalistic tabloid published by the official People’s Daily, said in an editorial that some Western media and politicians “would never be satisfied” no matter what steps China takes.

The global aviation industry, battered by years of pandemic curbs, has also been critical of the decisions to impose testing on travellers from China. China will still require pre-departure testing for inbound travellers after Jan. 8.

HOSPITALS PACKED

Some Chinese citizens think the reopening has been too hasty.

“They should have taken a series of actions before opening up … and at the very least ensure that the pharmacies were well stocked,” a 70-year-old man who gave his surname as Zhao told Reuters in Shanghai.

China reported five new COVID deaths in the mainland for Thursday, bringing its official virus death toll to 5,264, one of the lowest in the world.

But that appeared to be at odds with the reality on the ground where funeral parlours are overwhelmed and hospitals are packed with elderly patients on respirators. In Shanghai, more than 200 taxi drivers are driving ambulances to meet demand for emergency services, the Shanghai Morning Post reported.

International health experts believe Beijing’s narrow definition of COVID deaths does not reflect a true toll that could rise to more than a million fatalities this year.

Investors are optimistic that China’s reopening can eventually reinvigorate a $17-trillion economy suffering its lowest growth in nearly half a century.

Those hopes, alongside policy measures to help revive its troubled property sector, lifted China’s yuan on Friday.

Meanwhile, both China’s blue-chip CSI300 Index (.CSI300) and the Shanghai Composite Index (.SSEC) have gained more than 2% in the first trading week of the year.

“While the re-opening is likely to be a bumpy affair amid surging COVID-19 cases and increasingly stretched health systems, our economists expect growth momentum across Asia to gather steam, led by China,” Herald van der Linde, HSBC’s head of equity strategy, Asia Pacific, said in a note.

SOUTHEAST ASIA OPEN

With the big Lunar New Year holidays late this month, the mainland is also set to open the border with its special administrative region of Hong Kong on Sunday, for the first time in three years.

Ferry services between the city and the gambling hub of Macau will resume on the same day.

Hong Kong’s Cathay Pacific Airways (0293.HK) said on Thursday it would more than double flights to mainland China. Flights to and from China remain at a tiny fraction of pre-COVID levels.

The WHO has warned that the holiday, which starts on Jan. 21 and usually brings the biggest human migration on the planet as people head home from cities to visit families in small towns and villages, could spark another infection wave in the absence of higher vaccination rates and other precautions.

Authorities expect 2.1 billion passenger trips, by road, rail, water and air, over the holiday, double last year’s 1.05 billion journeys during the same period.

The transport ministry has urged people to be cautious to minimise the risk of infection for elderly relatives, pregnant women and infants.

One region poised to be a major beneficiary of China’s opening is Southeast Asia, where countries have not demanded that Chinese visitors take COVID tests.

Except for airline wastewater testing by Malaysia and Thailand for the virus, the region’s 11 nations will treat Chinese travellers like any others.

As many as 76% of Chinese travel agencies ranked Southeast Asia as the top destination when outbound travel resumed, according to a recent survey by trade show ITB China.

Many people in China have taken to social media to announce their travel plans but some remain wary.

“You want to see the world, but the world might not want to see you,” wrote one WeChat user from Tianjin city.

Reporting by Brenda Goh in Shanghai, Bernard Orr, Eduardo Baptista, Martin Pollard and Liz Lee in Beijing, Farah Master in Hong Kong, and Xinghui Kok in Singapore; Writing by John Geddie and Greg Torode; Editing by Robert Birsel and Andrew Heavens

Our Standards: The Thomson Reuters Trust Principles.

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World

China defends its COVID response after WHO, Biden concerns

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  • China says outbreak is controllable
  • WHO says China under-reporting hospital admissions, deaths
  • Official data at odds with packed hospitals, crematoriums
  • Asian shares up on hopes China reopening stimulates growth

BEIJING/SHANGHAI, Jan 5 (Reuters) – China defended on Thursday its handling of its raging COVID-19 outbreak after U.S. President Joe Biden voiced concern and the World Health Organisation (WHO) said Beijing was under-reporting virus deaths.

The WHO’s emergencies director, Mike Ryan, said on Wednesday in some of the U.N. health agency’s most critical remarks to date, that Chinese officials were under-representing data on several fronts.

China scrapped its stringent COVID controls last month after protests against them, abandoning a policy that had shielded its 1.4 billion population from the virus for three years.

China’s foreign ministry spokesperson Mao Ning told a regular press briefing in Beijing that China had transparently and quickly shared COVID data with the WHO.

Mao said that China’s “epidemic situation is controllable” and that it hoped the WHO would “uphold a scientific, objective, and impartial position”.

“Facts have proved that China has always, in accordance with the principles of legality, timeliness, openness and transparency, maintained close communication and shared relevant information and data with the WHO in a timely manner,” Mao said.

China reported one new COVID death in the mainland for Wednesday, compared with five a day earlier, bringing its official death toll to 5,259.

Ryan said on Wednesday the numbers China was publishing under-represented hospital admissions, intensive care unit patients and deaths.

Hours later, U.S. President Joe Biden also raised concern about China’s handling of a COVID outbreak that is filling hospitals and overwhelming some funeral homes.

“They’re very sensitive … when we suggest they haven’t been that forthcoming,” Biden told reporters while on a visit to Kentucky.

The French health minister voiced similar fears while German Health Minister Karl Lauterbach voiced concern about a new COVID subvariant linked to growing hospitalisations in the northeastern United States.

CROWDED HOSPITAL

The United States is one of more than a dozen countries that have imposed restrictions on travellers from China.

China has criticised such border controls as unreasonable and unscientific and the government said on Thursday that its border with its special administrative region of Hong Kong would also reopen on Sunday, for the first time in three years.

Millions of people will be travelling within China later this month for the Lunar New Year holiday.

China’s government has played down the severity of the situation in recent days and the state-run Global Times said in an article on Wednesday that COVID had peaked in several cities including the capital, Beijing, citing interviews with doctors.

But at a hospital in Shanghai’s suburban Qingpu district, patients on beds lined the corridors of the emergency treatment area and main lobby on Thursday, most of them elderly and several breathing with oxygen tanks, a Reuters witness said.

A notice on a board advised that patients would have to wait an average of five hours to be seen.

Staff declared one elderly patient dead and pinned a note to the body on the floor stating the cause of death “respiratory failure”.

Police patrolled outside a nearby crematorium, where a stream of mourners carried wreathes and waited to collect the ashes of loved ones.

DATA GAPS

With one of the lowest official COVID death tolls in the world, China has been routinely accused of under-reporting for political reasons.

In December last year, the WHO said it had received no data from China on new COVID hospitalisations since Beijing lifted its zero-COVID policy.

In its latest weekly report, the WHO said China reported 218,019 new weekly COVID cases as of Jan. 1, adding that gaps in data might be due to authorities simply struggling to tally cases.

The methods for counting COVID deaths have varied across countries since the pandemic first erupted in the central Chinese city of Wuhan in late 2019.

Chinese health officials have said only deaths caused by pneumonia and respiratory failure in patients who had the virus are classified as COVID deaths.

But disease experts outside China have said its approach would miss several other widely recognised types of fatal COVID complications, from blood clots to heart attacks as well as sepsis and kidney failure.

International health experts predict at least 1 million COVID-related deaths in China this year without urgent action. British-based health data firm Airfinity has estimated about 9,000 people in China are probably dying each day from COVID.

Surging COVID infections are hurting demand in China’s $17 trillion economy, with a private-sector survey on Thursday showing services activity shrank in December.

But investors remain optimistic that China’s dismantling of COVID controls will eventually help revive growth that has slid to its lowest rate in nearly half a century. Those hopes were seen lifting Asian equity markets (.MIAPJ0000PUS) on Thursday.

“China reopening has a big impact … worldwide,” said Joanne Goh, an investment strategist at DBS Bank in Singapore, adding the move would spur tourism and consumption and ease supply-chain crunches seen last year.

(This story has been refiled to correct punctuation in headline.)

Reporting by Liz Lee, Eduardo Baptista and Bernard Orr in Beijing, Brenda Goh in Shanghai, Tom Westbrook in Singapore, Steve Holland in Hebron, Kentucky; Writing by John Geddie and Greg Torode; Editing by Robert Birsel

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Business

GM reclaims U.S. auto sales crown from Toyota

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Jan 4 (Reuters) – General Motors Co (GM.N) reclaimed the top spot in U.S. auto sales from rival Toyota Motor Corp (7203.T) in 2022 as it was able to better meet strong demand for cars and trucks despite industry-wide supply disruptions.

Shares of GM rose 2.7% in afternoon trade on Wednesday to $34.75, after the company posted a 2.5% rise in 2022 sales to 2,274,088 vehicles, higher than Toyota’s 2,108,458 units, in a closely watched race.

Inventory shortages stemming from surging material costs and a persistent chip crunch had hobbled production at many automakers, keeping car and truck prices elevated. Asian brands were hit hardest.

“Toyota is still among the tightest when it comes to inventory,” Cox Automotive senior economist Charlie Chesbrough said.

The Japanese automaker cut its full-year production target in November. Sales of its SUVs, a key segment, fell 8.6% in 2022, data on Wednesday showed.

However, Toyota executives said there were some positive signs emerging, and the rate of inventory buildup was slow but steady.

“We’re optimistic our inventory levels will continue to improve in the first quarter and for the remainder of the year,” said Andrew Gillel, senior vice president of automotive operations at Toyota.

Reuters Graphics

Other brands such as Hyundai Motor America, Kia Motors America, Mazda North American Operations and American Honda all posted a drop in sales on Wednesday.

Industry-wide, last year’s U.S. auto sales are forecast to be about 13.9 million units, down 8% from 2021 and 20% from the peak in 2016, according to industry consultant Cox Automotive.

Some analysts are also concerned that price hikes by automakers to blunt inflationary pressures and rising interest rates will take a toll on new vehicle sales in 2023.

Affordability is a “very real issue,” Toyota executive David Christ said. Nonetheless, the company expects demand to be robust this year.

Automakers will need to begin incentivising buyers, a trend that was paused during the pandemic, automotive marketplace TrueCar said.

Reporting by Aishwarya Nair, Nathan Gomes and Abhijith Ganapavaram in Bengaluru; Editing by Shilpi Majumdar and Devika Syamnath

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US

South Korea’s Yoon warns of ending military pact after North drone intrusion

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SEOUL, Jan 4 (Reuters) – South Korean President Yoon Suk-yeol said on Wednesday he would consider suspending a 2018 inter-Korean military pact if the North violates its airspace again, his office said, amid tension over a recent intrusion by North Korean drones.

Yoon made the comment after being briefed on countermeasures to North Korean drones that crossed into the South last week, calling for building an “overwhelming response capability that goes beyond proportional levels,” according to his press secretary, Kim Eun-hye.

“During the meeting, he instructed the national security office to consider suspending the validity of the military agreement if North Korea stages another provocation invading our territory,” Kim told a briefing.

The 2018 deal, sealed on the sidelines of a summit between North Korean leader Kim Jong Un and South Korean President Moon Jae-in, calls for ceasing “all hostile acts”, creating a no-fly zone around the border, and removing landmines and guard posts within the heavily fortified Demilitarised Zone. The government has not said how many mines and posts were removed, citing security concerns.

Abandoning the pact could mean the return of the guard posts, live-fire drills in the former no-fly zone and propaganda broadcasts across the border – all of which drew angry responses from Pyongyang before the pact.

Inter-Korean relations have been testy for decades but have grown even more tense since Yoon took office in May pledging a tougher line against Pyongyang.

During the election campaign last year, Yoon said Pyongyang had repeatedly breached the agreement with missile launches and warned he might scrap it. He said after taking office that the pact’s fate hinges on the North’s actions.

Yoon has criticised the military’s handling of the drone incident, in part blaming the previous administration’s reliance on the 2018 pact.

He has urged the military to stand ready to retaliate, even if that means “risking escalation.”

Yoon ordered the defence minister to launch a comprehensive drone unit that performs multi-purpose missions, including surveillance, reconnaissance and electronic warfare, and to set up a system to mass-produce small drones that are difficult to detect within the year, Kim said.

“He also called for accelerating the development of stealthy drones this year and quickly establishing a drone killer system,” she said.

South Korea’s army operated two drone squadrons within its Ground Operations Command since 2018, but they were primarily designed to prepare for future warfare.

The defence ministry has said it plans to launch another unit focusing on surveillance and reconnaissance functions, especially targeting smaller drones.

“The upcoming unit would carry entirely different tasks, conducting operations in various areas,” Defence Minister Lee Jong-sup told parliament last week.

To boost its anti-drone capability, the ministry announced plans last week it would spend 560 billion won ($440 million) over the next five years on technology such as airborne laser weapons and signal jammers.

($1 = 1,273.9000 won)

Reporting by Hyonhee Shin; Editing by Tom Hogue and Gerry Doyle

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World

China pledges ‘final victory’ over COVID as outbreak raises global alarm

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  • Virus spreading fast in China after policy U-turn
  • Japan latest country requiring tests from China arrivals
  • EU meeting to discuss China travel policy
  • WHO seeking data from Chinese scientists

BEIJING, Jan 4 (Reuters) – Global health officials tried to determine the facts of China’s raging COVID-19 outbreak and how to prevent a further spread as the government’s mouthpiece newspaper on Wednesday rallied citizens for a “final victory” over the virus.

China’s axing of its stringent virus curbs last month has unleashed COVID on a 1.4 billion population that has little natural immunity having been shielded from the virus since it emerged in its Wuhan city three years ago.

Funeral homes have reported a spike in demand for their services, hospitals are packed with patients, and international health experts predict at least one million deaths in China this year.

But officially, China has reported a small number of COVID deaths since the policy U-turn and has played down concerns about a disease that it was previously at pains to eradicate through mass lockdowns even as the rest of the world opened up.

“China and the Chinese people will surely win the final victory against the epidemic,” Chinese Communist Party mouthpiece the People’s Daily said in an editorial, rebutting criticism of its tough anti-virus regime that triggered historic protests late last year.

As it now dismantles those restrictions, China has been particularly critical of decisions by some countries to impose a requirement for a COVID test on its citizens, saying they are unreasonable and lack scientific basis.

Japan became the latest country to mandate pre-departure COVID testing for travellers from China, following similar measures by the United States, Britain, South Korea and others.

Health officials from the 27-member European Union are due to meet on Wednesday to discuss a coordinated response to China travel. Most European Union countries favour pre-departure COVID testing for visitors from China.

China, which has been largely shut off from the world since the pandemic began in late 2019, will stop requiring inbound travellers to quarantine from Jan. 8. But it will still demand that arriving passengers get tested before they begin their journeys.

DOUBT ON DATA

Meanwhile, World Health Organization officials met Chinese scientists on Tuesday amid concern over the accuracy of China’s data on the spread and evolution of its outbreak.

The U.N. agency had invited the scientists to present detailed data on viral sequencing and to share data on hospitalizations, deaths and vaccinations.

The WHO would release information about the talks later, probably at a Wednesday briefing, its spokesperson said. The spokesperson earlier said the agency expected a “detailed discussion” about circulating variants in China, and globally.

Last month, Reuters reported that the WHO had not received data from China on new COVID hospitalisations since Beijing’s policy shift, prompting some health experts to question whether it might be concealing the extent of its outbreak.

China reported five new COVID-19 deaths for Tuesday, compared with three a day earlier, bringing the official death toll to 5,258, very low by global standards.

But the toll is widely believed to be much higher. British-based health data firm Airfinity has said about 9,000 people in China are probably dying each day from COVID.

There were chaotic scenes at Shanghai’s Zhongshan hospital where patients, many of them elderly, jostled for space on Tuesday in packed halls between makeshift beds where people used oxygen ventilators and got intravenous drips.

With COVID disruptions slowing China’s $17 trillion economy to its lowest growth in nearly half a century, investors are now hoping policymakers will intervene to counter the slide.

China’s yuan hovered at a four-month high against the dollar on Wednesday, after its finance minister pledged to step up fiscal expansion this year, days after the central bank said it would implement more policy support for the economy.

BOOKING BOOM

Despite some countries imposing restrictions on Chinese visitors, interest in outbound travel from the world’s most populous country is cranking up, state media reported.

Bookings for international flights from China have risen by 145% year-on-year in recent days, the government-run China Daily newspaper reported, citing data from travel platform Trip.com.

The number of international flights to and from China is still a fraction of pre-COVID levels. The government has said it will increase flights and make it easier for people to travel abroad.

Thailand, a major destination for Chinese tourists, is expecting at least five million Chinese arrivals this year, its tourism authority said on Tuesday.

More than 11 million Chinese tourists visited Thailand in 2019, nearly a third of its total visitors.

But there are already signs that an increase in travel from China could pose problems abroad.

South Korea, which began testing travellers from China for COVID on Monday, said more than a fifth of the test results were positive.

Authorities there were hunting on Wednesday for one Chinese national who tested positive but went missing while awaiting quarantine. The person, who was not identified, could face up to a year in prison or fines of 10 million won ($7,840).

Reporting by Bernard Orr and Liz Lee in Beijing and Brenda Goh in Shanghai, Hyonhee Shin in Seoul and Kantaro Komiya in Tokyo; Writing by John Geddie; Editing by Robert Birsel

Our Standards: The Thomson Reuters Trust Principles.

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Business

South Korea fines Tesla $2.2 mln for exaggerating driving range of EVs

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SEOUL, Jan 3 (Reuters) – South Korea’s antitrust regulator said it would impose a 2.85 billion won ($2.2 million) fine on Tesla Inc (TSLA.O) for failing to tell its customers about the shorter driving range of its electric vehicles (EVs) in low temperatures.

The Korea Fair Trade Commission (KFTC) said that Tesla had exaggerated the “driving ranges of its cars on a single charge, their fuel cost-effectiveness compared to gasoline vehicles as well as the performance of its Superchargers” on its official local website since August 2019 until recently.

The driving range of the U.S. EV manufacturer’s cars plunge in cold weather by up to 50.5% versus how they are advertised online, the KFTC said in a statement on Tuesday.

Tesla could not be immediately reached for comment.

On its website, Tesla provides winter driving tips, such as pre-conditioning vehicles with external power sources, and using its updated Energy app to monitor energy consumption, but does not mention the loss of driving range in sub-zero temperatures.

[1/2] A view shows the Tesla logo on the hood of a car in Oslo, Norway November 10, 2022. REUTERS/Victoria Klesty

In 2021, Citizens United for Consumer Sovereignty, a South Korean consumer group, said the driving range of most EVs drop by up to 40% in cold temperatures when batteries need to be heated, with Tesla suffering the most, citing data from the country’s environment ministry.

Last year, the KFTC fined German carmaker Mercedes-Benz and its Korean unit 20.2 billion won for false advertising tied to gas emissions of its diesel passenger vehicles.

The challenge for electric vehicle performance in extreme temperatures is widely known, though EVs are popular in markets like Norway, where four out of five vehicles sold last year were battery-powered, led by Tesla.

A 2020 study of 4,200 connected EVs of all makes by Canada-based telematics provider Geotab found that most models had a similar drop in range in cold weather, primarily because the battery is also used to heat the car for the driver and passengers.

At just above 20 degrees Celsius, the average EV outperformed its stated range, but at minus 15 degrees the average EV had only 54% of its rated range, the study found.

Reporting by Ju-min Park and Hyunsu Yim; Editing by Himani Sarkar and Emelia Sithole-Matarise

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World

Yoon says South Korea, U.S. discussing exercises using nuclear assets

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SEOUL, Jan 2 (Reuters) – South Korea and the United States are discussing possible joint planning and exercises using U.S. nuclear assets in the face of North Korea’s growing nuclear and missile threats, South Korean President Yoon Suk-yeol said in a newspaper interview.

The Chosun Ilbo newspaper quoted Yoon as saying the joint planning and exercises would be aimed at a more effective implementation of the U.S. “extended deterrence.”

The term means the ability of the U.S. military, particularly its nuclear forces, to deter attacks on U.S. allies.

“The nuclear weapons belong to the United States, but planning, information sharing, exercises and training should be jointly conducted by South Korea and the United States,” Yoon said, adding Washington is also “quite positive” about the idea.

Yoon’s remarks come a day after North Korean state media reported that its leader Kim Jong Un called for developing new intercontinental ballistic missiles (ICBMs) and an “exponential increase” of the country’s nuclear arsenal to counter U.S.-led threats amid flaring tension between the rival Koreas.

The North’s race to advance its nuclear and missile programmes has renewed debate over South Korea’s own nuclear armaments, but Yoon said maintaining the Treaty on the Non-Proliferation of Nuclear Weapons remained important.

At a meeting of the ruling Workers’ Party last week, Kim said South Korea has now become the North’s “undoubted enemy” and rolled out new military goals, hinting at another year of intensive weapons tests and tension.

Inter-Korean ties have long been testy but have been even more frayed since Yoon took office in May.

On Sunday, North Korea fired a short-range ballistic missile off its east coast, in a rare late-night, New Year’s Day weapons test, following three ballistic missiles launched on Saturday, capping a year marked by a record number of missile tests.

Yoon’s comments on the nuclear exercises are the latest demonstration of his tough stance on North Korea. He urged the military to prepare for a war with “overwhelming” capability following North Korean drones crossing into the South last week.

Analysts say the tensions could worsen.

“This year could be a year of crisis with military tension on the Korean peninsula going beyond what it was like in 2017,” said Hong Min, a senior researcher at the Korea Institute for National Unification, referring to the days of the “fire and fury” under the Trump administration.

“North Korea’s hardline stance…and aggressive weapons development when met with South Korea-U.S. joint exercises and proportional response could raise the tension in a flash, and we cannot rule out what’s similar to a regional conflict when the two sides have a misunderstanding of the situation,” Hong said.

Reporting by Soo-hyang Choi, Editing by Raju Gopalakrishnan

Our Standards: The Thomson Reuters Trust Principles.

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World

Wall St stocks fall, oil rises as China drops quarantine rule

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NEW YORK/LONDON, Dec 27 (Reuters) – Wall Street’s benchmark S&P 500 and the Nasdaq fell on Tuesday after the release of U.S. economic data, while oil prices rose after China said it would scrap its COVID-19 quarantine rule for inbound travellers, which was seen as a major step in reopening its borders.

U.S. Treasury yields rose after economic data that showed the advance goods trade deficit for November narrowed to $83.35 billion from the prior month’s $98.8 billion, while a separate report pointed to continued struggles for the housing market as home prices fell under rising mortgage rates.

Oil pared gains as some U.S. energy facilities shut by winter storms began to restart after the commodity earlier hit a three-week high as China’s latest easing of COVID-19 restrictions spurred hopes of a recovery in demand.

On the first day of the holiday-shortened trading week, the rise in U.S. rates put pressure on shares in the heavy-weight rate sensitive technology sector, according to Michael O’Rourke, chief market strategist at JonesTrading in Stamford, Connecticut.

“It’s a lack of anybody with the conviction to step in and buy right now,” said O’Rourke, who said further pressure came from a sharp decline in shares of electric car maker Tesla Inc (TSLA.O).

The Dow Jones Industrial Average (.DJI) rose 113.48 points, or 0.34%, to 33,317.41, the S&P 500 (.SPX) lost 5.67 points, or 0.15%, to 3,839.15 and the Nasdaq Composite (.IXIC) dropped 90.23 points, or 0.86%, to 10,407.64.

Markets in some regions including London, Dublin, Hong Kong and Australia remained shut after the Christmas holiday.

The pan-European STOXX 600 index (.STOXX) rose 0.19% and MSCI’s gauge of stocks across the globe (.MIWD00000PUS) gained 0.03%.

Emerging market stocks (.MSCIEF) rose 0.27%. MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) closed 0.53% higher, while Japan’s Nikkei (.N225) rose 0.16%.

Benchmark 10-year notes were up 7.5 basis points at 3.822%, from 3.747% on Friday. The 30-year bond was last up 9 basis points to yield 3.9116%, from 3.822%. The 2-year note was last up 6.4 basis points to yield 4.387%, from 4.323%.

The dollar pared losses on Tuesday after China said it would scrap its COVID-19 quarantine rule for inbound travellers, which also boosted risk-related currencies such as the Australian dollar.

The dollar index , which measures the greenback against a basket of major currencies, was down 0.01%, with the euro up 0.14% at $1.065.

The Japanese yen weakened 0.37% versus the greenback at 133.36 per dollar, while Sterling was last trading at $1.2019, down 0.34% on the day.

Commodity currencies such as the New Zealand and Australian dollars also moved higher. read more

In energy futures, U.S. crude recently rose 0.98% to $80.34 per barrel and Brent was at $84.81, up 1.06% on the day.

Gold prices rose as optimism surrounding decisions by top consumer China to ease COVID-19 restrictions weighed on the dollar, while resilient U.S. yields cast a shadow over non-yielding bullion’s advance.

Spot gold added 1.5% to $1,824.29 an ounce. U.S. gold futures gained 1.09% to $1,815.50 an ounce.

Reporting by Sinéad Carew in New York, Nell Mackenzie in London
Additional reporting by Xie Yu and Ankur Banerjee
Editing by Simon Cameron-Moore and Matthew Lewis

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