Jiangyin, an aspiring tech hub known as one of China's most economically vibrant towns, has been grappling with a strict lockdown for the past two weeks as total Covid-19 cases climbed past 450 since early May, reflecting the mounting challenges for Beijing's effort to keep the Omicron variant at bay while maintaining a certain level of economic activity.

The 1.7 million residents of the Wuxi-administered county-level city in eastern Jiangsu province have been under travel restrictions since May 4. They have been told "not to leave home unless necessary and not to leave Jiangyin unless necessary". A separate notice this week said traffic in the city is restricted to essential companies and workers, which must apply for special gate passes.

Jiangyin, which covers an area slightly smaller than Hong Kong, accounts for over 90 per cent of Covid-19 cases in Jiangsu, China's second largest provincial economy. This has put huge pressure on local authorities to prevent the outbreak from spreading further.

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"We need to be faster than the spread of the virus and stamp out the outbreak in Jiangyin," Wu Zhenglong, Jiangsu's newly elected Communist Party secretary, said on Tuesday.

Since the lockdown began, most economic activity had ground to a halt in Jiangyin, which has an economy the size of some provinces and has become an icon of China's manufacturing capabilities. It is home to 58 listed companies, the most of any Chinese county, such as solar module manufacturer Jiangsu Akcome Science & Technology, fashion group HLA and Xingcheng Special Steel. A Beijing-based think tank ranked Jiangyin as the most competitive county in China last year.

Under a nationwide "dynamic zero" approach to containing the virus, Jiangyin has resorted to draconian social controls.

Local residents in the city said they are relying on "special gate passes" with dedicated purposes to conduct daily activities. A staff member at a local financial regulator said she uses one pass to leave the compound to buy supplies once every three days and another to go to work. Another worker at a state-owned enterprise said her colleagues that handle fieldwork have been granted essential worker passes. Both workers, who live in the city's "control zones" that allow for limited movement, declined to be named.

Daily mass testing is now the norm in these control zones, which is the default in most parts of the city. Meanwhile, residents in "lockdown zones" remain stuck at home and rely on food provided by the government.

Volunteers in Jiangyin deliver government supplies amid a strict lockdown preventing many people from leaving their homes. Photo: Weixin alt=Volunteers in Jiangyin deliver government supplies amid a strict lockdown preventing many people from leaving their homes. Photo: Weixin>

Few businesses are willing to estimate the costs of lockdown measures, as China's top leadership has declared its approach to containing Covid-19 as the right choice for the country. In a recent speech, President Xi Jinping pledged to fight attempts to "distort, question and challenge" national Covid policies.

HLA Group, the fashion franchise based in Jiangyin, told the South China Morning Post that the lockdown measures have "generated a certain impact on the operations of the company", but it did not disclose any details.

The economic disruptions in Jiangyin, which could return to normal within days if Covid-19 is brought under control, have become a typical occurrence in many pockets of the world's second largest economy. China's dynamic zero approach can quickly lead to citywide lockdowns as soon as any new cases are confirmed, while key producers receive certain favourable treatment to help them resume production under a "closed-loop" system that keeps employees living and working within a company's compound.

The shocks to supply chains have been unprecedented.

In Jiangyin, which is closely related with neighbouring towns through a web of highways and waterways, the local outbreak is having a spillover effect.

One sports-related goods manufacturer that has operations in both Jiangyin and Suzhou-administered Zhangjiagang has temporarily closed its Jiangyin factory, according to a worker at the Zhangjiagang office, who asked only to be identified by her surname Zhou. People at her office now work just two or three days per week, she said.

The Jiangyin lockdown has made operations very difficult for the company, according to Zhou. "We used to have local workers here who live in Jiangyin," she said. "Now they cannot physically pass the border."

With no signs of when lockdown measures will ease, Jiangyin serves as another example of how Beijing's dynamic zero policy has turned an integrated economy into a hodgepodge of fragmented, beggar-thy-neighbour regimes under lockdown.

Beyond just Jiangyin and Zhangjiagang, an intensive flow of people has been critical to the neighbouring economic hubs of Wuxi and Suzhou. However, the two economies have been hit hard by their "3+11" quarantine policy, which lasted about two months before it was lifted last Tuesday. This required residents travelling between the two cities to quarantine at home for three days when they reach their destination, followed by 11 days of self-monitoring.

Despite the official policy coming to an end, implementation is left up to individual compounds, Zhou said.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2022. South China Morning Post Publishers Ltd. All rights reserved.