The IMF urged China to accelerate its COVID-19 vaccination program, warning that the sharply slowing pace of new doses administered could undermine a recovery in domestic consumer spending.
At the current pace, providing three doses of COVID-19 vaccines to the population would take a “matter of years,” Helge Berger, head of the IMF’s China mission, said in an interview.
With spending growth yet to recover to pre-pandemic rates, partly because households are cautious about COVID-19 infections, “an acceleration of the vaccination campaign would support confidence and ultimately consumption,” he said.
Photo: AP
About 375 million people over the age of 15 in China have yet to receive three doses of a vaccine, while the daily vaccination rate has fallen below 800,000 per day, official data show.
Studies have shown that three doses of China’s domestic COVID-19 vaccines were nearly as effective as mRNA vaccines in preventing severe infections or deaths.
The low rate of full vaccination, particularly among elderly people, is one of the reasons China is persisting with its strict “zero COVID” policy requiring limits on activity wherever virus cases occur.
Only about 64 percent of Chinese people over 60 have received three doses, the Chinese National Health Commission said.
Berger said the lockdowns in Shanghai and dozens of other cities since March are a key reason the IMF sees “downside risks” to its April forecast of 4.4 percent GDP growth for China this year.
“The second quarter will be weak given the lockdowns,” he said.
While national data have largely returned to pre-lockdown levels, Berger added that in Shanghai, measures of economic activity monitored by the IMF have recovered only to about 50 percent.
Economists surveyed by Bloomberg predict growth of 4.1 percent in China this year and a possible contraction in quarter-on-quarter GDP in the April-June period. That makes it unlikely the government would meet its full-year target of about 5.5 percent.
The IMF has consistently called on Beijing to increase fiscal support to households. Even taking into account measures announced since April, China’s fiscal stimulus this year is smaller relative to 2020, Berger added.
“The known fiscal measures this year are still small relative to 2020, even taking into account that in 2020 the overall shock was larger than this year,” he said.
The Investment Commission yesterday approved a Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) application to invest an additional US$3.5 billion in its Arizona subsidiary to manufactured advanced chips. The world’s largest contract chipmaker’s board of directors last month approved the funding project after TSMC started moving manufacturing equipment into the fab in December last year in preparation for the production of 4-nanometer chips next year. TSMC said it has also commenced the second phase of facility construction in Arizona. The second fab is to produce semiconductors using 3-nanometer technology in 2026. Altogether, TSMC plans to spend US$40 billion on the Arizona fabs, doubling its
KEY SECTOR: Taiwan’s new chip legislation is insufficient, and a more strategic ‘chip act’ that covers the whole semiconductor ecosystem is needed, MediaTek’s chairman said MediaTek Inc (聯發科) chairman Rick Tsai (蔡明介) yesterday urged the government to formulate a state semiconductor strategy and comprehensive “chip act” that includes local chip designers and smaller-scale semiconductor companies, as they are facing intensifying competition from China. The government is playing an increasingly important role in safeguarding the local semiconductor industry’s competitiveness, given that the US, the EU and Japan are offering hefty subsidies and significant tax incentives to build semiconductor capacity domestically, as they have realized the strategic importance of semiconductors, Tsai said. To implement such a program, the government should take steps to finance a “chip act,” Tsai said
Microsoft Corp has threatened to cut off access to its Internet search data, which it licenses to rival search engines, if they do not stop using it as the basis for their own artificial intelligence (AI) chat products, people familiar with the dispute have said. The software maker licenses the data in its Bing search index — a map of the Internet that can be quickly scanned in real time — to other companies that offer Web search, such as Apollo Global Management Inc’s Yahoo and DuckDuckGo. Last month, Microsoft integrated a cousin of ChatGPT, OpenAI’s AI-powered chat technology, into Bing. Rivals
MOUNTING PRESSURE: Although bank failures in the US and Europe would not cause systemic risks, it would dampen consumers’ willingness to spend, GlobalWafers said GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said that the financial turmoil in the US and Europe has dimmed the outlook for chip demand in the second half of this year, as growing economic uncertainty could dampen consumer spending. The Hsinchu-based wafer manufacturer said it is seeing greater pressure from economic uncertainty on the industry’s recovery, as customers would have not expected Silicon Valley Bank, Signature Bank and a tier-one bank like Credit Suisse Group SA to collapse suddenly. Although the failures are unlikely to cause systemic risks, consumers would be cautious of spending on non-essential items, such
RSS