Mark Mobius: China will probably give some relief in its strict covid Zero policy by the end of this year. Its economy is in trouble and the government is in dire need of money. Mark Mobius, one of the world’s leading emerging market investors, said this during a conversation with Bloomberg.
Now covid no problem
Mobius, in response to some Bloomberg News queries, said, “I don’t think Covid is a problem going forward now. China has no option but to open it to make the functioning of the economy smooth. Services will be started for show, but the reality on the ground will be different.”
The cofounder of Mobius Capital Partners predicted that even if President Xi Jinping defended his policy in his address to the Communist Party Congress this month, he may backtrack.
Signs found to end strict policy in Congress
Earlier this week, Anthony Wong, lead manager of the $1.2 billion All China Equity Fund, said China would open up gradually and is expected to happen within six months.”
The recently concluded Congress should signal when officials will end a policy that is stifling Chinese development and disrupting global supply chains.
China economy came under pressure due to lockdown
The world second largest economy has come under a lot of pressure after the lock-down was imposed in the mega city with a population of 20 million.
Economists are now projecting only 3.3% growth for 2022, which is much lower than the earlier target of 5.5%.