The Perfect Enemy | China to spend US$24 billion on Covid-19 control in pivot to living with virus - South China Morning Post
February 24, 2024

China to spend US$24 billion on Covid-19 control in pivot to living with virus – South China Morning Post

China to spend US$24 billion on Covid-19 control in pivot to living with virus  South China Morning Post

The funding will guarantee subsidies for ad hoc payments to medical workers and vaccination expenses, and extend existing subventions for treating Covid-19 patients.

It will also be used to cover personal burdens on Covid-19 hospitalisation bills beyond that assured by public health and major disease insurances, as well as medical aid schemes.

“[The funding] will support the steady and orderly implementation of the policy of managing Covid-19 with measures against Class B infectious diseases,” the ministry’s budget report said, referring to China’s change in response in January – from a strict “zero-Covid” policy to living with the virus.

On January 8, China downgraded its Covid-19 management from category A to category B – which involves only “necessary treatment and measures to curb the spread”.

The proposed Covid-related funding, the first to be revealed since the pandemic hit three years ago, comes weeks after several local governments reported huge Covid-control bills over the past year.

Reports from 22 provinces and cities showed they had spent over 420 billion yuan on zero-Covid measures, including mass testing, quarantine, contact tracing and vaccination drives.

China's slow road to economic recovery after dropping its zero-Covid policies

04:43

China’s slow road to economic recovery after dropping its zero-Covid policies

In delivering his final work report as premier on Sunday morning, Li Keqiang said the Covid-19 pandemic had been among multiple domestic and international factors “beyond our expectations” that had dragged on China’s economy last year.

Prevention and control would continue, just in a more scientific and targeted way, Li said. The priority would be early detection and prevention of severe cases, especially among the elderly, children and those with underlying illnesses.

“Covid-19 vaccines should be upgraded and new drugs should be developed,” Li said. “We should ensure public access to medicines and medical services to protect their lives and health.”

The annual budget report also revealed how Covid-19 prevention and treatment had imposed a heavy burden on fiscal revenues and expenditure.

“In the past year, public finance work faced multiple challenges and fiscal operations remained tight, posing great difficulties,” the report said.

It also made note of stronger government funding guarantees last year for pandemic prevention and control, including a 30 per cent subsidy for vaccination and related fees covered by medical insurance funds, as well as daily payments of 200 yuan for eligible frontline medical workers and 300 yuan for epidemic prevention workers.

Spending by border towns and customs on Covid-19 had also been “guaranteed”, it added.

Budget reports in the past two years included data on public service expenditure, which had exceeded the planned amount by 0.8 per cent in 2020 and 7 per cent in 2021, with the increase in both cases attributed to “pandemic prevention and controls at customs [checkpoints]”.

Such a declaration was missing from this year’s report.

The financial strain caused by Covid-19 control bills was more clearly reflected in local government budget reports, some of which revealed such figures for the first time.

The southern manufacturing hub of Guangdong said it spent 71 billion yuan (US$10.4 billion) last year on Covid-19 containment, covering vaccination, PCR tests, subsidies to health workers, corporate subventions and assistance to other provinces.

The figure was 43.4 billion yuan for eastern Zhejiang province and 30 billion yuan for national capital Beijing, Chinese financial newspaper Caixin reported.

Even the impoverished northwestern province of Shaanxi ran up a bill of 19 billion yuan.