Amid tussle between US and China, what price, zero infection? | Opinion - Market News
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Amid tussle between US and China, what price, zero infection? | Opinion

Amid tussle between US and China, what price, zero infection?  |  Opinion

The US and China are engaged in a war of words – again — on the ‘circuit breaker’ measures imposed by the latter on several US airlines.

The measures, which typically involve suspending flights for a period of time, come as many countries battle a sudden surge in coronavirus infections caused by the more contagious Omicron variant.

China first announced ‘circuit breaker’ measures in the early days of the pandemic, as part of efforts to protect the country from an influx of coronavirus cases.

Last April, it amended the scheme: airlines found to carry five or fewer passengers who test positive can now choose between two types of restrictions: based on frequency or based on load factor.

Then, in August, the CAAC imposed load factor sanctions on United Airlines after five passengers tested positive for the coronavirus. More than a week later, Washington imposed similar capacity limits for Chinese airlines flying to the US.

Checks on the CAAC’s website show that the regulator made at least six announcements about flight-suspension measures in the first two weeks of January alone.

Where previous notifications have been scarce and detailed suspensions have only been available for a small handful of carriers, lately not only the frequency but also the length of ‘circuit breaker’ notifications has increased. As a result, the number of international flights to and from the country – which is already severely restricted – has declined even further.

Things came to a head days ago, when the US Department of Transportation threatened retaliation against the CAAC for a series of flight suspensions imposed on airlines, including US carriers.

It said the move was “inconsistent with obligations under the US-China Air Transport Agreement”.

China’s flight-suspension rules still work according to their original intent, as the spread of Omicron is rapidly spreading around the world?

For now, China has defended its strict zero-Covid policy – ​​even doubling it – and stated through state media that countries should prioritize prevention “in the face of… of a pandemic”.

This is despite the fact that the Omicron variant threatens to turn China’s strict pandemic management regulations upside down.

It must be asked: How sustainable is China’s zero-infection stance, especially as countries around it open up and the country enters its third year of closing its borders. The CAAC has already indicated that international borders will probably not open again until 2023.

That means almost four years of almost non-existent international traffic, for both Chinese and international carriers.

For Chinese airlines, which have been consistently losing money since the start of the pandemic, four years could be too long.

While domestic traffic can help support revenues, the past two years have shown that this is not enough.

In addition, airlines around the world, which may have depended on the Chinese travel market as a major revenue stream, are already beginning to look elsewhere and tap into markets that were previously unserved.

Indeed, if China doubles down on zero-infection rhetoric, it risks further isolating itself — and its airlines — on the global stage. Perhaps a more poignant question — and one that airlines may find difficult to ask — is whether the sacrifice is worth it.