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Shanghai looks for a COVID cluster in karaoke as China tries to stop new outbreaks.

(Reuters) – SHANGHAI/BEIJINGOn Thursday, millions of people in Shanghai lined up for a third day of mass COVID-19 testing, as officials in several Chinese cities rushed to stop new outbreaks that have raised concerns about the growth of the world’s second-largest economy.

Local government officials in all parts of China were put under a lot of pressure to stop the disease from spreading to the point where the country’s “dynamic zero COVID” strategy would have to be put into place. This would mean a lot of restrictions for a long time.

Shanghai, in particular, didn’t want to go through another two-month lockdown like the ones that happened in April and May, which cost the city’s 25 million people a lot of money and made them feel stressed out. It also messed up global supply chains and international trade.

“A resurgence of Omicron is not a problem in most other countries, but it is still the biggest problem for the Chinese economy,” analysts at Nomura wrote in a note, referring to the COVID variant that is very easy to spread.

Since China is “by far the largest manufacturing centre in the world,” any new waves of Omicron are likely to have a “not-negligible impact,” they said.

This week, the latest events in China have hurt the prices of assets around the world.

Shanghai, China’s most populated city, is working quickly to find and isolate infections that may have come from a building where a karaoke lounge reopened without a licence and karaoke services were offered without a licence.

The city government said Wednesday that the two businesses have been fined and had their licences taken away. It said that two local officials were being looked into for not doing their jobs properly.

From Tuesday to Thursday, people in many of Shanghai’s 16 districts had to take two tests. But if people want to go to shopping malls or take public transportation, they have to take tests on their own a lot.

On Wednesday, there were 54 new COVID cases that were spread locally in Shanghai, up from 24 the day before.

On Thursday, another 50 compounds and places were locked down in the business hub, bringing the total to 81.

Outbreaks as a game of “Whack-a-Mole” “

Overall, mainland China reported 338 new local COVID cases on Wednesday, which is less than the previous day’s number of 353, and there were no new deaths. This is a number that most countries would now consider unimportant.

Most of the cases, 167, were in the eastern province of Anhui, where more than 1 million people are locked down in small towns.

The number of new infections in Beijing dropped from six to four.

As of July 11, most people who want to go to crowded places like libraries, theatres, and gyms will have to get a COVID shot for the first time. This rule went into effect in the capital on Wednesday.

After finding one case coming from Shanghai, the town of Xinjiang in the northern province of Shanxi has tested almost all of its 280,000 residents, stopped taxi, ride-hailing, and bus services, and shut down a number of entertainment venues.

In a different province, Shaanxi, where 4 new cases were reported, the cultural and tourism authority asked travel agencies to cancel any group tours to the famous Terracotta Army-themed parts of the capital city, Xian.

The eastern province of Jiangsu has reported 61 cases, and a big sports event that was supposed to happen in November has been cancelled.

China has said that its strict COVID policy, which goes against the global trend of living with the virus, saves lives and is worth the “temporary” economic costs.

Officials have pointed out that COVID has been linked to millions of deaths around the world, but only 5,226 deaths have been reported in China.

Analysts warn, though, that some costs may be permanent if China’s debt load grows and if restrictions make investors and talented people think twice about staying in the country.

Two people who know about the matter told Reuters that China wants to set up a 500 billion yuan ($75 billion) state infrastructure fund to help get the economy going again.

($1 is equal to 6.70 Chinese yuan)

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