OECD secretary-general Mathias Cormann said on Monday that China’s reopening was “definitely positive” in the global fight against rising inflation.
“We’re actually more than happy with the easing of Covid restrictions in China,” said Cormann Joumanna Bercetche of CNBC at the World Economic Forum in Davos, Switzerland.
“This shall be difficult in the short term and we’re seeing elevated levels of infection which are more likely to have short term impacts,” he added.
“Nevertheless, in the medium to long run, it is very positive in terms of ensuring that offer chains operate more efficiently and effectively, ensuring that demand in China and trade on the whole resumes in a more positive way. “
China abruptly ended most Covid controls in early December, resulting in a spike in infections amongst its 1.4 billion population.
Beijing said Saturday that almost 60,000 individuals with Covid have died in hospitals since the country lifted strict Covid restrictions last month, a pointy increase from previous figures.
China’s reopening, together with a flurry of positive data surprises, has been cited by economists in recent weeks as a reason to update their previously gloomy forecasts.
“One of the aspects driving inflation was the supply shock of global supply failing to maintain up with global demand… as fast as required,” Cormann said.
“So China’s return to the global market is in earnest, and provide chains that function more efficiently will help bring inflation down. In fact, that is overwhelmingly positive.”