Seven times since last March, Ruili—on China’s Myanmar border—has felt the full force of Xi Jinping’s Covid Zero policy. 3:26 PM IST, 25 Sep 2022
3:26 PM IST, 25 Sep 2022
3:26 PM IST, 25 Sep 2022
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Buyers and seller go through a facial recognition checkpoint at the entrance of the Delong Jewellery Industry Park ahead of the opening of its night market in Ruili, China, on Thursday, August 11, 2022. Photographer: Qilai Shen for Bloomberg Businessweek
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(Bloomberg Businessweek) -- China’s 1,300-mile border with Myanmar traverses some of the most rugged landscapes in Asia. Mountains rise as high as 19,000 feet above sea level, fast-running rivers flow between steep cliffs, and dense forests shelter giant hornbills, snub-nosed monkeys, and elephants. The region has never been an economic development priority for either country, and it has few roads and even fewer large settlements. Ru...
(Bloomberg Businessweek) -- China’s 1,300-mile border with Myanmar traverses some of the most rugged landscapes in Asia. Mountains rise as high as 19,000 feet above sea level, fast-running rivers flow between steep cliffs, and dense forests shelter giant hornbills, snub-nosed monkeys, and elephants. The region has never been an economic development priority for either country, and it has few roads and even fewer large settlements. Ruili, a   Chinese city of a little more than a quarter-million people located on one of the only areas of flat land, is the exception. The city hugs the border, which divides it from Muse, a smaller city on the Myanmar side. Together they constitute a binational urban area—an analog to El Paso and Juárez on the US-Mexico boundary—and a crucial node for commerce. For decades, throngs of people crossed every day: Burmese workers looking for factory jobs, Chinese residents visiting relatives, and traders of both nationalities carrying a huge range of goods, some legal, some not. That traffic has come to an almost complete halt. One of the key planks of   China’s Covid Zero policy, which views even a single infection as an unacceptable risk, is the closure of the country’s borders, sealing it off from a world that has overwhelmingly decided to live with the coronavirus. Nowhere is the impact of the strategy more obvious than in Ruili. With the pandemic going largely unchecked in Myanmar, last year local officials began putting up spans of sheet metal, barracks for guards, and fences topped with razor wire along the boundary with Muse—structures the mayor dubbed a “Steel Great Wall.” When the local government discovered infections, it imposed some of the harshest restrictions in China. Ruili residents endured seven separate lockdowns from March 2021 to April 2022 and spent a total of 119 days barred from leaving their homes. Mandatory testing has been so frequent that, according to one Chinese news site, a baby there was swabbed six dozen times by his first birthday. Like most Chinese cities, Ruili (pronounced “ray-lee”) has officially recorded precious   few deaths from Covid-19. Stamping out the virus has been a genuine public-health achievement, but it has come at a   major economic and social cost. When  visited recently, boarded-up storefronts lined many streets, idle construction sites baked in the subtropical sun, and jade markets, the city’s best-known tourist attraction, had far more merchants than customers. Local economic output contracted 15% in 2021. And after six months with no recorded cases, which allowed the authorities to relax most day-to-day restrictions, parts of Ruili went back into lockdown in mid-September in response to an infection in a quarantine center. There’s been no indication of when—or if—the border will reopen. The Steel Great Wall may well be permanent. Although Ruili’s pandemic policies have been extreme, they’ve been in line with China’s overall posture. Every other nation that took a zero-tolerance approach to the coronavirus, including   Australia and   Singapore, has removed restrictions and reopened to the world. But in China, President  Xi Jinping, who’s expected to have his leadership extended by at least five years at the Communist Party congress in October, frequently trumpets his country’s minuscule death toll—only 5,200 fatalities counted so far—as evidence of its political system’s superiority. He’s said repeatedly that he has  no intention of abandoning Covid Zero, even as it has hammered domestic consumption and snarled international supply chains, threatening global growth. Barring a change of heart or an end to the pandemic, that means the 1.4 billion people Xi rules will have to adapt to indefinite constraints on trade and travel, and to be prepared for further lockdowns. Already, severe restrictions on movement are becoming commonplace, with recent lockdowns targeting Shanghai, Shenzhen, and Chengdu, among dozens of other cities. Listen to this story. Amy Gadsden, associate vice provost for global initiatives at the University of Pennsylvania and a former special adviser on China to the US Department of State, says the moves in places like Ruili reflect a long history of local party officials striving to be exemplars of policy implementation, regardless of the efficacy and costs of their actions. “The pandemic has crystallized and resurrected patterns of political and social engagement that have deep roots in Communist China,” she says. Covid Zero “has offered a stark reminder of the party state’s ability to intervene in citizens’ lives in absolute and even cruel ways.”
In the rural areas around Ruili, the border between China and Myanmar zigzags alongside rice and sugar cane fields. It was once informal enough that locals—many of them members of the Dai and Jingpo minorities, Indigenous groups whose ancestral territory spans both sides—crossed easily and undetected along so-called paths of convenience. The border’s fluidity still shapes life in Ruili today. In 2018, the most recent year for which data is available, some 50,000 Myanmar citizens were officially registered to live in the city, though this was almost certainly an undercount. Chinese authorities have never condoned illegal crossings, but nor have they done much to stop them, likely in part because many businesses in Ruili depend on cheap Burmese labor. The border’s fluidity also shaped the pandemic’s course in Ruili. On a cloudy morning in September 2020, a woman identified in government releases only by her surname, Yang, set off from Muse with her three children and two nannies to visit her sister in Ruili. Although the national border had been closed to travelers since the end of March, Yang was able to easily cross the city’s namesake Ruili River, entering China. A few days after arriving, she found she’d lost her sense of taste and smell. Eventually Yang’s sister took her to a hospital, where she was found to have Covid. It was the first time officials had identified someone who’d tested positive after crossing illegally into China from Myanmar. Chinese officials were at the time taking considerable pride in having contained Covid after the initial outbreak in Wuhan. As official propaganda pointed out ceaselessly, they’d protected their population while Europe and the US recorded deaths in the hundreds of thousands. After Yang tested positive, the Ruili government swung into emergency mode. Officials set up checkpoints around the city, barring anyone from leaving or entering. All residents of its central districts were ordered to stay home while the entire population was tested. The testing campaign turned up only a single other infected person—one of the nannies traveling with Yang—and the lockdown was lifted. In the aftermath of the Yang case, Ruili authorities built a fence along the stretch of border that was in their jurisdiction, but they emphasized that it was a temporary structure, to be removed once the situation was determined to be safe. They also allowed the primary checkpoint for goods coming from Myanmar to stay open, maintaining supplies of lumber, jade, and farm produce that are important to the regional economy. Ruili reported its next Covid case six months later, in late March 2021. Like Yang, the infected person was a citizen of Myanmar. (It isn’t clear whether the individual, who wasn’t identified, had crossed into China legally). In Beijing the central government viewed the case as a failure by local officials to police the border—one that put the entire country’s pandemic strategy at risk. Ruili’s Communist Party chief, a well-regarded young official named Gong Yunzun, was fired and then named and shamed on national television, serving as a warning to administrators all over China about the consequences of allowing infections. Gong’s replacement, Zhai Yulong, increased virus-control spending sixfold, bringing it up to 2.12 billion yuan ($303 million) for all of 2021. In the 12 months through April 2022, the city imposed six more lockdowns, at least four of them linked to cases among Burmese nationals. Businesses such as electronics stores and car repair shops remained shut for a year, along with schools, while all shipments from Myanmar were halted and orders were given to build the border wall. Thousands of guards now patrol the structure, and heat-sensing cameras monitor it; inside Ruili, the city set up a system that tracks the movements of all residents and visitors, partly by using facial recognition cameras at the entrances of venues where crowds might gather. It remains in use. When  reporters visited Ruili in early August, local government staff insisted on accompanying them almost everywhere, an indication of how politically sensitive its Covid policies have become. They were present during most of the interviews conducted for this article, and though they didn’t interfere, it’s hard to know how their presence might have affected what people said. At the Daxing Supermarket, one of the city’s largest grocers, manager Qiu Meizhi said she’d kept coming in to work throughout the lockdowns, noting with pride that the store, a branch of a regional chain, had refrained from raising its prices. Chinese lockdowns have been far more restrictive than anything attempted in Western countries, with residents not allowed to leave their homes for any reason apart from mandatory testing. Ruili officials were particularly enthusiastic enforcers of those rules. Restaurants and small food markets were shut down, with groceries available only through deliveries from large retailers such as Daxing. Qiu and her staff typically filled as many as 500 orders a day. During the most difficult stretches, she said, she received periodic calls from customers claiming to be completely out of food. Qiu assumed they were exaggerating. “They couldn’t have nothing,” she remembered thinking. She still tried to prioritize their orders, just in case. In October 2021, a former deputy mayor of Ruili, Dai Rongli, published a blog post titled “Ruili Needs the Mother Country’s Love.” In it he argued that, because of its position on the border, the city was bearing a disproportionate burden in keeping the virus out of China. In a subsequent TV interview, Dai said that some of his ex-colleagues in the municipal government were so overwhelmed with preventing infections that they hadn’t been home for months. Dai’s statements were the first many Chinese citizens had heard of the situation in Ruili, and they prompted an outpouring of sympathy on social media, with commenters expressing shock at the extent of lockdowns and testing there. It was a   rare barometer of the   national popularity of Covid Zero policies in a country where opinion polls are heavily restricted. (In a statement issued the day after Dai’s blog post was published, the Ruili city government said his descriptions of the situation were out of date. He didn’t respond to requests for comment.) China’s leaders are well aware of the economic repercussions of their policies. The lockdowns that began in Shanghai in March this year paralyzed the country’s wealthiest and most vibrant metropolitan area for two months, significantly slowing the national economy and showing that no one would be exempt from the harshest forms of viral control. Gross domestic product barely rose in the second quarter, and youth unemployment has hovered near a record 20%. Immigration consultants have reported a boom in business, as wealthy residents seek to move abroad. National officials have taken steps in recent months to cut quarantine times, promote spending and investment, and punish local bureaucrats for overzealous enforcement, but these measures have amounted to minor tweaks. Curiously, even though the government has shown no hesitation about imposing coercive measures such as lockdowns, it has   stopped short of requiring vaccination. Only 61% of citizens over 80 have had two shots—all of them with Chinese-made vaccines that have proven less effective than those used in the US. And the risk from the virus remains high. Hospitals are underresourced, especially outside big cities, and a large outbreak would severely strain the health-care system. In  an analysis published in May by , researchers at   Fudan University in Shanghai estimated that, with almost no natural immunity in the population, if the omicron variant were to spread in China without mass testing and lockdowns, it could result in as many as 1.6 million deaths. A viral catastrophe on that scale would severely test the reputation for administrative competence that the Communist Party has placed at the core of its political pitch since the 1990s. In July, Xi told officials that he believes China’s approach continues to be the right one. “We have protected people’s lives and health to the maximum extent,” the president said, “and achieved the best performance in the world in coordinating economic development and epidemic response.”
Everbright Headwear, which supplies hats bearing the logos of the   New York Yankees, the   Dallas Cowboys, and other teams to Buffalo-based   New Era Cap LLC, opened a factory in Ruili in 2019. The company was following an increasingly common path for Chinese manufacturers as wages rose and the working-age population was constrained by the legacy of the one-child policy, in force from 1980 through 2015. Hiring had been difficult in Jiangsu, the heavily industrialized province where Everbright has its headquarters, but in Ruili the company could employ large numbers of Burmese workers who were in China legally. It could house them in on-site dormitories and pay them about $450 a month, half of what a Chinese employee would demand. The long-term plan, factory manager Chen Xile told  reporters, was to expand the plant from 400 staff to more than 1,000, who would account for 40% of Everbright’s overall production capacity. (The company sometimes fills custom orders for top athletes, among other services; Chen can recall  LeBron James’s head size from memory.) But the pandemic and the border closure brought attrition. When workers returned to Myanmar, whether to visit family or, in some instances, because a loved one had been killed in the country’s   ongoing civil conflict, they couldn’t come back. By Aug. 11, Everbright was down to fewer than 300 personnel, leaving Chen desperate for replacements. He joked that his staffing policy now amounted to “If you’re human, you’re hired.” Ruili locals didn’t appear to have much interest in making hats for relatively low wages, forcing Everbright to move much of its production abroad, to Haiti and Laos. Its factory in Laos, which opened in 2021, has grown to 4,000 workers and is now the company’s main production base. “We’d rather be in China,” Chen said. But access to labor was crucial. “It’s all about volume. If you can’t get volume up, everything is hard.”
Apart from manufacturing, Ruili’s economy revolves largely around jade, which has long been prized in China, particularly for jewelry. Myanmar is by far the largest jade producer in the world, and Ruili is the traditional conduit for shipments heading north. At the Duo Bao Zhi Cheng market, Ruili’s largest for jade jewelry, many merchants were already shifting their operations at least partially online prior to the pandemic, part of a broader transformation for the social media age. Jade dealers have become some of China’s most enthusiastic livestreamers, creating what are essentially smartphone-optimized QVC broadcasts, with hosts interacting constantly with viewers through a chat function. See a bracelet you like? Text the host any questions you may have and then haggle for a better price, perhaps inspiring some theatrical shouting. Jade sales have the added appeal of being streamed from crowded, lively markets, providing local color that some buyers find irresistible. One of the sellers at Duo Bao Zhi Cheng market, who would give only his surname, Li, said he’d started with a traditional jade stall. Then his daughter tried running some livestream sales during her summer break from vocational school. The money she made in a month was enough to persuade her to drop out and for her father not to stop her. In 2019 they sold as much as 100,000 yuan of jade per day, 70% of it online. In the spring of 2021 Ruili officials shut down the jade market, fearful that livestream sessions, which can attract dense groups of spectators, would spread Covid. Livestreaming from home was impractical, not least because of the difficulty of sending orders to customers from locked-down apartment buildings, and the trade more or less shut down for over a year. The Chinese government also halted cross-border shipments, insisting, contrary to international scientific consensus, that Covid can be spread on the surfaces of consumer products. The jade market reopened only this April 28, and cross-border shipments have resumed in small volumes. “When they said the market was reopening, I was so excited,” Li recalled. “I’d been sitting at home for a year.” He was hopeful he’d soon get back to pre-pandemic levels of business. But for everyone in Ruili, as in the country beyond, normality is precarious. It took just a single positive test for the government to initiate the September lockdown, which covered about half the city. Earlier in the month officials confined the 21 million residents of Chengdu to their homes after a flare-up of infections, shutting down a vibrant hub of industry and culture in Western China. For the time being, China’s leaders are willing to pay the high price of Covid Zero, and citizens have no choice but to go along. A 32-year-old jade dealer, one of the few Ruili residents  managed to interview without supervision from local officials, was fatalistic. Whenever the virus appears again, he said, he plans to do what the government tells him. There’s no other choice, he said, and no point worrying about a future over which he has no control. “Ruili is now the safest place in China,” he asserted, half-joking, “because we stopped everything.”
More stories like this are available on bloomberg.com
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This Is What Life’s Like in the World’s Strictest Covid Zero City

The Hong Kong Polytechnic University (PolyU) recently signed memoranda of understanding (MoU) with three strategic partners to further propel the “GBA PolyVentures 2025” blueprint laid down by the University to leverage PolyU’s experience in innovation and entrepreneurship education to provide the necessary support for nurturing deep tech ventures and accelerating their growth. The collaboration also aims to translate research excellence into societal impact to contribute to the development of innovation and technology in the Greater Bay Area (GBA). The MoU was signed between PolyU and its strategic partners, namely Everbright Limited, StartupHK Fund and Hai Robotics. PolyU’s Deputy Council Chairman noted that the signing of the MoU between PolyU and its strategic partners echoes with the needs of the Nation and leverages the strengths of PolyU and other parties in working together for the development of innovation and technology in the GBA. One of the strategic partners is a start-up that provides autonomous case-handling robotic systems. It was founded in 2016 by a 2021 graduate Mr Richie Chen and a 2014 graduate from PolyU’s Department of Electronics and Information Engineering. The start-up witnessed rapid growth by making use of the manufacturing advantages of the GBA and benefitting from the enormous opportunities of the Mainland China market. The start-up announced recently that it has completed two rounds of financing garnering US$200 million in total, and its valuation has exceeded US$1 billion. The Secretary for Innovation and Technology of the HKSAR Government commended the GBA PolyVentures 2025. He said that the National 14th Five-year Plan indicates clear support for Hong Kong’s development into an international I&T hub and integration into the overall development of the country. The deepening collaboration with the Mainland, active participation in the development of the GBA and the integration into the nation’s development are pivotal to the future innovation and technology development in Hong Kong. The HKSAR Government has all along attached great importance to university-industry-research collaboration. It is hoped that the synergies generated can enhance the innovation power in Hong Kong, drive the innovation and technology development in the Guangdong-Hong Kong-Macao Greater Bay Area and contribute to national innovation and achieve high-quality technological self-reliance. PolyU’s President stated that to further promote the development of research and entrepreneurship in the GBA and to nurture future research talents to address the market needs, PolyU continues to collaborate closely with industry partners through ‘GBA PolyVentures 2025’, providing comprehensive support for start-ups in different stages from education and incubation, to accelerating and strengthening their development. The goal is to distil more than 300 seed stage innovation start-ups into at least 20 deep tech ventures each year and to nurture 25 impactful scale-ups in the GBA in the next few years through collaboration with strategic partners and various supporting initiatives. According to the MoU, PolyU and the start-up will explore establishing a joint innovation centre to promote PolyU’s education in innovation and entrepreneurship, nurture talents in “New Engineering”, and conduct applied research in robotics-related topics. Meanwhile, PolyU and Everbright Limited will invest resources to help start-ups develop through collaboration between technology and industry, provide support to promising research projects, and roll out an internship programme for nurturing innovation talents. PolyU and StartupHK Fund will co-invest in PolyU’s start-ups and help them enter the GBA market as well as launch initiatives to strengthen entrepreneurship education. PolyU is also committed to providing high-quality education that keeps pace with the times and meets societal needs. The University will implement departmental scheme-based admissions from the 2022/23 academic year onwards, introducing two new elements of “Artificial Intelligence and Data Analysis” and “Innovation and Entrepreneurship”. In addition, PolyU established the College of Undergraduate Researchers and Innovators and Residential College to encourage undergraduate students to conduct scientific research under the guidance of PolyU’s professors. These initiatives are all designed to inspire students’ scientific curiosity and enhance their innovation capabilities. PolyU places high importance on nurturing technology ventures. PolyU recently signed an MoU with the Hong Kong Science and Technology Parks Corporation (HKSTP) to kick off pre-incubation at university through the PolyU Micro Fund Scheme 2.0, which provides six months of entrepreneurship training to help entrepreneurial projects enter HKSTP’s start-up incubation programme directly. In addition, PolyU has launched two key programmes that leverage the unique advantages of the technology and innovation ecosystem in the GBA. The first is PolyU’s GBA Startup Postdoc Programme targeted at PhD graduates who are determined to start their own businesses. Under dual academic and industrial mentorship, participants can simultaneously continue with their research and start their own business for the commercialisation of their research outputs. Since the launch of the programme over a year ago, six PhD students have won nine awards in total. Six start-ups have been established to receive post-incubation support; some of them have even received angel investment. PolyU will extend the programme to both Shenzhen and Hong Kong to attract more technology and innovation talents to develop in the GBA. The second key programme is the GBA Maker Programme for hardware start-ups. PolyU makes full use of its unique advantages and facilities in manufacturing engineering, such as PolyU’s Industrial Centre, to combine Hong Kong’s edge in innovative technology and the manufacturing capabilities of the GBA to nurture top-notch hardware start-ups. Through “GBA PolyVentures 2025”, PolyU aims to systematically accelerate the growth of start-ups through education and incubation and ultimately contribute to the development of innovation and technology in the GBA by deepening the collaboration with strategic partners and leveraging their resources, experience and network, with the support of PolyU’s new “Entrepreneurship Investment Fund”.

MoUs to Enable Deep Tech Innovation at PolyU

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Everbright (300906.SZ) is an enterprise specializing in the research and development, production, sales, and service of railway measurement and control products.

Everbright

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Date	11/5/2020
Round	IPO
Amount	$79.9M
Investors	Public
Valuation	$99M
Revenue	0 FY undefined
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