Aurelia Butler

Winter warmth: a Norwegian ship arrives last month at a new liquefied natural gas terminal in Lubmin, Germany. © Getty ImagesIf 2022 witnessed the weaponisation of energy supplies in support of Vladimir Putin’s invasion of Ukraine, the winners and losers of the ensuing gas price conflict will become clear in 2023. Evidence points to the potency of energy as a weapon, but also to the unforeseen consequences of its use. There is every chance that what appeared to be a European energy crisis will backfire on Russia itself. Even before the Russian president ordered tanks into Ukraine, he had been squeezing supplies of gas to the EU, which had been reliant on Moscow for 40 per cent of its imports. Soon after February’s invasion, the US and Europe imposed strict economic and financial sanctions on Russia, leading to skirmishes over the currency that EU nations would use to pay for its gas. But the real conflict erupted in the summer, when Russia halted gas supplies through the main direct pipeline to Germany, resulting in an energy crisis across the continent. With fears of supply shortages over the winter, and IMF warnings of economic downturns as deep as during the Covid crisis in some eastern European countries, the price for European natural gas soared. The cost of a megawatt hour of gas went from €25 to more than 11 times higher — at just over €340 in August. The seriousness of the crisis was for all to see. According to Berenberg Bank, such is Europe’s dependence on imported gas that, for every sustained €100/MWh increase in the price, EU members would need to pay gas exporters an extra €380bn a year — equivalent to 2.4 per cent of Europe’s GDP or 4.5 per cent of household consumption. Europe’s sanctions appeared to be hurting its own people more than those in Russia. However, after a hot European summer of energy wars, autumn brought continental relief rather than fear. European governments saw the crisis as a significant threat and most cushioned the blow for households and companies, with plans to spend about 3 per cent of national income on energy subsidies, according to think-tank Bruegel. More importantly, according to economics professor Ben Moll of the London School of Economics, evidence emerged that higher prices were encouraging households and companies to cut their gas consumption and find alternatives to Russian supply at relatively low costs — showing European economies to be more resilient than feared. “The demand response was much larger and the economic costs were much smaller than many observers predicted earlier last year, in particular industry CEOs and lobbyists who predicted economic Armageddon if Russian energy were to stop flowing,” Moll says. According to Carsten Brzeski, global head of macroeconomics at ING bank, “unless the continent gets caught out by a severe winter in the coming months, the risk of an energy supply crisis has become extremely low”.

© REUTERS/Yves Herman

Ursula von der Leyen, president of the European Commission, became confident enough to declare victory in December: “We have managed to withstand Russia’s energy blackmail . . . the result of all this is that we are safe for this winter.”As 2023 started, European gas storage facilities were roughly 85 per cent full compared with an average of 70 per cent at the same time of year during the past five years. The European price of natural gas was down by more than 75 per cent from its peak and hovering at around €75 per MWh in the first week of January. That was still three times normal levels and much higher than in the US, but a price that many households and industries would be able to manage. Still, energy specialists warn against complacency. Chinese liquefied natural gas demand might soar this year as China’s zero Covid policy ends, they point out, accompanied by huge volatility in energy prices. Fatih Birol, executive director of the International Energy Agency, has cautioned that “many of the circumstances that allowed EU countries to fill their storage sites ahead of this winter may well not be repeated in 2023”.But the geopolitical outlook for energy appears much more favourable than it did when Russia first invaded Ukraine. Ole Hansen, head of commodity strategy at Saxo Bank, says that, with European gas demand down 10 per cent, “the continent has now ended up in a situation, unthinkable just a couple of months ago, where prices need to stay low in order to divert LNG shipments away from Europe, in order not to overwhelm storage facilities”.Analysts say there will be further shifts in 2023 away from gas and towards renewable electricity generation, and more reorganisation of industrial processes — thus, increasing the security of Europe’s economy and leaving Russia short of its main gas customer.Simone Tagliapietra, a senior fellow at Bruegel, envisages continued reductions in European gas demand. “Decarbonisation is being brought forward by years as structural changes are put in place,” he says, and “the effects are already being felt.” More

In challenge, there is opportunity. This truism is especially apt for companies heading into what will probably be a gloomy earnings season amid expectations of a global downturn. S&P 500 earnings forecasts for the fourth quarter of 2022 are worse than they were right after the collapse of Lehman Brothers in 2009 or during the deflation of the dotcom bubble in 2002.Many companies will respond to this by cutting costs with an extra-large pair of corporate shears. The technology sector, for example, is in the midst of massive lay-offs. And other industries may soon follow Silicon Valley’s lead. Plenty of corporate leaders look at a downturn as the best time to cut costs and people in order to hang on to their margins. But there is good data to show that the companies that not only survive but thrive in tough times tend to use a three-pronged approach — cuts, yes, but also a decrease in financial leverage and increasing investment in order to grab market share. Most importantly, they act proactively rather than reactively, getting their house in order before the cycle bottoms, so as to be ready to capitalise on cut-rate acquisitions or lure choice talent. A new McKinsey study that looks at 1,200 public companies in the US and Europe between 2007 and 2011 provides a window into this wisdom. The companies that had the best shareholder return during this period (meaning those in the top 20 per cent) were the ones that did three things. They bolstered retained earnings and working capital before the downturn. They also decreased their financial leverage. This created “reserves that they then spent on value accretion, such as acquisitions, R&D and capital investment, during the rebound phase,” says Asutosh Padhi, head of McKinsey North America.While some cash rich industries, such as technology or energy, were and are better positioned to do these things, the strategy of pulling growth and margin levers together, rather than simply battening down the hatches and cutting, works across every sector.If we look back at the aftermath of the 2008 financial crisis to find those companies that did well, one could point to the tech giant Qualcomm, which kept R&D high and pursued strategic acquisitions. But you could also look at a retailer like Urban Outfitters, which began 2009 with no debt and plenty of cash on hand, and was able to expand while its competitors were cutting.None of this is rocket science. But it does require financial discipline, something that the last economic downturn in 2020 did not require of companies, since rates were still low and credit was loose. While new leveraged-loan issuance was down by nearly a third year on year to October 2022, as rates have risen, companies refinancing their existing debt this year and beyond face considerably higher expenses than they did in the past.This includes plenty of household names across a variety of sectors. While it’s difficult to know exactly which companies are going to have major issues servicing their debt in the future, the New York-based financial analytic firm Calcbench took a stab at the question in a small study, examining 22 non-financial S&P 500 companies that filed their annual reports in the previous autumn and had a debt disclosure within that report. Of those businesses (which included companies such as Sysco, Oracle, Fox, Campbell Soup, Clorox, Seagate Technology, News Corp and Tyson), ten had annual interest expenses that were already more than 10 per cent of net income, even with average interest rates ranging from 2.38 per cent to 3.22. That’s a big debt load by percentage of net income, and one that will probably have to be rolled over at significantly higher rates. Plenty of companies set to report over the next few weeks are in the same boat. January is the month in which investors will achieve more clarity on how much debt needs to be rolled over, and how much higher interest rates will impinge on the ability of companies to increase revenue. The overleveraged ones will find themselves boxed in and unable to do much aside from cut costs if they are to keep net income up (if indeed they can).While cuts can keep a corporate ship afloat, they come with all sorts of downsides. Consider another transatlantic lesson from the post financial crisis period. American manufacturers slashed workforces following the crisis, but ended up losing market share in Asia to German competitors, who used a furlough system to retrain and upskill workers and repair equipment. This meant that the Germans were more quickly able to fill orders when the Chinese recovery began in 2010, because they were tooled up and ready to go, rather than struggling to rehire and retrain like US firms.This lesson around treating labour as an asset rather than just a cost on the balance sheet has particular resonance now, when jobs markets remain tighter than usual as we go into what could be a global recession. Silicon Valley firms have room to cut their workforces given the increasing frothiness of the sector over the past few years, but many other industries are still desperate for talent. They would be wise to think about the mid to longer term before distributing too many pink slips.While the next few months will be challenging for executives, they will be illuminating for investors. For years, easy money has disguised well-managed, proactive companies from more reactive ones. The curtain is about to be pulled [email protected] More

Tyler Cowen has only drunk coffee twice in his life. He only drinks tea if someone offers it. He doesn’t touch alcohol. “Alcohol is bad for everyone’s productivity.”Instead Cowen’s drug of choice is information. He isn’t just an addict — he’s a peddler, a kingpin. Through his blogs, podcasts and books, he spreads big thoughts and highbrow trivia. He is among the most eclectic economists. He champions markets and big business. He insists that artificial intelligence, starting with chatbots such as ChatGPT, is about to change the world. But he also writes about restaurants, films and books — because he enjoys them, and because he’s convinced that culture shapes markets (and vice versa). “People should collect more information about music, about economics, about books. So I try to show them how I do that.”A professor of economics at George Mason University in Virginia, Cowen has become a cult figure among a hyper-intellectual elite bent on self-improvement. At Marginal Revolution, the blog that he co-founded in 2003, he highlights the latest research on, say, why the US gender wage gap stopped narrowing (family leave policies) and how long Roman emperors lasted before being killed. Devoted readers include author Malcolm Gladwell and, Cowen is told, the UK prime minister, Rishi Sunak. But he wants more. He has launched an online university, made up of free economics modules.

“My personal ambition is to be the individual who has done the most to teach the world economics, broadly construed,” he tells me. When I ask who his competitors might be for this title, he starts by naming Adam Smith and John Maynard Keynes.Cowen’s brand of economics is practical. Last year he and Daniel Gross, an entrepreneur, published a book, Talent, about how to hire creative individuals. Some organisations eschew unstructured interviews, worried that they discriminate against candidates. Cowen celebrates such free-flowing interviews, particularly if the interviewer asks about things that they’re genuinely interested in.He often delights in being contrarian. When we meet in London, the consensus is that Britain’s economy couldn’t be much worse. He disagrees. “I view south England — London, Cambridge, Oxford — as one of the most marvellous parts of the world, one of the few places where you can really birth and execute a new idea. You see it with the [Oxford Covid-19] vaccine, you see it with DeepMind [Google’s AI unit founded in London]. This corner of England: it’s already passed Singapore-on-Thames. You’ve left Singapore in the dust!”Doesn’t Britain lack animal spirits? “That’s true, partly. I wish the ethic of working hard and having a lot of money were [seen as] more unambiguously positive. But not everywhere will be like America. The strong suits here are so strong. London is literally the best city in the world.”This is typical Cowen: quick to rank people, places and cultures. Others would say, for example, that all major cities have good Asian food these days. “That’s not true! While there is plenty of good Asian food in Paris, you can’t just stumble upon it.”He has an unfashionable love of generalisation. “People think this stuff anyway, they’re just afraid to say it. Why not just say what you think?” He sees himself as more “psychologically integrated. My natural inclination is just to tell you what I think.”

He wants to push economics beyond academic methods. He hasn’t written any peer-reviewed articles since 2017. “I’ve done plenty,” he says. “A lot of [economics] is too narrow. I’ve tried to engage with real world issues and express uncertainty when and where I feel it. I think that resonates with a great number of people.”Cowen, 60, was not always curious. He grew up in New Jersey with little interest in exotic food or travel. Then in his late teens he started travelling to New York, with its concerts, crowds and used bookstores.He had his first economics papers accepted by journals aged 19, and was a tenured professor at 27. But it was blogging that allowed him to find his audience. “The modern internet totally changed my life.”Cowen’s superpower is reading. He sees himself as hyperlexic, having the ability for prodigious reading. “If it’s a non-fiction book where I know something about it, I could read maybe five books a night.” He starts reading shortly after 7am, and eats dinner early, at about 5pm, finding it helps him work better in the evening. (Although he loves the diversity of cities, he lives in the Virginia suburbs, partly because of the tax rate.) His lists of best books of 2022 included 36 titles, including his own Talent, with the unashamed proviso: “These were the best books!” Yet he is open to non-readers: “Maybe books are overrated. Travel is underrated. Among smart educated people, books might be a little bit overrated.”Hyperlexia is often associated with autism, but Cowen does not have the social difficulties often felt by autistic people. In person, he is engaging and direct, his answers often helpfully blunt.Conversation, like reading, is a way he gathers information. But neither is enough. “If you only were to read, you might stay an idiot.” It’s writing that “forces you to decide what you think about something. If you get something written every day, no matter what the length, it adds up to quite a bit. It’s the people who go many days without writing who have productivity problems.”Since 2003, Cowen has written every day — “Sunday, birthday, Christmas, whatever.” On Christmas Day, he blogged on China’s zero-Covid polices. On Thanksgiving, he asked why more currencies weren’t more valuable than the dollar.What is Cowen’s overall credo? He seeks to view issues “drained of the emotion”. That leads him to an optimism about human progress, not dissimilar to psychologist Steven Pinker’s. He calls himself moderately libertarian, and has collaborated with the billionaire venture capitalist Peter Thiel’s foundation. He has also defended classical liberalism against the populist right, arguing that the latter, by fomenting distrust in elites, may accelerate “the Brazilianification of the United States”. “I don’t know whether I’m centrist on the issues, but I’m centrist on the mood and the approach.”He is excited by technological change, but favours institutional continuity, even if the US’s politics seem broken. “My core intuition is, if your per capita GDP is 30-40 per cent higher than that of most of your peer nations, probably not to change. I’ve always been anti-Trump [but] I don’t think Trump will win again, or even get the nomination again. But it seems to me the system works. And we’ve had a lot of policy change lately, not all of it good, but it’s not gridlock at all.”What does Cowen’s open-mindedness get him? He supported the former UK prime minister Liz Truss’s tax cuts, which led to her being ejected from office: “I thought the market overreacted.” In March 2022, he interviewed Sam Bankman-Fried, the founder of now defunct crypto platform FTX, and declared him “excellent”. (That interview displayed Cowen’s scattergun questioning: “I think the best french fries in the world are in southern Argentina, in Patagonia. Where do you think they are?”)Cowen first met Bankman-Fried a decade ago. They played bughouse chess, a variation of the game. “He was good. He was better at bughouse than at chess. It’s a very important concept for understanding FTX. You have four people and two boards. If I take your piece on this board, I hand it to my partner, and my partner can plunk the piece down in lieu of making a move. You can be in this desperate situation, all of a sudden your partner hands you a queen. So there’s no balance sheet in bughouse chess. Things come out of nowhere to save you. You play desperately and take a lot of risk. If people play bughouse, that’s their core mentality.”Cowen is a talent spotter. After interviewing Bankman-Fried, would he have hired him? “I would have funded him as a VC, I don’t know if I would have hired him as an employee. One thing Daniel Gross and I say in Talent is: conscientiousness is the hardest trait to judge and the easiest trait to fake.”Cowen remains hopeful about crypto. “Crypto is such a truly new idea. And people shouldn’t just dump on it.”In general, he sees disruption as unthreatening. “YouTube is the most important educational vehicle in the world,” but prestigious universities and large state ones “will keep on doing well”. Humans will get through the disruption of AI too, he says, although he challenges economists to try to predict the fallout more precisely. “We can’t predict business cycles, we can’t predict the effects of new technologies. Surely that should humble us a bit?”He plans to focus less on writing and more on speaking appearances, to adapt to a world where readers spend time with chatbots. “If they built a really good GPT [chatbot] that mimicked me, I would be really happy. It would make some version of me immortal. I’m 60, and I have tenure and other sources of income, so not everyone is in that position.”Cowen’s optimism has limits. “The chance of there being a nuclear war in any given year, I’m more optimistic than most people. But if you just run enough years, it will happen. How many years do you have to run before the chance is pretty high? My guesstimate was 700-800 years. You can argue about the number, but it’s not a million years. I don’t think it would kill all humans, but it would wreck what we consider civilisation.”Yet the prospect doesn’t seem to bother him. “If we have better institutions, make better decisions, we can make a difference.” For now, there are talented people to discover, interesting ideas to curate. He leaves our interview, no doubt to empty London’s bookshops and to fill his lifetime with as much information as will possibly fit. More

TOKYO (Reuters) – Japan’s annual wholesale prices rose at a faster-than-expected pace in December, data showed on Monday, adding to recent growing signs of inflationary pressure that could keep the central bank under pressure to raise interest rates.The 10.2% year-on-year rise in the corporate goods price index (CGPI), which measures the price companies charge each other for their goods and services, exceeded a median market forecast for a 9.5% gain, Bank of Japan data showed. It followed a revised 9.7% increase in November.While global commodity prices slipped, companies continued to pass on past increases in raw material costs for goods such as auto parts and electricity equipment, said a BOJ official briefing reporters on the data.The yen-based import price index rose 22.8% in December from a year earlier, slowing from a revised 28.0% gain in November, in a sign the currency’s recent sharp ascent helped temper the cost of importing fuel and raw material.For the whole of 2022, wholesale prices rose 9.7% on average from the previous year, hitting a record high since comparable data became available in 1981. It was much higher than a 4.6% gain in 2021.Speculation is rampant in markets that the BOJ could soon phase out its massive monetary stimulus as rising inflation pushes up long-term interest rates, testing its resolve to defend a newly set 0.5% cap on the 10-year bond yield.At a two-day policy meeting ending on Wednesday, the BOJ will likely raise its inflation forecasts and debate whether further steps are needed to address market distortions it sought to fix with December’s surprise tweak to its yield control policy, sources have told Reuters.Data due out on Friday is expected to show Japan’s core consumer prices rose 4.0% in December, double the BOJ’s 2% target and a fresh 41-year-high, in a sign of rising living costs for households, according to a Reuters poll. More

(Reuters) -Bain Capital is exploring the listing of its Virgin Australia airline on the Australian Securities Exchange, according to a statement from the private equity firm on Monday said.The firm said it would seek advice on the best timing and structure to “return Virgin Australia to the ASX”.Bain bought Virgin Australia for A$3.5 billion in 2020 after the airline was placed in voluntary administration. Creditors approved the buyout in September 2020. A listing of the airline could be one of the largest IPOs in Australia in 2023 after capital markets activity plunged in 2022 as a result of global financial market uncertainty.”In the coming months we will consider how to best position Virgin Australia for continued growth and long term prosperity,” Mike Murphy, a Bain Capital Sydney based partner, said in the statement. More

LOS ANGELES (Reuters) – The mayor of New York traveled to the Mexican border city of El Paso on Sunday and declared that “there is no room in New York” for busloads of migrants being sent to America’s most populous city.Eric Adams, a Democrat, was also critical of the administration of Democratic U.S. President Joe Biden, saying “now is the time for the national government to do its job” about the immigrant crisis at America’s southern border.The visit of a New York mayor to a southern border city about the issue of immigrants is unprecedented.Busloads of migrants have been shipped north to New York and other cities by Republican run states. That has exacerbated a housing crisis in New York and a worsening homeless crisis in the city.Adams’s trip to El Paso comes after he said the migrant influx into New York could cost the city as much as $2 billion, at a time when the city is already facing a major budget shortfall.In recent months the Republican governors of Florida and Texas have sent thousands of migrants seeking sanctuary in the U.S. to cities run by Democratic politicians, including New York, Chicago and Washington, D.C. More

SINGAPORE (Reuters) – The Japanese yen held near an over seven-month peak on Monday, as traders, in the lead up to the Bank of Japan’s monetary policy decision this week, ramped up bets that the central bank could make further tweaks to its yield control policy.The yen was last 0.1% lower at 128.01 per dollar, having surged to 127.46 per dollar on Friday, its highest since May last year.Markets have been pressing for the BOJ to shift away from its ultra-easy monetary policy, which on Friday caused the yield on Japan’s benchmark 10-year government bonds to breach the central bank’s new ceiling.With the BOJ due to announce its monetary policy decision on Wednesday, expectations are for further tweaks to its yield control policy or a full abandonment of it.”I think the whole world will be focused on Wednesday … and probably the week in G10 (currencies) will be defined by what happens to the yen and yen crosses, out of that,” said Ray Attrill, head of FX strategy at National Australia Bank (OTC:NABZY) (NAB).”I don’t think (the BOJ) has the luxury of time to say that they’re going to assess and wait until Q2 or Kuroda to see out his term without making any further changes.”Current BOJ Governor Haruhiko Kuroda will step down in April.The BOJ’s yield curve control policy has been a huge factor behind the yen’s 12% slump last year, and since the central bank’s shock decision last December to widen the band around its yield target, the yen has jumped more than 6%.Elsewhere, the U.S. dollar struggled to recover from its decline after last week’s selloff on data showing that U.S consumer prices fell for the first time in more than 2-1/2 years in December.The euro edged 0.04% higher against the greenback to $1.0838, not far from Friday’s nine-month high of $1.0868.Sterling rose 0.05% to $1.2240, having similarly touched a one-month peak of $1.22495 on Friday.Better-than-expected economic data out of Germany and Britain also suggested both countries could narrowly escape a recession for now, lifting sentiment.Against a basket of currencies, the U.S. dollar index fell 0.13% to 102.13, languishing near Friday’s seven-month low of 101.97.”A U.S. dollar downtrend is well in train here, and I think there’s more to come,” said NAB’s Attrill.U.S. markets are closed on Monday for a holiday, making for thin trading.In other currencies, the Aussie was last 0.2% higher at $0.6989, while the kiwi gained 0.16% to $0.63955. More

China’s National Bureau of Statistics will on Tuesday release what is likely to be its third consecutive disappointing estimate for quarterly expansion, as the world’s second-largest economy falls well short of the government’s annual growth target of 5.5 per cent — already the lowest mark in decades.The Chinese economy narrowly avoided contraction in the second quarter, posting 0.4 per cent year-on-year growth, before expanding 3.9 per cent in the third quarter, in a release that was delayed during the Communist party congress where Xi Jinping secured a third term in power.The fourth-quarter reading will also have been dragged down by widespread lockdowns in the October-to-December period followed by the chaotic abandonment last month of President Xi’s contentious zero-Covid policy, even as the virus raced across the country.Here are five things to look out for ahead of Tuesday’s release.What is the likely upside this year for the Chinese economy’s rebound after zero-Covid?From an economic perspective, investors and markets will be more focused on this year’s much brighter prospects than last year’s disappointments.The World Bank is projecting full-year growth of 2.7 per cent for the Chinese economy in 2022, followed by 4.3 per cent this year. Some of China’s largest provinces are projecting growth of 5 to 6 per cent, and the government’s official growth target, traditionally announced at the annual session of the National People’s Congress in March, is likely to be 5 per cent or higher.“The exit from the zero-Covid policy has been much faster than expected,” said Larry Hu, chief China economist at Macquarie. “Such a dramatic U-turn implies deeper economic contraction in the fourth quarter but faster reopening and recovery in 2023.”Will Xi’s new team prioritise growth over minimising risk?For almost a decade, vice-premier Liu He, China’s retirement-bound economic tsar and close confidante of Xi, has emphasised the containment of financial risks, even at the cost of damaging traditional economic engines such as the property and technology sectors.China’s incoming premier, Xi protégé Li Qiang, now has an opportunity to redress this imbalance and revive the economy. Recent signals from senior Communist party officials — including visits by high-level cadres to Jack Ma’s two companies Alibaba and Ant Group — have suggested that their two-year crackdown on the technology sector is finally coming to an end.Are efforts to boost the property sector making their intended effect? Xi’s administration will want to support a consumption-led revival rather than unleash yet another credit-driven and ultimately unsustainable investment binge.But this is unlikely if the long decline of the property sector, the source of most household wealth, is not stabilised. Year-on-year property sales have not risen since the second quarter of 2021 and fell more than 50 per cent in the second quarter of last year.In recent weeks, financial officials have quietly relaxed leverage restrictions introduced to reduce banks’ exposure to the sector. The rules ultimately pushed one of the country’s biggest developers, China Evergrande, into default.As with many Chinese property developers, Evergrande funded its projects with presales. But as liquidity dried up across the sector and projects stalled, homeowners worried that they would lose sizeable down payments, wiping out buyers’ confidence in the market.Is the export boom over?In US dollar terms, China’s exports fell 0.3 per cent year on year in October, the first such decline since the early stages of the pandemic in 2020. November and December’s declines, of 8.7 per cent and 9.9 per cent, respectively, were even more dramatic.Overseas consumer demand, which supported China’s economy through the pandemic, is weakening and unlikely to recover soon. That will make it harder for the government to reduce high youth unemployment, which has increased from 12.3 per cent to 17.1 per cent over the past two years.Has China’s population peaked? A longer-term threat to China’s economic prosperity is its rapidly declining demographic profile. Its hopes of overtaking the US as the world’s largest economy, let alone becoming as wealthy on a per capita basis, will be dashed if this trend cannot be slowed.China recorded 10.62mn births and 10.14mn deaths in 2021, putting it on the cusp of its first year-on-year population decline since the Great Leap Forward famine. That risk will have been exacerbated by the surge in Covid-related deaths across the country last month.

Initial estimates for China’s last 10-year census showed that the population had peaked in 2020, according to people involved in the process, but were ultimately revised upwards to show a small population increase.On Saturday, the government estimated that 60,000 people had died directly or indirectly as a result of Covid in hospitals. The estimate omitted Covid-related deaths of people who died at home, in care homes or were never tested for the virus.Officials from the Chinese Center for Disease Control and Prevention have said that year-on-year comparisons of total deaths from before and after the abandonment of zero-Covid will provide the best measure of the true scale of the tragedy. But assessing its impact will not be possible until data for 2023 become available. More