China and Covid, opportunity and cost

Economists have created the concept of opportunity cost to describe the potential forgone profit from choosing one alternative and forgoing another.

New Zealand faces an opportunity cost dilemma of multimillion-dollar proportions in the coming weeks as it decides what to do about China throwing open its borders to the world after many months of the tightest Covid-19 restrictions on the planet.

As New Zealand knows only too well, when Covid-19 is ineradicably in the community it comes at a cost: 32,000 new Christmas-wrecking cases in the past week, almost 2000 of those in Otago and Southland.

China is now enduring what New Zealand and other health systems have weathered, with varying degrees of success: crushing case numbers and sometimes unsustainable pressure on hospitals and primary care.

That is the opportunity cost of opting to revive a moribund economy: while people can get out and about and start spending again, they will also inevitably spread Covid-19 and other infections.

New Zealand opened its borders and through doing so introduced the alphabet soup of Covid variants which have laid so many people low, but at the same time has resulted in places like Dunedin having streets teeming with shoppers at what otherwise would be a time when the retail and hospitality sectors slumbered.

China’s decision to abandon its Covid barricades will be welcomed by New Zealand exporters, who have been craving easier access to what is one of this country’s most important markets.

Tourism operators will also be hoping that China giving the green light to international tourism will revive what was once the second-biggest source of visitors to New Zealand, behind our neighbours in Australia,.

In the year before the pandemic about 407,000 Chinese visited New Zealand and in total spent $1.7 billion in our shops, restaurants, hotels and tourist attractions — about $4600 per head.

With figures like that, even if the initial number of vacationing Chinese is a trickle rather than a flood, it can still be a substantial fillip to the tourism sector.

But, and it is a substantial but, as Covid sweeps their homeland some of those tourists are quite likely to bring the disease with them as unwanted baggage.

Some countries have already sought to restrict visitor numbers from China, but such crude measures would have little impact on the very real risk of in-flight transmission.

Empty roads in Shanghai during a phased lockdown in April. Photo: Getty Images
Empty roads in Shanghai during a phased lockdown in April. Photo: Getty Images
Others are considering testing Chinese visitors at the border, but this is to ignore that this is a pandemic: a visitor from Balclutha is as likely to have Covid-19 as one from Beijing.

Even University of Otago epidemiologist Michael Baker, who normally advocates utmost caution when it comes to Covid, is unconvinced by border testing.

He can see a valid public health argument for pre-departure testing, and this seems sensible advice.

It is current public health advice in New Zealand not to travel or mingle if you have Covid-like symptoms and that should apply equally to our visitors

We want people to come and experience all that New Zealand has to offer, but do not want that to include the country’s health system.

And another thing

There will always be arguments about who is the best footballer of all time.

Any of those debates will necessarily feature Edson Arantes do Nascimento, universally known as Pele.

A World Cup winner aged just 17 and a three-time World Cup winner by his retirement from playing football in 1977, Pele’s 20-year career spanned generations and transcended sport.

His career statistics are astonishing: 77 goals in 92 games for Brazil, 655 goals in 700 club games.

All were accomplished with a broad smile on his face and with an artistry and grace which endeared him to fans worldwide.

His death yesterday aged 82 was not unexpected given Pele’s lengthy illness.

But thanks to his international career beginning four years after the first televised World Cup, fans the world over could then and can still marvel at his remarkable career.