By Christian Kraemer

BERLIN (Reuters), German businesses doing business in China have concerns that the Omicron coronavirus version will lead to more restrictive Beijing lockdown measures, which could worsen supply chain issues.

Jens Hildebrandt from DIHK, China’s executive director, said in an interview that “the Chinese strategy with targeted locksdowns has proven very effective so far.”

Hildebrandt explained that Omicron, a more dangerous variant of Omicron, may challenge China’s zero COVID approach, particularly as more Chinese will travel to the country for the holiday season.

“There will still be lots of travel, despite all warnings,” he stated.

Friday’s call by the International Monetary Fund (IMF), to China, was made after the Omicron virus emerged.

Kristalina Georgieva, IMF’s Managing Director, stated that the strategy of sealing entire cities with many millions of residents has been increasingly a burden on the global and domestic economies.

Hildebrandt declared that the criticisms of IMF are not completely unjustified.

He said Beijing will likely stick with its zero COVID strategy because Chinese vaccines are not as effective as Western mRNA vaccines against Omicron.

The concerns of the DIHK were echoed in part by the BDI Industry Association.

“Should Omicron’s variant be transmitted quicker and more easily in China,” BDI wrote in Monday’s “Global Growth Outlook” publication.

BDI warns that thousands of Omicron-infected foreigners will be entering the country as the Olympic Games begin in Beijing next week. This could lead to tighter lockdowns.

It said that this could present new problems for both producers and exporters, as well as businesses at the ends of the supply chain.

“The bottlenecks could also lead to higher prices that would affect inflation,” BDI reported. According to BDI, the development of the coronavirus epidemic in China poses a threat for Germany’s recovery.