Businesses in Shanghai are still feeling the impact of the Covid lockdown that lasted for over 60 days, three months after restrictions were eased, as recovery remains sluggish.

Although movement restrictions were abandoned on 1st June, the city’s 25 million residents continue to struggle to lead normal lives. The country’s zero-Covid policy still requires localised lockdowns of apartment blocks and neighbourhoods should new cases emerge.

Regular testing is also mandatory to be able to use public transport and enter indoor spaces, as well as two-week quarantine at a government facility in certain cases.

Consequently, demand remains well below pre-pandemic levels for dining out, shopping and tourism-related activities, with Shanghai’s recovery taking far longer than Hong Kong and Singapore after their restrictions were eased, Bloomberg reports.

Retail sales in Shanghai declined 4.3% in June compared to the year before and rose by just 0.3% in July. This followed an average 35% drop in the prior three months, when the outbreak was announced.

Even though Hong Kong reported a string of Covid outbreaks earlier in the year, the city gradually relaxed restrictions at the end of March, lifting flight bans and reducing quarantine time. As a result, monthly retail sales returned to growth a month later.

Likewise, in Singapore, growth accelerated straight after restrictions were eased in March.

Moreover, shopping centres in Shanghai have reported a surge in vacancies, rising 7% in Q2, surpassing a so-called “warning line” of 5%. This followed zero-Covid lockdowns hammering consumer demand, according to research of 20 major shopping centres by China Real Estate Information Corp (CRIC) at the end of August.

One of the worst affected, Super Brand Mall, located in Shanghai’s Lujiazui financial district, saw 34% of its stores close down.

Food and daily necessities are still the principal driver of the post-lockdown recovery in the city, according to consumer surveys carried out by Mintel, polling 100 residents of Shanghai