China coronavirus epidemic poses a threat to BD trade

Bangladesh's trade and economy may suffer badly thanks to the continued Coronavirus contagion in China, because the former is very hooked in to the world's second largest economy for its industrial raw materials and finished goods.

Nearly 28 per cent of the country's import comes from China, followed by India, nearly 14 per cent.

China supplies mostly fabrics and garment accessories to local clothing manufacturers, on which Bangladesh's major export sector is very dependent, sector insiders told the FE.

More than 40 per cent of its textile and textile-related goods come from China. Nearly 30 per cent machinery comes from there, consistent with the Bangladesh Bank statistics.

The country's import from China also includes agricultural machinery, mobile sets, electrical and electronics goods, fruits, and essential spices etc.

"We're really worried, because the country is very hooked in to China," said Anwar ul Islam Chowdhury, president of the Bangladesh Chamber of Industries (BCI), a trade-body having over 1,000 members.

Currently, China is observing New Year , the country's biggest festival, and most its factories are closed. So, the particular impact of Coronavirus outbreak that began in Wuhan last month are going to be felt after the top of latest Year vacation, as affected people need a minimum of fortnight to be confirmed.

"We're thus far ok. But after the holiday , supply of products and raw materials from China could also be trimmed," Mr Chowdhury, also chairman of Evince Group - a number one clothing manufacturer, told the FE.

"To my mind, local woven sector could also be the worst victim, because it is very hooked in to import from China," he opined.

Any critical situation within the Coronavirus-affected Chinese cities might bear down supply of raw materials from there, and thus affect Bangladesh's export sectors that are struggling in recent months.

Abul Kasem Khan, a former leader of the Dhaka Chamber of Commerce and Industry (DCCI), said, "We can see only a negligible economic impact now, but the uncertainty eventually implies that Bangladesh isn't immune."

"We do not have any alternative to China. If the epidemic lasts longer and spreads to other nations, it could affect not only Bangladesh but the entire world also."

Mr Khan went on: "Clothing factories normally have very small inventories. If the outbreak continues for a month approximately , it'd impact the country's trade and economy during a negative way."

He, however, said the govt has much information (regarding the situation), and can take necessary steps for handling it.

At present, variety of Chinese people are working in several large infrastructure projects in Bangladesh, including the Padma multipurpose bridge, and that they also are contributing to the country's tourism sector also .

Siddiqur Rahman, vice chairman of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), told the FE that implementation of those mega projects can also suffer as a results of the Cornovirus outbreak.

"The number of Chinese people, involved in mega projects, is huge. So, the country's development works also as tourism sector could also be affected," he opined.

In the meantime, the Chattogram Port Authority (CPA) has taken an initiative for screening goods at the port to prevent spreading the Cornovirus outbreak through goods and traffic from China.

Bangladesh has already decided to prevent issuing on-arrival visa for Chinese nationals amid growing concern over the Coronavirus outbreak, secretary of state A K Abdul Momen said on Sunday.

"This may be a temporary decision," he told reporters at a news conference at the Ministry of Foreign Affairs before the Prime Minister's Italy visit on February 4-8.

Dr Ahsan H Mansur, executive of the Policy Research Institute of Bangladesh (PRI), told the FE that the tiny investors, who frequently visit China for visiting factories and exploring business, are going to be impacted much.

Dr Mansur, however, said now there's a chance for Bangladesh to grab a share of Chinese clothing market, as many foreign buyers will look for alternative sourcing of their products.

"Trade could also be diversified, and Bangladesh could also be benefitted," he added.

Traders said international commodity market has been during a volatile situation since the Coronavirus epidemic in China.

Abul Bashar Chowdhuiry, a number one importer of commodities, told the FE: "Prices of Chinese goods will jump following the outbreak."

Meanwhile, in response to things , international airlines are suspending or curtailing their flights to and from China, following a pointy fall in number of passengers, consistent with Flightradar24.com.

Some major airlines like British Airways and Lufthansa Group (Lufthansa, SWISS, and Austrian) have canceled all their flights to China, while others like United and American Airlines have drastically reduced their schedules, it added.

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