In China coronavirus clouds, there may be a silver lining for Bangladesh exports

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When the world is fighting a new coronavirus outbreak tooth and nail, some analysts and businesses believe the outbreak in China may augur well for Bangladesh’s economy by boosting its dipping exports.

The risk of escalation of a conflict in the Middle East following the recent US killing of a top Iranian military commander in Iraq had snuffed out Bangladesh’s chances for a turnaround in export earnings after a slight growth in December following a four-month decline.

Now the coronavirus outbreak may force the US, European countries and others to divert readymade garment orders to Bangladesh, the second largest apparel exporter after China.

“No country will buy goods from China for many more days in this situation. The orders destined for China may come to Bangladesh in that case. It may cast off the shadow from our export earnings,” Ahsan H Mansur, executive director of the Policy Research Institute, told bdnews24.com on Sunday.

Rubana Huq, the president of the association of entrepreneurs of the largest exporting sector readymade garment, believes so.

The effect will be “temporary”, she added.

The outbreak, however, has come as a blow to some big retailers because they had to shut down stores in China due to the coronavirus outbreak, Rubana, the BGMEA chief, pointed out.
“Sales are expected to drop and therefore sourcing of products may also decrease,” she said.

“On the other hand, some immediate orders from China will be shifted. And major contenders are Vietnam, Cambodia and maybe Bangladesh, if fortune favours us. But this is temporary,” the BGMEA chief said.

Bangladesh exported goods worth $19.3 billion in the first half of 2019-20 with a 5.84 percent drop year-on-year and missing the target by 12.77 percent.

Mansur also warned that a pandemic outbreak of the virus across the world, or a further spread in China, will bring the global economy, including Bangladesh’s, it its knees.

“Because every country has trade relations with China,” he said.

The new virus has claimed over 300 lives with the first death outside China reported on Sunday.

“Now everything depends on how bad the situation will get,” Mansur said.
Source: https://bdnews24.com

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