Loading...
The Financial Express

PMO meets today to review coronavirus impact

Tariff commission fears serious impact on trade with China

SYFUL ISLAM | Published: February 25, 2020 09:49:41 | Updated: February 25, 2020 13:47:22


Picture used for representation. Source: Wikipedia Picture used for representation. Source: Wikipedia

The impact of novel coronavirus on Bangladesh-China bilateral trade is already visible and may seriously affect it in the long run, the Bangladesh Trade and Tariff Commission has said.

"Due to the virus outbreak both the domestic and export trade of China has come to a standstill. Its impact has already started impacting Bangladesh's trade," the commission said.

The commission forwarded on Sunday a preliminary report on coronavirus, or COVID-19, epidemic to the ministry of commerce where it also stated that Bangladesh's major export sectors have already been affected.

Commerce ministry officials said the report will be placed at a meeting at the prime minister's office (PMO) Tuesday with principal secretary Dr Ahmad Kaikaus in the chair.

The meeting will discuss about the possible way out relating to the crisis on goods export and import from China and neighbouring countries caused due to the coronavirus outbreak.

In the report, the commission said, nearly 60 per cent fabrics of woven sub-sector were being imported from China. "The negative impact of the coronavirus on this sector has already started becoming apparent."

It said some 15 to 20 per cent raw materials and 80 to 85 per cent dyeing chemicals and accessories of knitwear sector comes from China. "The supply chain of these items is already facing disruption."

The commission said some 60 to 65 per cent of country's total finished leather and leather goods is being exported to China. "The sector may incur loss worth Tk 30 billion due to the coronavirus outbreak."

The report said some 40 per cent raw material of garment accessories and packaging manufacturing industry worth $1.6 billion is being imported from China per annum. "Due to the supply chain disruptions the stakeholders fear a loss worth Tk 15 billion."

According to the report each month Bangladesh imports some 200 containers of cosmetics and toiletries worth Tk 750 million from China. Due to the virus outbreak import and shipment of the items remained suspended.

The report said some 80 to 85 per cent machinery and spare parts of electrical merchandise manufacturing industry was being imported from China. The commission is now calculating the possible loss from the shipment suspension due to the coronavirus epidemic.

Bangladeshi jute spinners export goods worth $5.32 billion annually to China which now remained suspended due to the spread of virus, the commission said.

The report said the annual import of raw materials of printing industry from China stands at $1.8 billion. "Due to the present shipment suspension, the loss may reach up to $3.6 billion.

Bangladesh annually imports 25 containers of medical instruments and hospital equipment from China. At the same time, some 95 per cent raw materials and ready products of eyewear industry also being imported from China which now remained suspended.

The report also said Bangladesh's computer and computer accessories sector is largely dependent on China. Due to the supply chain disruption prices of raw materials, equipments, and accessories in the local market have already started to go up.

"Meeting demand of these items would not be possible unless supply system becomes normal," the report said.

Some 80 per cent television sets, refrigerators, mobile phone sets, ovens, chargers and other electronics items comes from China. Due to the shipment suspension prices of the items in Bangladesh market already started rising, it said.

The commission said export of crab and eel fish from Bangladesh to China remained suspended since January 25. Unless the stockpiled items can be exported the financial loss may cross Tk 4.0 billion, it added.

The raw materials of plastic industry, its machineries and spare parts like injection moulding, printing, and extrusion machine parts are being imported from China. The sector is facing serous threat due to the supply chain disruption, the report mentioned.

A senior commerce ministry official told the FE the possible impact of coronavirus outbreak was yet to be fully calculated but the preliminary assumption shows a large affect on country's export-import trade and merchandise industry.

He said China is top sourcing partner for Bangladesh with annual import of $13.85 billion while export to the country is around $831 million. "Any long lasting supply chain disruption with China may have catastrophic impact on our economy," he said.

syful-islam@outlook.com

Share if you like