Businesses feel shaky as China virus spirals
Skip to main content
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
The Business Standard
THURSDAY, MAY 26, 2022
THURSDAY, MAY 26, 2022
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Splash
  • Features
  • Videos
  • Long Read
  • Games
  • Epaper
  • More
    • COVID-19
    • Bangladesh
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Subscribe
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
Businesses feel shaky as China virus spirals

Economy

Sajjadur Rahman
03 February, 2020, 09:05 am
Last modified: 05 February, 2020, 05:13 pm

Related News

  • Elton John has COVID, postpones U.S. tour dates
  • Tushar Khan in ICU
  • Covid-19: Bangladesh rolls out booster dose in Dhaka
  • Omicron cases doubling in 1.5 to 3 days in areas with local spread - WHO
  • Health costs during pandemic pushed over half a billion people into poverty

Businesses feel shaky as China virus spirals

Many businesses mull alternative sources of raw materials

Sajjadur Rahman
03 February, 2020, 09:05 am
Last modified: 05 February, 2020, 05:13 pm

The impact of deadly coronavirus on the Bangladesh economy seems to be severe as garment exporters and other businesses who rely heavily on China for sourcing their raw materials and machinery worry that their supply chains will be disrupted if the situation lingers any longer.

Their concerns are not limited only with the imports, but also with exports as Bangladesh shipped around $1 billion worth of goods to China, the world's second largest economy, last fiscal year.

"China is a major source of raw materials for us. We are too worried," said Anwar-ul Alam Chowdhury Parvez, former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

He has a genuine cause for worry as the country's exports are on a decline so far this fiscal year. Government data shows Bangladesh's overall exports went down by nearly 6 percent to $19.30 billion in July-

December period of this fiscal year compared to the same time period a year ago.

"It is a big threat for us as we have hardly any alternative sourcing market other than China," said Parvez, also the president of Bangladesh Chamber of Industries.

According to the central bank data, Bangladesh's total merchandise import payments were $56 billion in 2018-19, of which more than one-fourth was from China. Nearly 70 percent of the imports from China were textile raw materials, machinery, boilers and electrical and mechanical appliances.

But all this vital bilateral trade is now on the verge of collapse after the deadly outbreak of coronavirus in Wuhan of China on December 31, 2019. The disease, which has spread to 27 countries, has killed more than 300 people so far.

The outbreak has forced many countries to put restrictions on their nationals' travel to China. Economic activities and industrial production in China have gone down significantly. So, shipments of goods to and from China remain almost suspended.

KM Rezaul Hasanat, chairman and CEO of Viyellatex Group, said China has already extended its New Year vacation to February 9 from previous January 28 due to the outbreak of coronavirus.

"Now all the activities in factories are suspended and we don't know whether this holiday will be further extended," said Hasanat.

According to a Bloomberg report, due to a government-mandated extension of the Lunar New Year holiday, provinces generating at least two-thirds of economic output will be shuttered through next week, including Shanghai and key eastern manufacturing hubs.

Mizanur Rahman, chairman of Meghna Group, the biggest bicycle exporter of Bangladesh is very worried with the situation as the raw materials for his factory will run out in three weeks unless the situation improves.

"Our export may collapse if the situation does not improve in a month," Mizan told The Business Standard.

But businesses are not sitting idle as they are looking for alternative options for sourcing their goods.

Mostofa Kamal, chairman of Meghna Group of Industries, said he can run his factories for a maximum of two months with the stock of raw materials. He has over three dozen companies, ranging from essential commodities to chemicals, shipping and many others.

Kamal imports machinery, steel and chemicals from China.

"If the situation in China doesn't improve in a month, we will explore other sources," he said.

Like Kamal, MA Jabbar, managing director of fast-growing DBL Group, an exporter of half a billion dollars of garments products globally, is trying to find out alternative markets to keep his supply chain intact.

"We have to explore other countries for buying machinery and raw materials, no matter how expensive those are," said Jabbar.

Prof Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue, said if the situation escalates, spreads and prolongs, then it is a matter of concern for many countries, including Bangladesh.

Infograph / Top News

corona virus

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • Tax amnesty, relaxed remittance rules to bring back laundered money: Kamal
    Tax amnesty, relaxed remittance rules to bring back laundered money: Kamal
  • Azam Nazeer Tarar presents the Election Amendment Bill in the National Assembly on Thursday. — Photo Courtesy National Assembly of Pakistan/Twitter
    Pakistan NA passes bill abolishing use of EVMs in election
  • Soaring prices changing the way rural people live
    Soaring prices changing the way rural people live

MOST VIEWED

  • Representational image. Picture: Pixabay
    Govt raises regulatory duty to discourage imports of 130 products
  • Representational Image. Photo: Mumit M/TBS
    Govt to list products to suspend imports amid dollar crisis
  • BPC hunts for dollar to import fuel oil
    BPC hunts for dollar to import fuel oil
  • British International Investment (BII) CEO Nick O’Donohoe. Illustration: TBS
    BII to invest $450m in Bangladesh in 5 years
  • Bangladesh may face debt distress from 2032: Economic Association  
    Bangladesh may face debt distress from 2032: Economic Association  
  • Inflation jumps to 6.29% in April
    Inflation jumps to 6.29% in April

Related News

  • Elton John has COVID, postpones U.S. tour dates
  • Tushar Khan in ICU
  • Covid-19: Bangladesh rolls out booster dose in Dhaka
  • Omicron cases doubling in 1.5 to 3 days in areas with local spread - WHO
  • Health costs during pandemic pushed over half a billion people into poverty

Features

Photo caption: Business models are already being hit by climate risk. It is the function of regulators to force banks to pay attention to the future risks to businesses. Photo: Bloomberg

HSBC and its discordant climate songbook

2h | Panorama
Illustration: TBS

Should Belayets be allowed to return to school at 55?

6h | Pursuit
Impact Hub Dhaka is designed to cater to connectivity, offering lots of communal areas where you can chat over coffee, watch a webinar as a group or even host events. Photo: Courtesy

Inside Impact Hub: The surprising benefits of working in a co-working space

7h | Pursuit
Pacific Jeans uses sustainable technology in washing and finishing, and now has the facility to wash with zero water. Photo: Courtesy

How big dreams and smart investment made Pacific Jeans a denim exporting giant 

8h | Panorama

More Videos from TBS

5 latest exciting movies

5 latest exciting movies

37m | Videos
Why is Thanda Garam's juice so popular?

Why is Thanda Garam's juice so popular?

6h | Videos
Tea tales at TSC

Tea tales at TSC

7h | Videos
What journalism students want to know

What journalism students want to know

8h | Videos

Most Read

1
Tk100 for bike, Tk2,400 for bus to cross Padma Bridge
Bangladesh

Tk100 for bike, Tk2,400 for bus to cross Padma Bridge

2
Bangladesh at risk of losing ownership of Banglar Samriddhi
Bangladesh

Bangladesh at risk of losing ownership of Banglar Samriddhi

3
BSEC launches probe against Abul Khayer Hero and allies
Stocks

BSEC launches probe against Abul Khayer Hero and allies

4
Photo: Courtesy
Panorama

Misfit Technologies: A Singaporean startup rooted firmly in Bangladesh

5
Illustration: TBS
Banking

Let taka slide

6
Photo: Collected
Industry

Spanish recycled cotton producer opens new facility in Bangladesh

The Business Standard
Top
  • Home
  • Entertainment
  • Sports
  • About Us
  • Bangladesh
  • International
  • Privacy Policy
  • Comment Policy
  • Contact Us
  • Economy
  • Sitemap
  • RSS

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - oped.tbs@gmail.com

For advertisement- sales@tbsnews.net

Copyright © 2022 THE BUSINESS STANDARD All rights reserved. Technical Partner: RSI Lab