Commerce minister Tipu Munshi on Sunday expressed his apprehension that the country’s exports might plunge if there was a widespread outbreak of coronavirus in the countries where Bangladesh sold its products.
‘Our import from China is being hindered but there is an apprehension, if the economic activities of the countries, who buy our products, become slow due to the widespread outbreak of coronavirus, Bangladesh’s sales will plunged,’ the minister told reporters following an event organised by the International Chamber of Commerce, Bangladesh at the Hotel Intercontinental in the capital.
It is an apprehension but the situation is not such that buyers decreased their orders from Bangladesh,’ he said.
It is too early to predict the damages and the government is observing the situation, the commerce minister said.
In Bangladesh, three people were identified infected with COVID-19 later on the day.
Tipu Munshi said that the government was trying to assess the damages Bangladesh would face due to the coronavirus outbreak.
Replying to a question, the commerce minister said, ‘It is not right time to take any decision on support package for the businesses rather we have to wait more to assess the real damages.’
He said that Bangladesh faced trouble due to the epidemic as more than 60 per cent of raw materials came from China.
‘But it is good news that the rate of coronavirus infection has started decreasing in China and workers have started joining the work in factories. Hopefully the situation will improve within a short time,’ Tipu Munshi said.
In December last year the outbreak of the epidemic began in China, the single largest supplier of industrial raw materials for readymade garment and other sectors of Bangladesh.
Later, the virus spread to many countries in Europe, America and Asia, posing potential threat to the normalcy in global economic activities.
Earlier, exporters and experts in Bangladesh apprehended that it could bring a huge shock to the export earnings of Bangladesh if the virus became a global pandemic and was prolonged.
The cases of coronavirus infection are increasing in Italy, the US, Germany, France, Japan, Spain, the Netherlands and some other countries.
‘It’s a matter of concern for Bangladesh as 63 per cent of country’s total export earnings come from European countries,’ Selim Raihan, executive director of South Asian Network on Economic Modeling, told New Age on Sunday.
He said that supply chain disruption in both the backward and forward linage might take place due to the outbreak of coronavirus.
The International Monetary Fund predicted that the global economic growth would come down to half from the projection this year due to the coronavirus outbreak.
Selim said that Bangladesh’s export earnings witnessed nearly 5 per cent negative growth in eight months of the current financial year 2019-20 and the earnings might decrease more in the coming months for the outbreak.
According to the Export Promotion Bureau data, Bangladesh’s export earnings in the eight months of FY 2019-20 declined by 4.79 per cent to $26.24 billion from $27.56 billion in the same period of last fiscal year.
Earlier, Centre for Policy Dialogue distinguished fellow Mustafizur Rahman told New Age that the World Bank and other international agencies revised downward the global economic growth projection for the current fiscal year.
‘It is clear that the global economy is heading towards a slowdown, though not recession, as trillions of dollar just wiped out from global stock markets on fear of further spread of the virus.’
It would affect global economies, particularly export-oriented countries like Bangladesh, if the COVID-19 virus further spreads and prolongs, he said.
But, the good news is that the spread of the virus has reduced in China, the origin of the virus outbreak, said Mustafizur.
Actual impact on Bangladesh export is yet to be assessed as it will depend on the developments surrounding the outbreak, he said.
Policy Research Institute executive director Ahsan H Mansur said that it would affect Bangladesh’s export and the economy if the virus became a global pandemic.
But, the most devastating impact Bangladesh would face if the virus spread to Bangladesh as global buyers may be fearful to stay in the country, he said.
Globally all are in fear of a pandemic and afraid of huge shock to trade and economy due to new suspects in new countries, he said.
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