Entrepreneurs in the export-oriented apparel sector are concerned about the timely arrival of raw materials from China
The overall export-import activities of the country may take a hit if the coronavirus situation keeps deteriorating in China.
Entrepreneurs in the export-oriented apparel sector are concerned about the timely arrival of raw materials from China.
Exporters of woven fabrics are particularly concerned as a sizeable quantity of woven fabrics is imported from China.
“Export-import activities with China have remained suspended for the last two weeks due to holiday. The situation will worsen further if the holiday is extended further due to outbreak of the fatal viral disease,” said Quazi Mahmud Imam, joint secretary of Chittagong Customs C&F Agents Association.
Speaking to Dhaka Tribune, BGMEA director from Chittagong region Mohammed Musa said they were concerned as the delayed delivery of raw materials would have an adverse impact on production.
“We may face a great trouble if the holiday in China was extended further, which will delay the shipment. We may be forced to go for air shipment, in which case the buyers may demand discount. In worst cases, the buyers may even cancel orders,” said the BGMEA director.
Another BGMEA director from Chittagong region Anjan Shekhar Das said that no fabrics or accessories were on board from China in the last seven to eight days.
“The delayed delivery of raw materials would lead to longer lead time. Initially, the buyers will demand air shipment. We will be hard put as the air freight charge is prepaid,” said the apparel exporter.
In apparel industry, lead-time is the total amount of time required for completing a product beginning from the date of receiving the order to the shipment of the goods to customer.
“The apparel exporters will face a great problem if they do not get raw materials in time. Any disruption in the supply chain of raw materials will create manifold problems. It will be very difficult to procure raw materials from other sources. We hoped that the situation in China would normalize shortly,” said AM Mahbub Chowdhury, senior vice president of Chittagong Metropolitan Chamber of Commerce and Industry and director of the BGMEA.
According to China Briefing, China’s State Council announced on January 27 that the Lunar New Year holiday was extended to February 2 across the country; the holiday week was originally from January 24 to January 30.
Meanwhile, the holiday has been extended to February 9 in many provinces of China amid the outbreak of coronavirus.
Of them, Hubei Province announced that enterprises in the province will remain closed till February 13. Gunagdong Province announced that it will delay resumption of work and school after February 9 and February 17-24, respectively.
According to the BGMEA, some 300 apparel factories are now functioning in Chittagong.
Shah Md Sultan Uddin Iqbal, senior vice president of Bangladesh China Chamber of Commerce and Industry, however, claimed that it would have some short-term impact on the import-export activities and development projects of the country due to the coronavirus outbreak in China.