Local importers are following stringent controls, stipulated guidelines in handling imports from China as a precaution to prevent the coronavirus from spreading into the country. A senior official attached to the Import Section at the Ceylon Chamber of Commerce said that everyone is concerned about the effects of the deadly Coronavirus , originating in China.
“As far as I know, there have not been any fresh food imports from the virus hit areas of China and they are closely working with the quarantine office in Colombo and importers are requested to follow stipulated guidelines to prevent the effects of the Coronavirus outbreak.
We’re a collection of importers and we have advised those who import processed food from china to go slow until the situation is brought under control.” he said. Sri Lanka mostly imports processed food from China.
Meanwhile, Moody’s Analytics issuing a statement said that Reduction of income, even if temporary, makes the high debt load in the country more untenable.
According to Moody’s Analytics recent reports, economic impacts of the Coronavirus will be felt elsewhere in Asia and in the U.S., but in no other country so many industries will combine to create as deep an impact as there will be in China.
The most direct impact caused by the quarantines of large population centers in China is the loss of demand for transportation, the more so as this is the peak travel season for Lunar New Year celebrations. The Ministry of Transport reports that the number of holiday trips totals just 1.3 billion so far, well below the expected 3 billion. Much of this will be made up eventually as people return from their hometowns, but the travel interruption could extend well beyond the end of February and perhaps into the second quarter, and cancelled overseas trips may not be rebooked until next year’s holiday season.
The transport, warehouse industry accounts for 4.6% of the economy. According to Moody’s Analytics, thus the five sectors such as transport, entertainment, wholesale, retail trade, commercial real estate and manufacturing are at risk from the Coronavirus and the resulting quarantines in China create a measurable but modest impact on the economy.
A quarantine through much of this quarter will easily amount to a 1% quarterly loss of GDP in this year’s first quarter and a loss of at least 0.3% for the year, with greater impact possible due to multiplier effects and deterioration of credit quality.
These five industries combined would reduce first-quarter 2020 GDP by 1.2%, or around 0.3% for the entire year. But this does not include multiplier effects within other industries, a longer-term loss of confidence, or the longer-term impact on credit availability and credit quality. (IH)
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