Incentives for coronavirus-affected sectors suggested
A government body has suggested providing special financial incentives to the coronavirus-affected sectors to help them offset the impacts.
Business Promotion Council (BPC) that operates under the Ministry of Commerce (MoC), after a meeting with the trade bodies representing the affected sectors, sent a set of recommendations to the parent ministry last week.
The deadly virus, originated in China late last year, has fast become a pandemic, disrupting businesses as well as halting usual activities of humankind in its trail.
Bangladesh announced on Sunday the detection of COVID-19 in three persons, further creating panic among local manufacturers and buyers as well.
Meanwhile, several Bangladeshi exporters reported that foreign buyers have started re-scheduling work orders by cutting down to some extent as the novel coronavirus continues to spread.
Swedish retailer H&M, one of the top apparel buyers of the world that makes a substantial purchase from Bangladesh, has cancelled factory visits by its officials after corona's exposure here.
The conglomerate outsources more than $3.0 billion annually from Bangladesh.
According to officials, the BPC had sought assessment reports from trade bodies to let the government know the extent of negative effect due to the virus outbreak.
The Bangladesh Frozen Foods Exporters Association in its letter said exports are facing disruptions due to the spread of this disease.
The sector leaders estimated the initial financial loss at Tk 400 million which, according to them, might increase further.
Bangladesh Tanners Association in its submission said sector members could not ship 150 containers of leather immediately after the virus spread.
This might cause a financial loss to the tune of Tk 2.40 billion to the tanners, it said. Shaheen Ahamed, chairman of the association, said the sector is not getting new work orders now.
If the situation continues, he fears, the loss may reach up to Tk 30 billion.
Bangladesh Plastic Goods Manufacturers and Exporters Association in a letter said the virus epidemic has already broken supply chain from China.
Raw materials, machinery and equipment have become dearer, it cited.
The sector was forced to reschedule its annual International Plastic Fair-2020 due to corona scare.
Bangladesh Live and Chilled Food Exporters Association said crab and eel exports to China, the main market of the items, have remained suspended since January 25.
Even many factories are set to face closure, thus putting the livelihood of thousands of people at risk due to the outbreak of the virus, it observed.
In a letter, Bangladesh Fruits, Vegetables and Allied Products Exporters Association said exports to Europe and the Middle East have declined for the same reason.
Earlier, Bangladesh Trade and Tariff Commission said nearly 60 per cent fabrics used by the woven sub-sector are imported from China, the epicentre of the pathogen.
Besides, 15 to 20 per cent raw materials and 80 to 85 per cent dying chemicals and accessories of the knitwear sector comes from China, it reported.
The commission said the negative impact of coronavirus on this sector has already started showing as supply chain is facing disruptions. After receiving reports from trade bodies, the BPC said various industrial sectors are facing severe challenges due to supply chain disruptions.
The sectors need immediate support from the government, it mentioned.
Leather sector needs special incentive, bank loans on easy terms and simple payment schedule for previous loans, it said.
Cash incentives for the sector can be enhanced to 20 per cent from the current 20 per cent which may help them restart business with renewed vigour.
The BPC also suggested providing assistance in building new markets for crab and eel.