China is more or less closed for business because the coronavirus and that’s not good. The world depends on China for manufacturing at an insane volume. 80% of the world goods trade by volume is carried by sea and China is home to 7 of the world’s 10 busiest container ports, according to the UN Conference on Trade and Development. And nearby Singapore and South Korea each have a mega port too. Not only does this directly affects trade but it indirectly affects shipping globally as it disrupts as the hub of manufacturing the transport and disbursement of shipping containers. The global supply chains are all messed up. This affects many industries that are dependent on containerized goods transport.
Myanmar has closed it’s northern border to China as is the case with every country and territory that borders China. Currently there are no goods being shipped across the border from China because of the fear of the coronavirus being spread. Farmers are seeing their produce sit and rott at the border. There is little the Myanmar government can do for them. China over the last decade or so has increased it’s purchasing of agriculture products from Myanmar. More than half of Myanmar’s agriculture products are shipped to China every year.
Agriculture is not all. Popular online retailers that saw a growing boom the last couple years are struggling as most of their products come from nearby China. Several companies that are heavily dependent on Chinese goods cross border are thinking of different strategies to sell to their customers. Tourism packages from China have been suspended until further notice, which is a big blow. The tourism sector had just bounced back this year as Myanmar tried to repair it’s image from the Rohingya crisis.
It’s hard to tell right now what the economics affects of the coronavirus will have on Myanmar. Myanmar needs growth badly and has projected more than 6% growth for 2020. If the economy is stalled it could affect the elections coming in November and the country could digress. But for now it’s a wait and see. To see if China can get the virus under control in the next few week and Myanmar can feel confident to open it’s borders again.
Written By- Mr. Ryan Russell(CEO of Myanmar Business Answers)