HQTS Latest Supply Chain & Trade Updates across Asia – Report #7

With a wide range of service locations across Asia, HQTS has collected important supply chain and trade related information to help you fully understand the current situation affecting your business.

 

China

China is gradually recovering from lockdowns and travel restrictions that have been imposed since the beginning of February 2020. China’s manufacturing is back to full capacity and the majority of factories in larger cities across China have been functioning as usual since April 2020. Staffing rates, production capabilities and internal logistics have finally returned to how they were functioning before COVID-19.

The International Monetary Fund (IMF) has forecast China’s economic growth rate of 1.2% in 2020, which is going to be the lowest GDP growth rate in China since 1976, imposing a severe impact on the manufacturing sector.

 

Bangladesh

Restriction policies on traveling, logistics and business operation:

Bangladesh extended its nationwide lockdown until May 30th. Restrictions are imposed strictly on transportation and no vehicles will be allowed on roads except for emergency needs.

Financial and trading policies:

Referring to the country’s economic conditions, readymade garments, pharmaceutical and export-oriented industries are kept open, ensuring social distancing and health guidelines are being correctly followed. According to Bangladeshi garment manufacturer associations, about half of the 4000 garment factories have reopened, with orders for June down 45% from the previous year.

 

India

Restriction policies on traveling, logistics and business operation:

India has extended its lockdown for another two weeks until May 31st, as it attempts to curb the spread of coronavirus. After a hiatus of two months, India opened up its domestic flight operations from May 25th. For the first time since the lockdown was announced, private cars and buses can now operate across cities and town, as well as crossing state borders if they have permission.

Financial and trading policies:

Indian government had already relaxed the rules to allow agriculture and related businesses to reopen and operate. Self-employed workers including plumbers, electricians and carpenters are allowed to start working again. However, the relaxations were allowed only in orange or green zones, which do not have a high number of COVID-19 cases. Tight restrictions still continue in red hotspots zones.

 

Vietnam

Restriction policies on traveling, logistics and business operation:

Vietnam’s Immigration Department has announced that it will extend temporary residence permits for those that have entered before March 1st until the end of June 30th. Foreigners that have entered on visa-free policies, e-visas or tourist visas since March 1st will also be entitled to the same automatic extension program until June 30th.

Financial and trading policies:

The International Monetary Fund (IMF) has stated that Vietnam’s economic growth may slow down to 2.7% this year due to the pandemic but may pick up to 7% in 2021. Vietnam has approved the reopening of sub-border gates and border crossings in the Lang Son and Quang Ninh provinces, connecting with China to help trade between the two countries.

 

Malaysia

Restriction policies on traveling, logistics and business operation:

Malaysia extends its relaxed lockdown until June 9th. The restrictions in place include school closures across the country and the continued shut down of Malaysia’s borders.

Financial and trading policies:

Malaysia allowed nearly all sectors to reopen on May 4th as each day of the lockdown had cost 2.4 billion ringgits ($550 million) of losses to the economy.
The government has taken a strong stance against migrant workers and undocumented people, with enhanced lockdowns on buildings homes to mostly foreigners. The unemployment rate jumped 0.6% month-on-month in March, resulting in a ten-year high of 3.9%.

 

The Philippines

Restriction policies on traveling, logistics and business operation:

The coronavirus lockdown of Metro Manila may be eased further to limit quarantine restrictions to high-risk parts of the metropolis starting June 1st as the government allows more movement and business reopening’s to help reboot the economy.

Financial and trading policies:

Manila, Laguna province and Cebu will remain under lockdown, but nationwide restrictions will be modified in a three-tiered plan to ease restrictions in many areas, helping to restart the Philippine economy. The government has also allowed public transport in places outside Metro Manila, where the lockdown has been downgraded to a “general community quarantine”. The Labor Ministry estimates that as many as five million Filipinos will lose their jobs by the year’s end and economic managers are forecasting a recession that may linger till next year.

 

Singapore

Restriction policies on traveling, logistics and business operation:

Singapore will lift the coronavirus lockdown in three phases starting on June 2nd, according to the country’s Health Ministry.

Financial and trading policies:

The country is preparing for the resumption of critical and low-risk economic activities. During the second phase, more social activities should be allowed to resume, and retail shops and sports facilities may reopen. In the third phase, all restrictions will eventually be eased but with strict guidelines and it will also reopen its borders in the third phase. According to the Ministry of Trade and Industry, Singapore’s economy is expected to shrink between 4.0% and 7.0% this year, the third official downgrade in economic forecasts.

 

Indonesia

Restriction policies on traveling, logistics and business operation:

The Indonesian government is planning a five-phase return, post COVID-19, starting with freeing up transport services on June 1st and opening up all economic activities by the end of July.

Financial and trading policies:

The first phase of the government plan will see the resumption of air, rail and bus services, which were cancelled last month. Phase two of the government’s plan envisages the opening of malls and markets on June 8th, followed by a third phase on June 15th that allows for the limited re-opening of schools. Phase four, is timed for July 6th, proposes the gradual return to business of restaurants, cafes, bars and gyms.

The government will extend the state budget deficit beyond the mandated 3% of gross domestic product (GDP) in disbursing an initial US$24.6 billion for COVID-19 relief measures. Analysts are now predicting full year GDP growth of the country as low as 1.3%.

 

Thailand

Restriction policies on traveling, logistics and business operation:

Although the COVID-19 situation in Thailand has shown positive developments, the Centre for Covid-19 Situation Administration (CCSA) adopted the National Security Council’s proposal of extending the state of emergency until June 30th.

Financial and trading policies:

A shorter curfew period, inter-provincial travel and a trial of school reopening’s with a reduced ratio of teachers per schoolchildren will be considered for the next stage of lockdown easing as coronavirus infections continue to fall.

 

Pakistan

Restriction policies on traveling, logistics, and business operations

Pakistan is planning to reimpose strict lockdown after the violations of Govt. advisory on Eid. Pakistan’s COVID-19 cases have increased to 57,128 with 1,182 deaths. Pakistan Supreme Court has ordered shopping malls and markets to remain open throughout the week considering the impact on small vendors and shopkeepers, with less movements on public transport, which can be seen with domestic flight operations.

Financial and trading policies

Pakistan has reopened its major border crossings with Afghanistan for trade and movement and have also resumed trade activities with Iran at borders amid the pandemic. Pakistan government announced a relief package of Rs 1200 billion ($5.5 billion) and have also obtained from IMF a loan of $1.4 billion under a Rapid Financing Instrument (RFI) for cash transfers to low-income families and electricity payment relief. But the package did little to handle the underlying weakness of the economy, including the potential for diminished exports, remittances and high indebtedness.

Tradeshow and exhibition postponed or suspended in Asia

  • Food and Beverage Innovation Forum 2020, April 15-17, the show’s organisers say they will postpone the event, scheduled to be held in Hangzhou, till later in the year.
  • Coaltrans China 2020, April 20-22: One of the largest coal industries gathering was postponed until further notice.
  • Asian Business Aviation Conference & Exhibition, April 21-23: The show’s organisers, the National Business Aviation Association, said they would cancel this year’s show in Shanghai given health concerns and other challenges its participants faced.
  • SEMICON/FPD China 2020, March 18-30: The annual trade conference for the global chip industry in China was postponed until further notice.

About HQTS

With over 25 years of experience in quality assurance, HQTS is ready to help your business build meaningful and robust supplier relationships across Asia. Our many service locations are prepared to be your one-stop-shop for your inspection needs, including factory audits, production monitoring, pre-shipment and sorting inspections, and everything in between. This will allow you to know exactly what’s happening on the ground and keep close tabs on your suppliers. Contact us today to find out how we can help you navigate current quality control challenges.

What kind of information do you want us to provide?