As the Chinese government and the World Health Organization (WHO) try to contain the outbreak of the coronavirus, businesses need to be prepared for some disruption in international trade.
The first case of coronavirus was detected Dec. 31, and the source of the outbreak was identified the next day as a seafood market in Wuhan, Hubei Province. The virus is spread through close human contact, so governments and health organizations have been trying to limit exposure in part by restricting travel, even though the WHO recommends against travel bans.
More than 20,000 cases have been identified, all but a couple of hundred contained within mainland China. As of today, the virus has been blamed for 427 deaths.
At the website SupplyChainDive.com, writer Matt Leonard looks at the impact it is having on international trade. Wuhan is a major economic center with a population of 11 million.
“Transportation is shut down in and out of Wuhan and Hubei Province, and all terminals at The Port of Wuhan have ceased operations as the result of the quarantine the Chinese government has instated on the region,” Leonard writes, citing Mirko Woitzik and Tim Yu, who work in risk intelligence for Resilience360.
Additionally, shipments being diverted from Port Wuhan are causing congestion at other ports along the Yangtze River and causing empty shipping containers to “pile up” in China. Some companies are shifting production out of the affected area, while others are working with the Chinese government to get people back to work and restart production.
One estimate has the outbreak reducing China’s estimated increase in gross domestic product for 2020 by as much as 1%.