World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus warned on Monday that as the number of confirmed cases of new coronary pneumonia rises sharply around the world, especially in Africa and India, where the epidemic worsens in densely populated but relatively scarce medical resources, the worst situation in the world is The moment is “coming soon”.
Recently, due to the rapid changes in the epidemic situation in Europe and the United States, consumption expectations have dropped significantly. Foreign trade companies have begun to face the situation of foreign buyers suspending or canceling orders. The demand side has triggered a cold wave in exports. The economic recession and consumer demand caused by the severe epidemic in major exporting countries have reduce. The raging overseas epidemic is not only lowering expectations for global economic growth, but the contraction of external demand is also continuing to have a negative impact on my country’s exports. Many countries with already fragile economies have suffered business disruptions due to the epidemic, economic collapse and crazy currency depreciation.
Among them, since March, the negative impact caused by the new crown epidemic has gradually emerged. Affected by the epidemic, buyers are short of funds and unable to pay on time or face bankruptcy, or may be affected by the epidemic. Due to the impact of epidemic prevention and control measures on the inability to pick up goods on time, the number of reported loss cases in March increased by approximately 74% year-on-year, and the amount of reported losses increased by nearly 30% year-on-year. The overseas credit risks faced by export companies have increased significantly.
In addition, so far this year:
The Russian ruble has depreciated by 19% against the US dollar;
The Australian dollar has depreciated by 10% against the US dollar;
The pound sterling It depreciated by 7% against the US dollar;
The Turkish lira depreciated by 15% against the US dollar;
The Indian rupee depreciated by 7% against the US dollar;
The Thai baht depreciated by 8% against the US dollar;
The Mexican peso depreciated by 22% against the US dollar;
The South African rand depreciated by 26% against the US dollar;
The Brazilian real depreciated by 24% against the US dollar;
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The Argentine peso depreciated 9% against the US dollar.
★Which countries (regions) are at higher risk? ★
According to Zhejiang Credit Insurance Company’s summary of the export credit risk situation of Zhejiang Province in the first quarter:
Risk Warning
Asia Region: Report The number of damage cases ranked first among continents, with a year-on-year increase of approximately 22%. The top ten in terms of number of reported losses in Asia: India, Bangladesh, Hong Kong, Pakistan, United Arab Emirates, South Korea, Indonesia, Vietnam, Lebanon, Jordan; the top ten in terms of amount of reported losses in Asia: India, Bangladesh, South Korea, Malaysia, Hong Kong, Saudi Arabia, Vietnam , Israel, the United Arab Emirates and Pakistan.
Europe: The number of reported damage cases and the amount of reported losses both rank second in the continent. , the number of reported damage cases increased by approximately 12% year-on-year. The top ten countries in terms of number of reported losses in Europe: Italy, the United Kingdom, Russia, Germany, Poland, Turkey, France, Spain, the Netherlands, and Bulgaria; the top ten companies in Europe in terms of amount of reported losses: Italy, the United Kingdom, Russia, Germany, the Netherlands, Turkey, France, and Poland , Denmark and Ukraine.
Africa: The region’s overall accident rate ranks first among continents, much higher than the global average, and both the number of reported loss cases and the amount of reported losses have increased significantly year-on-year. Africa is more dangerous: Egypt, Nigeria, South Africa, Morocco, Algeria, and Ghana; both the number of reported damage cases and the amount of reported damage are at the forefront of the African region, and both have increased significantly compared with the same period last year.
Latin America: Top five: Brazil, Mexico, Colombia, Ecuador, Bolivia; the overall accident rate in Latin America is second only to Africa, higher than the global average, and the number of reported loss cases is higher than the same period last year Big increase.
North America: The amount of reported losses jumped to the top among continents, with a year-on-year increase of 26%, and the number of reported loss cases increased by 10% year-on-year. The risks in the United States and Canada have increased significantly;
Oceania: It is not much better, with the amount of reported losses increasing by about 1.2 times year-on-year. Reported losses are concentrated in Australia
Foreign trade companies need special attention. Affected by the impact of the epidemic and control measures, logistics and transportation are difficult, retail consumption has declined, liquidity pressure has increased, and the risk of buyer rejection and buyer bankruptcy has increased. Overall, Look, overseas buyers’ ability and willingness to pay have declined, and companies are facing increased risks in foreign exchange collection.
Argentina: The first country to be “collapsed” by the epidemic
As the global COVID-19 epidemic spreads, the epidemic prevention measures adopted by Argentina have made domestic The economy has come to a near standstill. The “universal quarantine” order that has been in place for nearly a month has been extended again, and all shops except supermarkets and pharmacies are closed. Completely close land, sea and air borders and cancel all international and domestic flights.
Experts believe that under the “shock-style” policy to fight the new crown epidemic that sacrifices economic development, a series of problems such as employment, exports, and debt in Argentina have already Gradually, the prospects for economic development are worrying.
According to Xinhua News Agency, the Argentine government announced on April 6 that due to the impact of the COVID-19 epidemic on the economy and society, it has decided to postpone the repayment of public debt totaling approximately US$10 billion until 2021. Data released by Argentina’s National Institute of Statistics and Census show that as of the end of 2019, Argentina’s foreign debt reached US$277.648 billion.
According to Reuters, on April 19, local time, Argentine Economy Minister Guzman said in an interview with the media that Argentina was in a state of “de facto default” and was currently unable to repay its debts, so it proposed a comprehensive debt Reorganization.
International currencies��, it has depreciated by 11.2% in 2020.
Chile: Launching the second phase of the emergency economic plan
Chile became the third Latin American country, after Brazil and Peru, with a cumulative number of confirmed cases exceeding 1 Thousands of countries.
President Piñera of Chile delivered a speech at the Presidential Palace. He said that he would launch the second phase of the emergency economic plan, which aims to protect self-employed, micro and micro businesses. , small and medium-sized companies.
For example, the government will set up a special fund of US$2 billion to provide more assistance to needy families and help them create more jobs; the state will provide loans totaling up to US$24 billion to small, medium and micro enterprises to help them survive. survive the crisis.
Risk Warning
The economic situation of the export destination country is an important indicator of whether its orders can be fulfilled normally and whether the payment for the goods will be in arrears. It is recommended that export enterprises comprehensively sort out and evaluate orders on hand, communicate with buyers in a timely manner, and negotiate with buyers in a timely manner for orders that may be suspended or canceled by customers to reduce export risks.
Beware of buyer’s bankruptcy risk
Affected by the continuous spread of the epidemic, the risk of overseas buyer’s bankruptcy has increased significantly. Take the retail industry as an example. Recently, there have been frequent reports that large foreign retail companies are facing bankruptcy. At the same time, considering the sharp decline in cash flow caused by store closures, the pressure on existing debt burdens, and the increased uncertainty in future operations, it has been Rating agencies have begun to downgrade the credit ratings of many European and American physical retailers, and the risk of buyer bankruptcy in the retail industry will continue to increase in the future.
Continue to pay attention to exchange rate changes in the buyer’s market
Affected by factors such as the continued spread of the new coronavirus pneumonia epidemic, the exchange rates of many countries’ local currencies have recently fallen sharply. When a country’s local currency depreciates significantly, import costs will be raised, and some importers may choose to abandon goods, refuse to accept goods, delay payment, or even not pay in order to avoid losses. Therefore, paying attention to exchange rate changes in the buyer’s market will help export companies grasp market changes in advance and reduce risks reasonably.
Pay attention to countries (regions) that have declared a state of emergency or taken
relevant control measures due to epidemic prevention
Recently declared a state of emergency or taken measures due to epidemic prevention The number of countries (regions) with relevant control measures is still rising. Countries are also taking unprecedented traffic restrictions. International logistics is facing numerous obstacles and commodity transportation is threatened. For orders placed by buyers in areas with severe epidemics, it is recommended that companies maintain communication before shipment and pay attention to local traffic control conditions to prevent being unable to pick up the goods.
After shipment, pay attention to the transportation status of the goods, allow sufficient time and pay attention to additional costs. More importantly, you must always pay attention to the relevant policies of the transit/destination country to avoid the risk of goods being expropriated or detained by the transit/destination country. For countries (regions) that are already at high risk due to severe epidemics, it is recommended that export companies must be more cautious when accepting new customers and new orders to ensure the safety of payment. </p
