Expert opinion: China coronavirus may affect Ukrainian exports.

The expert warns a decline in imports from China will significantly affect Ukraine's electronics market.



Deputy Director of the Center for Economic Strategy Maria Repko says the further spread of the novel coronavirus in China may affect Ukrainian exports, especially those related to steelmaking.

Read alsoTwo Ukrainians with coronavirus on cruise ship in satisfactory condition – MFA

"Moody's [Investors Service] has published forecasts for the global economy amid a coronavirus outbreak, while prices of commodities, fuel, and iron ore may be affected first. Ukraine does not sell many goods to China, but if prices drop, revenue of ore exporters and steelmakers will decrease as well. They have already suffered from deteriorating market conditions in 2019," she said at a roundtable discussion on February 12.

Repko also gave an outlook for the largest Ukrainian export channels to China; they include shipments of iron ore and concentrates (account for 23% of the country's relevant exports) and those of gas turbines (60%). Moreover, the share of rapeseeds exports is 45%, that of maize is 14%, while shipments of wheat and soybeans to China account for almost 25%. Therefore, the said segments will instantly respond to the worsening economic situation.

What is more, the expert warns a decline in imports from China will significantly affect Ukraine's electronics market.

"Ukraine imports 94% of Chinese diodes and semiconductors, smartphones, and monitors. Chinese goods account for 50-90% of the electronics market, depending on a particular group of the commodities. Therefore, the effect will be tangible," she said.

At the same time, a decrease in Chinese imports of clothes and shoes to Ukraine could have a positive effect on domestic production, as Ukrainian manufacturers will be able to replace Chinese goods with those of Ukrainian origin.

Repko also added that the further spread of the coronavirus could affect financial markets, which are usually sensitive to such news.

"Analysts expect China's GDP to lose 1.5% of its growth rate. The markets are reacting nervously to this. There is no panic yet, but we observe a noticeable trend towards choosing quality when bonds from the United States, Germany, and the United Kingdom are bought first, while money is being withdrawn from developing countries, including Ukraine," the expert summed up.

Related news

NBU strengthens official forex rate to UAH 24.45 to dollar for Feb 24

The hryvnia became stronger for the second day in a row after it had gained three kopiykas in value against U.S. dollar.


Week's balance: Cabinet vows to pull labor market out of «shadows» , allocates UAH 4 bln in farmer support, while energy minister announces record cuts in gas tariff.

The Cabinet of Ministers launched a campaign to remove the labor market from the "shadow" and distributed UAH 4 billion in support of farmers, while Minister of Energy and Environment Oleksiy Orzhel announced a record reduction in gas tariffs – th...


Ukraine exports 16 mln tonnes of wheat over six months – expert.

In the first half of the 2019/2020 marketing year, Ukraine exported about 16 million tonnes of wheat, Director General of UkrAgroConsult consulting agency Serhiy Feofilov has stated.

1 5

Ukraine's National Bank exploring possibility of issuing e-hryvnia.

Some 80% of the world's central banks today are working on digital currency, the official says.

EBA opposes bill on annual increase in share of domestic raw materials in cognac production to 85% in 2027.

The European Business Association (EBA) has called on lawmakers to reject bill No. 2431 on the mandatory use of domestic raw materials in production of cognac in Ukraine with the annual growth of the share of domestic raw materials to 85% from Jan...


By continuing to browse World News (UAZMI), you acknowledge that you have read the Terms of Use and agree to the use of cookies