It is no news that China is one of Nigeria’s major trade partners. What is news, however, is the fact that the prices of most products Nigeria imports from China have risen exponentially over the past couple of weeks. Coronavirus has been blamed for this situation.
Let’s break down the situation
The Coronavirus outbreak in China, which is the world’s second-largest economy by GDP, took everyone by surprise. So far, about 77, 150 cases of infection have been confirmed in the country, with 2,592 reported deaths. The disease has also spread beyond China to other Asian countries, countries in the Middle East, Europe, and even North Africa. Many now fear this might soon become a pandemic.
Asides the infections and the deaths, another thing that has left many people worried about the Coronavirus outbreak is the negative economic impacts it has wrought on China and elsewhere.
As Nairametrics reported earlier this month, the virus is partly responsible for pushing oil prices below the $57 per barrel benchmark on which Nigeria based its ambitious N10.6 trillion 2020 budget. This is because many Chinese factories have been shut down for weeks, thereby cutting down on the country’s energy demands.
Now, an inactive Chinese economy means that fewer products are being produced. And because the country cannot produce as many goods as it used to, it also cannot export as much as it used to. This, of course, has direct impacts on countries like Nigeria that depend heavily on Chinese exports.
Prices of goods are soaring
It was reported that some car spare part and battery dealers all of whom confirmed that the prices of the products have gone up. The reason is that these products are scarce in the market. The dealers are scared to visit China out of fear for the Coronavirus.
In the meantime, importers who already have goods in stock are beginning to hoard because they simply do not know when they will get the next shipment from China. An auto spare parts dealer identified as Chukwuebuka Maduabuchi said:
“It is very correct that the prices of Chinese products in the market is going high. The reason is that most of us importers have not gone to the market since this year. We did not anticipate that there would be an outbreak of a deadly disease in China early in the year. So, if you go round the market, the warehouses are becoming empty by the day. There is even panic buying of spare parts because we don’t know when this would come to an end.”
Chukwuebuka further added that unless a cure ends the epidemic soon, Nigeria may soon find itself in a serious problem. But while this is a legitimate worry, it is important to add that the country could always shift focus to another trade partner, or better still start thinking long and hard about producing its own products.
After all, as Chikezie Uwalaka noted, this might as well be a blessing in disguise for Nigeria.
“For me, the Coronavirus could be a blessing in disguise. It could be an opportunity for us to start thinking inwards. If the Coronavirus continues, it would hurt Nigeria`s economy.”