Coronavirus: China, Japan, South Korea supply chains under threat from ‘second wave’ of disruptions

The three Asian countries contribute around 24 per cent of the entire world economy, but have been hit hard by the coronavirus outbreak

China was attempting to boost trade and investment with Japan and South Korea to offset risks of decoupling from the United States

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Japan was China’s fourth largest trade partner in 2019, behind the European Union, the Asean bloc and the United States, with annual bilateral imports and exports valued at US$315.03 billion, with South Korea sixth at US$284.58 billion, according to Chinese customs data. Photo: EPA

Published: 9:15pm, 27 Feb 2020Updated: 9:48pm, 28 Feb 2020

China, Japan and South Korea are at risk of a second wave of disruptions to their supply chains due to the ongoing impact of the coronavirus epidemic, which risks already slowing global trade, analysts warned.

The three Asian countries contribute around 24 per cent of the entire world economy with a combined yearly trading volume of over US$720 billion, forming one of the most integrated international economic blocs in the world.

The three countries, though, have been hit hard by the coronavirus outbreak with over 1,500 confirmed cases in South Korea and over 180 domestic cases in Japan in addition to over 700 cases on the Diamond Princess cruise ship.

The coronavirus has grounded flights and restricted the flow of people between the three countries, while also disrupting integrated industrial supply chains across the region, with the electronics and automotive industries the hardest hit.

If the epidemic spreads in Japan and South Korea, it will bring a second blow to the global industrial chain and impact downstream companies in China

Song Xuetao

“If the epidemic spreads in Japan and South Korea, it will bring a second blow to the global industrial chain and impact downstream companies in China,” said Song Xuetao, an economist at Tianfeng Securities.

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Coronavirus: China, Japan, South Korea supply chains under threat from ‘second wave’ of disruptions

The three Asian countries contribute around 24 per cent of the entire world economy, but have been hit hard by the coronavirus outbreak China was attempting to boost trade and investment with Japan and South Korea to offset risks of decoupling from the United States

The three Asian countries contribute around 24 per cent of the entire world economy, but have been hit hard by the coronavirus outbreak

China was attempting to boost trade and investment with Japan and South Korea to offset risks of decoupling from the United States