Op/Ed by Chris Devonshire-Ellis
As the behavior of the coronavirus is getting better understood, there will be extended issues for businesses throughout the Asian region now until well into Q1, and quite possibly into late March. Here are some updates, followed by business advisory from Dezan Shira & Associates.
- Virus appears to be spread via respiratory drops: sneezing and coughing. Confirmed cases in Japan and Germany have come from individuals who had not traveled to China but had been exposed to Chinese nationals on Lunar New Year holidays.
- Virus appears to have a 7-14 day, non-symptomatic incubation period, meaning carriers may feel fine while actually being infectious. This is why 7-14 day quarantine periods and bans on travel in China are being put into effect. We expect more travel bans to be enforced in the next few days throughout the Asian region.
- ASEAN and other Asian countries are being affected, many have canceled Visa on Arrival, others will undoubtedly follow. For the latest news on how the virus is affecting ASEAN and nearby Asian nations, please click here.
- We have specific concerns about the relative lack of precautions and monitoring in Thailand and Vietnam. India also looks problematic, and we expect cases to rise sharply in these countries. Businesses in these countries also need to start looking at preparing contingency plans and facing travel restrictions.
Our firm has several hundred people based in China. We also worked during and advised businesses on operations in China during the SARS epidemic. We are as impacted by the coronavirus as anyone, and have experience in handling these difficult times. We will try and share as much practical information on handling the problems caused by the virus as possible.
- Keep all travel to China to a minimum, and if possible do not travel at all.
- Establish communications with all employees, suppliers, and other vital connections to your business.
- Implement work from home procedures. Travel in China is likely to remain locked down for some time. Utilize software such as Sharepoint to enable staff to remotely access necessary administration.
- Revisit 2020 and Q1 budgets and be aware of the potential financial impact of severely impacted operations and income during this period. Use worst case scenarios for financial modelling and prepare to release operational reserves to carry over the next quarter.
- Other business tips for managing your business during this time can be found here.
We do not expect any return to normality for businesses in China during this month and probably through until late March. This means steps need to be taken to remotely manage and administer your China business with minimal or no office staff in situ. We will be providing advice on how to remotely manage your China business, including the use of software applications, operating systems, and the CFO function in the coming days. To ensure you receive these updates, please sign up to our complimentary subscription service here.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at email@example.com.
We also maintain offices assisting foreign investors in Vietnam, Indonesia, Singapore, The Philippines, Malaysia, and Thailand in addition to our practices in India and Russia and our trade research facilities along the Belt & Road Initiative.