Chinese companies on Costa count the cost of coronavirus

Some 250 wholesalers on local industrial estates import goods from China but supplies are dwindling. SUR
Some 250 wholesalers on local industrial estates import goods from China but supplies are dwindling. SUR
  • As well as the effect on Asian-owned businesses, principally restaurants, bazaars and import firms, Malaga-based companies who sell to China are also being hit

Chinese-owned businesses are a common sight along the Costa del Sol and most have been feeling the direct and indirect effects of the coronavirus outbreak in recent weeks.

A spokesperson for the local Chinese business community has explained what fear about the virus has meant for these Costa firms, which are mostly restaurants, bazaar-style shops and wholesalers of Far-Eastern imports.

Leticia Chen told SUR that initially many local people stopped going to Chinese firms, but now customers understand there is little real risk in visiting them. "The high street businesses are recovering little by little as income dropped 30 to 35 per cent."

However, the around 250 wholesalers who import Chinese goods, mostly based on the Guadalhorce industrial park close to the airport, are still being affected, Chen claims. These are starting to run out of stock as the ships aren't leaving China. "On the industrial estate there is very little movement. Imports have halted due to the scarcity of goods. There are some business owners who have chosen to take a holiday."

In the Wok Asia buffet on Malaga's Paseo Marítimo, they are trying to make the best of it. The owner, Guoguang Zheng, said, "The first few weeks we saw a drop off in customers, but now it's hardly any fewer," adding that there is no risk to potential customers at all in Chinese restaurants.

Meanwhile, other businesses in the Malaga area that buy and sell goods and services to or from China are being hit. Data shows 348 million euros in goods was imported from China to the area last year and 185 local companies sold a record 134 million euros.

Pork exporters at risk

The biggest exporters at risk are those selling processed meat products, principally pork. These make up 75 per cent of local exports. Two big meat firms, Famadesa and Faccsa-Prolongo, make an estimated 20 per cent of their sales to China.

"We're exporting a lot less than we were and we've had a lot of problems with the shipping containers," admitted the owner of Famadesa, Federico Beltrán. The double hit of the usual shutdown in China for New Year and then coronavirus has exasperated the problem, he added.

Alternative markets

"Containers are starting to leave but they've been completely on hold for 20 days," said Beltrán. He explained that, like other Spanish producers, he has started to freeze meat and look at alternative markets. "We hope the situation gets back to normal soon; if not we'll be talking about serious problems."

Faccsa-Prolongo said that its containers weren't being delayed any longer but the shipping lines had put up their prices.

A spokesperson for Dcoop, the local olive oil industry giant, said that the cooperative was "worried" about the long-term economic impact of the health scare, although, for the moment, the only real action taken was the scaling back of its presence at international trade fairs.

The highest-profile fallout this week on importers from China was the reported imminent temporary layoffs at Fujitsu Ten in Malaga.

Other firms that import from China have been commenting on their experience. Jorge Rosaro, boss of locally based electrical goods chain, MGI, said that the its saviour had been the stock it already held. "That gives us room for manoeuvre for several months," he explained.

At Román y Martos, a large firm supplying hotels and restaurants, some frozen fish from China is "being delayed" but the company said it was hopeful the situation would improve "in a month or two".