The government mulls earning $60 billion from the export sector by 2021. This will coincide with marking the 50th anniversary of the country’s independence.
Highlighting export earnings of $40.5 billion in the last fiscal year, this target is still achievable within 2 years, if the government takes some steps as early as possible, experts opine.
To make export growth sustainable, the government has to add more diversified products to the export basket side by side to find some new potential market across the world, they added. However, ninety two percent of total export earnings of the country came from only five products including ready-made garments, jute and jute goods, frozen foods, agricultural products and leather and leather products.
Official data show export earnings from only one product of readymade garments, accounts for more than 84 percent of the total export earnings during the FY19. It is high time to focus on new and potential export items, like jute and jute goods, leather, agricultural products and pharmaceuticals, in order to come out of overdependence on readymade garments, economists said.
To compete with other Asian countries, notably China, India, Indonesia, Malaysia, Sri Lanka, Thailand and Vietnam, it is necessary to come up with more diversified products, they commented. Existing government policies to boost export earnings appear to be fruitful for several items. But more support for other potential products on the part of the government can help export earnings rise to a great extent, they added.
They said the government has to give priority to ensure ease of doing business for creating business-friendly environment. However, the country fetched record $40.53 billion export earnings in the last fiscal year (FY2018-2019), up by 10.55 percent over the previous fiscal. The inflow was $36.66 billion in fiscal 2017-18.
The export earnings beat the strategic target of $39 billion set for the last fiscal by 3.94 percent. The export earnings from readymade garments increased by 11.49 percent during the FY19 from $34.13 billion in the previous fiscal. On the other hand, export earnings from agricultural products stood at $908.96 million during the time, up by 34.92 percent against $673.69 million earned in the previous fiscal.
Besides, the plastic sector also witnessed a positive growth of $119.8 million during the time, which was 21.65 percent higher from $98.48 million in the previous fiscal. Meanwhile, export earnings from chemical, Petroleum bi Products, cotton and cotton products, furniture, ceramic products and handicrafts also saw a positive growth. Export earnings from the respective sectors were $205.18million, $203.74 million, $152.16 million, $74.89 million, $68.97 million and $19.95 million respectively.
However, the leather sector needs special care for a rebound due to its facing huge difficulties to compete in the global market.Export earnings from this sector stood at $1019.78 million during the last fiscal, which was 6.06 percent lower than that in the previous fiscal. During the FY18, the figure was $1085.51 million.
Besides, jute and jute goods and engineering finished products also decreased by 20.41 percent to $816.27 million and by 4.12 percent to $341.3 million during the time.Frozen and live fish, home textile and wood and wood products also witnessed a negative growth during the period. The figures were $500.4 million, $851.72 million and $3.91 million respectively.
Commerce Minister Tipu Munshi on Friday said at a program Bangladesh can achieve the export target of $60 billion by 2021 if we can ensure new products, value addition and market diversification. He said the government has given priority to ensure ease of doing business for providing all necessary support under an umbrella with a view to promoting business.
The minister also urged the business community’s support to improve the overall environment to ensure proper economic growth. He said “The government has created opportunities to foreign investors for the expansion of business and committed to providing all kinds of cooperation to promote local and foreign investors.”
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) president Sheikh Fazle Fahim said Bangladesh has one of the most liberal and flexible investment place in South Asia as the government has offered a lot of incentives to investors. He also said the FBCCI has given many supports including trade and investment facilitation and policy advocacy for creating business friendly environment in the country.
Abdus Salam Murshedy, President of Exporters Association of Bangladesh (EAB), told Bangladesh Post that export earnings have been increasing gradually, which is a positive news for Bangladesh. Highlighting the government’s initiatives to establish the apparel sector in the global market, he said, “It is high time to extend similar support to other potential sectors like agriculture, ceramic and pharmaceutical industries.”
“This will reduce overdependence on the RMG sector,” he said. He noted that the country now is capable of making best quality products at low prices, which will help enhance export earnings even more from developed countries.Murshedy had suggested that the government should act promptly to reduce trade barriers with different countries, which will help enhance export earnings by diversifying the market globally.
Eminent economist and former governor of Bangladesh Bank Saleh Uddin Ahmed said for export diversification, the government needs to encourage entrepreneurs by giving several fiscal and technical support. He stressed an exemption of taxes on raw materials and backward linkage industries to survive competition with others, which will help to expand the country’s export earnings.
BGMEA president Rubana Huq said RMG is leading the export sector as it covers almost 90 percent of total export earnings of the country.Hence, the government will have to give more emphasis on this sector, she added.The BGMEA head said they are now working to create new markets by promoting their products in order to raise export earnings.