[🇧🇩] Bangladesh Export Industries

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Explore more export opportunities

A delegation of the Switzerland-Bangladesh Chamber of Commerce and Industry (SBCCI), led by its President Abdur Rashid, met Ahasanul Islam Titu, state minister for commerce, in a courtesy call at the commerce ministry in Dhaka on Sunday.

www.thedailystar.net

Explore more export opportunities​

State minister of commerce tells Switzerland-Bangladesh chamber leaders

Abdur Rashid, president of the Switzerland-Bangladesh Chamber of Commerce and Industry, greets Ahasanul Islam Titu, state minister for commerce, with a bouquet at the latter’s commerce ministry office in Dhaka on Sunday. Photo: Switzerland-Bangladesh Chamber of Commerce and Industry

A delegation of the Switzerland-Bangladesh Chamber of Commerce and Industry (SBCCI), led by its President Abdur Rashid, met Ahasanul Islam Titu, state minister for commerce, in a courtesy call at the commerce ministry in Dhaka on Sunday.

The state minister suggested the SBCCI explore more export opportunities to Switzerland, saying the ministry can play a pivotal role by providing all kinds of support, the chamber said in a press release.

Since Prime Minister Sheikh Hasina has labeled handicrafts as the "products of the year 2024", Titu emphasised how Bangladeshi businessmen could explore local and Swiss markets for artistic Bangladeshi handicrafts.

Bilateral trade between Bangladesh and Switzerland crossed the $1 billion mark, but Bangladesh has a huge trade deficit with Switzerland.

SBCCI President Rashid, who is also the country manager of SGS Bangladesh, said a cooperative partnership between the ministry of commerce and SBCCI was essential to overcoming obstacles and leveraging opportunities while conducting business with Switzerland.

Saad Omar Fahim, director of Clarichem and secretary general of SBCCI, provided insight into how Swiss businesses were driving innovation across various sectors in Bangladesh.

Among others, Saiful Islam, chairman and MD of Daffodil Trading House, Debabrata Roy Chowdhury, director of legal, regulatory, and corporate affairs, and company secretary at Nestle Bangladesh, Abul Hasnat, chief executive officer of Swiss Elegance, Sontosh Chandra Nath, chief executive officer of Alpha Vision, Md Rafiqul Islam, personal secretary of the state minister, and Mohammad Mohi Uddin Bhuiyan, coordinator of SBCCI, were also present.​

 

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Mirsarai Export Processing Zone (35000 Acres) update

 

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HATIL is a prominent furniture manufacturer and global brand hailing from Bangladesh. Their commitment spans sustainable production and corporate social obligations. This truth becomes evident upon delving into HATIL's manufacturing procedures, which diligently address waste management, recycling, and the judicious employment of resources. Today we'll shed light on HATIL's journey toward securing Sustainability and fulfilling Corporate Social Responsibilities.

Environmentally Friendly Factory of Hatil: Sustainability & Social Responsibilities Of HATIL - Business Inspection BD

HATIL, a leading furniture manufacturer in Bangladesh and a global brand recognizes that being an industry leader goes beyond product sales. They prioritize sustainability and corporate social responsibility in addition to their offerings.

businessinspection.com.bd

 

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Export earnings drop in April

A file photo shows containers being arranged with a crane at the Kamalapur Inland Container Depot in the capital Dhaka. Bangladesh's export earnings in April 2024 decreased slightly year-on-year compared with the same month of 2023 while the earnings in 10 months (July-April) of the current financial year 2023-24 grew by 3.93 per cent. | — New Age photo

Bangladesh's export earnings in April 2024 decreased slightly year-on-year compared with the same month of 2023 while the earnings in 10 months (July-April) of the current financial year 2023-24 grew by 3.93 per cent.

Exporters said that the shipment of apparel decreased in April due to various reasons, including Red Sea crisis, increasing cost of utilities and Eid-ul-Fitr holidays.

The country's export earnings in April declined by 0.99 per cent to $3.91 billion year-on-year compared with those of $3.95 billion in the same month of 2023, according to the Export Promotion Bureau data released on Thursday.

The EPB data showed that Bangladesh's export earnings in July-April of FY24 increased to $47.47 billion compared with those of $45.67 billion in the same period of FY23.

Export earnings from readymade garment in the 10 months of FY24 stood at $40.49 billion, which is 4.97 per cent higher than the earnings of $38.57 billion in FY23.

Export earnings from woven garments in July-April of FY24 failed to make any growth and the subsector fetched $17.61 billon which was same with the earnings in the same period of FY23.

Export earnings from knitwear in the 10 months of FY24, however, grew by 9.11 per cent to $22.88 billion compared with those of $20.96 billion in the same period of FY23.

The export growth of woven garments remained stagnant for past few months as the Red Sea crisis increased lead-time for Bangladesh by at least 15 days and buyers were shifting some orders to other manufact6uring countries, including China, Bangladesh Garment Manufacturers and Exporters association vice-president Abdullah Hil Rakib told New Age on Thursday.

He said that earnings growth from knitwear remained in positive territory as the subsector could manage lead-time due to using local raw materials.

Moreover, the increased cost of utilities increased production cost and many manufacturers failed to entertain some orders at the rate offered by the buyers, Rakib said.

He also said that in April production remained suspended in the factories more than one week due to the Eid holidays, which lowered shipment in the month.

The EPB data showed that export earnings from home textiles in July-April of FY24 fell by 25.32 per cent to $702.56 million compared with $940.8 million in the same period of FY23.

Earnings from leather and leather goods in the 10 months of FY24 fell by 13.32 per cent to $872.45 million compared with those of $1.00 billion in the corre sponding period of FY23.

Earnings from leather-footwear exports in July-April of FY24 declined by 25.80 per cent to $430.68 million compared with those of $580.40 million while the other leather products fetched $328.24 million with a 1.63-per cent growth in the period.

Export earnings from jute and jute goods in the 10 months of FY24 fell by 7.05 per cent to $716.44 million compared with those of $770.82 million in the same period of FY23.

Export earnings from agricultural products in the period, however, increased by 6.12 per cent to $774.49 million compared with those of $741.35 million.

Export earnings from frozen and live fish decreased by 13.34 per cent to $321.93 million and the earnings from shrimp exports fell by 20.48 per cent to $212.29 million in the 10 months of FY24.

Export earnings from engineering products in July-April of FY24 declined by 0.4 per cent to $436.35 million compared with those of $438.11 million in the same period of the previous financial year.

 

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With friends like these - who needs enemies...

MSN

New Delhi: Citing severe congestion at Delhi airport because of which airlines have started charging three times the normal tariff, Indian garment exporters have asked the central government to stop allowing transshipment of Bangladeshi goods to third countries via Delhi.

The congestion at the Delhi airport is due to the Red Sea crisis, which has forced companies to use air routes for export of goods.

While New Delhi and Dhaka have, over the past two years, taken collaborative steps in terms of transit and transshipment of goods, India has also been pushing its domestic textile sector to achieve a $100 billion export target by 2030 and compete with other garment giants in Asia, such as Bangladesh, Vietnam and China.

Meanwhile, Bangladesh has grown into a garment powerhouse, manufacturing for major clothing brands like H&M, Zara, Tommy Hilfiger, Gap, Calvin Klein and Hugo Boss — giving stiff competition to their counterparts in India.

Apparel Export Promotion Council (AEPC), India's official body of apparel exporters, Thursday requested the Central Board Of Indirect Taxes and Customs (CBIC) to roll back its circular dated 7 February that allowed transshipment of Bangladesh export cargo to third countries through Delhi Air Cargo complex. Previously, these goods were allowed only through Kolkata airport.

" It's unlikely the circular will be reversed because it could be seen not only as protectionist measure but also contrary to providing reciprocal trade facilitation as agreed by the leaders of the two countries in the 2022 joint statement," Mustafizur Rahman, a Distinguished Fellow at the Centre for Policy Dialogue (CPD), a Dhaka-based think tank, told ThePrint.

(Edited by Richa Mishra)

 

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https://thefinancialexpress.com.bd/views/export-trends-and-dynamics-in-bd

Export trends and dynamics in BD
MOHAMMAD ABDUR RAZZAQUE, BARUN KUMAR DEY AND RABIUL ISLAM RABI
Published :
May 28, 2024 21:52
Updated :
May 29, 2024 21:50

Despite the success in garments exports, the overall export size in Bangladesh remains modest and is characterized by a staggering concentration. Among the Least Developed Countries (LDCs), Bangladesh is often regarded as an example of export-led growth and development. Over the past two decades, merchandise exports in Bangladesh grew from just $6.5 billion in 2003 to $55.0 billion in 2023. This was mainly spearheaded by the apparel sector, which grew during the same period from just less than $5 billion to $47 billion.

However, when compared to countries outside the LDC group, export volume (both including and excluding services) in Bangladesh appears modest. Most Southeast Asian countries have demonstrated stronger export performance. Considering Bangladesh's large population of 170 million, its current merchandise export volume of $55 billion is relatively small compared to other nations with similar population sizes. For instance, Viet Nam, with a population of 91 million, boasts a comparable export volume of over $360 billion; Indonesia, with 218 million people, exports $240 billion; and Thailand, with a population of 72 million, earns around $323 billion from exports. In addition, Southeast Asian countries with smaller population sizes like Malaysia and Singapore have equally achieved remarkable success as exporting nations.

Since the emergence of RMG in Bangladesh's export sector in the 1980s, its relative importance has consistently increased, resulting in a reduction of the share of erstwhile traditional exports (such as raw jute and jute goods, tea, leather, frozen fish) from over three-quarters to approximately 10 per cent.

To read the rest of the news, please click on the link above.​

 

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Three Chinese car companies (electric bus, truck and car mfrs., Lithium battery mfrs. as well as heavy construction equipment mfrs.) have started to look for JV partners in Bangladesh. Akij, Energypac and some other local conglomerates are in talks with them.

 

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Buyers want to shift production of Technical Textiles and Apparel from China to Bangladesh

April 29, 2024

TechTextile & TexProcess 2024, the international trade fair for technical textiles and textile processing , kicks off on April 23 in Frankfurt , Germany . The exhibition ended on April 26 . The representatives of the foreign buyers who gathered at the stalls of the participating companies in Bangladesh said that they want to bring the production of technical or technical clothes from China to Bangladesh, albeit slowly . Because the cost of production in China is increasing.

Teams Manufacturing Company , Akiz Jute Mills , Smee Apparels , M & A Sourcing Bangladesh and Nexgen Apparel participated in the four-day exhibition as co-exhibitors of Export Promotion Bureau ( EPB ) .

On the third day of the exhibition on April 25 , representatives of clothing marketing organizations in Europe including Turkey and the United Kingdom came to the Bangladesh Pavilion . The stakeholders in stalls in Bangladesh Pavilion said that Bangladesh 's steps in the production of technical textiles and clothing are at an early stage but interest and technical capability implementation are both developing rapidly.

Bugrahan Turgut, sales and marketing officer of Navistanbul Textile and Promotion , who came to the exhibition , told Merchant News , "Until now , we produce all products in Turkey and China . In China we manufacture workwear , uniforms , fashion products and promotional textiles . We want to start production in Bangladesh . "

Among the products displayed by Bangladeshi companies at the exhibition were coats apparel , professional and protective clothing , active wear , jute yarn , jute bags and other products , men's and ladies' long and short pants , workwear / uniform , oven and knitwear and lingerie .

China is currently the best producer of technical garments . Next is Vietnam .

A basic t - shirt made for $ 1.50 or $ 2 makes a profit of 2-3 cents at the end of the day . But if one can make technical clothes , there is more than 10 percent profit . During the three days of this exhibition , discussions were held with more than thirty buyers about existing and upcoming products and purchase orders .

Garment exporters said that the main materials for making rain & waterproof clothing and fireproof clothing are fabrics or fabrics produced with special technology. Bangladesh's capacity to produce such textiles and clothing is currently negligible but has high interest from buyers and factory owners.

The concerned industrialists want to increase this capacity gradually . For this purpose, they are also participating in international exhibitions on technical technical textiles and textile processing .

 

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Only 10% of planned economic zones get off the ground in a decade
BEZA now plans to set up 100 industrial enclaves by 2041 instead of initial deadline of 2030

Only 10 economic zones (EZs) have become operational since the Bangladesh Economic Zones Authority (BEZA) rolled out its massive industrialization plan in 2015, raising questions about whether its goal of setting up 100 enclaves will be materialized on time.

The board of the BEZA has approved a total of 97 EZs over the past decade. Of them, 68 zones will be set up by the government and 29 by the private sector, with the initial deadline set at 2030.

Of the 10 economic zones, two are government-run -- Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) in Chattogram, the Sreehatta Economic Zone in Sylhet -- and eight are private.

The private EZs are City Economic Zone, Meghna Industrial Economic Zone, Meghna Economic Zone, Hoshendi Economic Zone, Abdul Monem Economic Zone, Bay Economic Zone, Aman Economic Zone, and East West Economic Zone..

He said the Beza has revised its target to set up 100 EZs by 2041 from 2030 initially since implementing an economic zone project takes time.

"We will be able to make at least 38 EZs operational by 2030."

Syed Akhtar Mahmood, a former lead private sector specialist at the World Bank Group, praised the idea of EZs as effective since there is land scarcity in Bangladesh and the country is looking for well-planned industrialization.

He suggested providing land only to investors who have good intentions of setting up factories. "Otherwise, genuine investors will not get the land when they need it."

Mahmood said the BEZA should implement EZs in phases instead of going after all of them simultaneously.

"This is because if all EZs are implemented concurrently, none of them will be executed properly since there is an involvement of a huge amount of funds."

"There will not be much delay if the BEZA puts the experience to good use when implementing the projects."

BEZA has received $28.75 billion worth of investment proposals from companies at home and abroad. The actual investment stood at $6.05 billion between 2020 and June 30 last year.

According to a report of the agency, the operating zones have employed around 60,000 people. Some 7,000 are working in government-owned zones and 53,000 in private zones.

Products worth $14.47 billion were produced in 10 EZs in the last fiscal year of 2022-23, it said.

 

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A variety of items being made in Chittagong Export Zone

 

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Export diversification still a far cry

Although the need to diversify Bangladesh’s export basket has been a subject of great discussion for more than two decades, there has been little progress in this regard.

www.thedailystar.net

Export diversification still a far cry

Although the need to diversify Bangladesh's export basket has been a subject of great discussion for more than two decades, there has been little progress in this regard.

In fact, there has been no reflection of diversification in exports. On the contrary, readymade garments (RMG) continue to dominate, accounting for around four-fifths of all of Bangladesh's exports.

Though garment exports surged from $1.18 billion in the early 1990s to $47 billion by 2023, non-RMG exports grew from $811 million to just over $8 billion.

Between FY02 and FY23, exports soared by 828 percent from $5.9 billion to $55.55 billion, buoyed by a 925 percent rise in apparel exports.

However, despite the overall growth, the ratio of non-RMG exports to total exports declined from 24.86 percent in FY02 to 15.42 percent in FY23.

Photo: Rajib Raihan

At present, Bangladesh's exports are largely made up of knitwear (44.6 percent) and woven garments (37.2 percent), with home textile (3.3 percent), footwear (2.3 percent), jute products (1.9 percent), and fish (1 percent) being other notable products.

Bangladesh's overwhelming dependence on RMG means that its export basket is among the world's least diversified.

Bangladesh's export basket is four times more concentrated than the developing-country average, according to a report by the Asian Development Bank (ADB) titled "Fostering Export Diversification in Bangladesh".

Along with product concentration, Bangladesh also suffers from a lack of export market diversification.

More than four-fifths of its exports are destined for North American and EU markets. Furthermore, Bangladesh's top-10 export destinations account for 72 percent of its total exports, while the corresponding figures for India and Sri Lanka are 52 percent and 64 percent.

Experts identified that policy and financing barriers and a lack of infrastructure development in the non-RMG sector had slowed export diversification.

"There were four major barriers in expansion of export diversification -- policy issues, financing barriers, lack of infrastructure, and weak bargaining power of non-RMG exporters," said Selim Raihan, executive director of the South Asian Network on Economic Modeling (SANEM).

He also said that non-RMG and RMG exporters cannot practically avail the same benefits.

As an example, he said RMG exporters can import capital machinery at zero duty while non-RMG exporters have to pay high tariffs to import necessary equipment.

Non-RMG exporters cannot even avail bonded warehouse facilities as easily as RMG exporters, which is a significant barrier to expediting export diversity, he said.

He also said the agro-processing sector had been failing to live up to its potential to increase exports due to a lack of infrastructure and proper government support.

Ferdaus Ara Begum, CEO of Business Initiative Leading Development (BUILD), said: "Export diversification has not happened because of several reasons. Even within the RMG sector, little diversification has happened."

Bangladesh exports only four to five products in the RMG sector, which has given buyers the chance to bargain for the prices of cotton garments, she said, adding: "Prices are falling lower and lower."

The need is to invest in manmade fibre, which requires huge investment and utility support, she said.

She added that the gas crisis, which has been affecting industries in recent years, was preventing industries from running operations smoothly. This poses a significant barrier to large investments in the country.

According to her, financing support is another issue as the export development fund is used by limited entrepreneurs.

CHALLENGES FROM LDC GRADUATION

Intensifying its diversification initiatives in preparation for the country's graduation from least-developed country (LDC) status in 2026 is imperative for a smooth transition.

As an LDC, Bangladesh enjoys unilateral trade preferences in markets in Canada, the EU and the UK. Such duty-free market access has endowed Bangladesh with a significant competitive edge.

In fact, more than 70 percent of the country's merchandise exports enjoy some LDC-specific trade preferences, which is far higher than other LDCs in Asia and the Pacific.

However, these benefits will cease after graduation unless they are extended.

For example, Bangladesh's duty-free access to the EU is set to expire in 2029 given the EU's additional 3-year transition period for graduating LDCs.

Post-graduation market access provisions in the EU are not yet settled, but under currently proposed terms, the average tariff rate facing Bangladesh's garment exports to the EU would increase from zero percent to about 12 percent.

At the same time, Bangladesh's exporters could see average tariffs on exports rising from zero to 17 percent in Canada, 16 percent in China, 8.7 percent in Japan, and 8.6 percent in India.

"The post-LDC scenario will be grave. After the reduction of cash incentives, exports of almost all sectors will decline," Ferdaus Ara cautioned.

A mismatch in export figures between the Bangladesh Bank, Export Promotion Bureau, and National Board of Revenue has worsened the situation, she added.

She said large investment in the export sector as well as utility, financing and tax policy support must be extended for export diversification.

"RMG is our success. We need to diversify the RMG products with a view to achieving at least $150 billion in exports from this sector by the next 5 years, which is possible," she said.

"We also need a clear sector-specific strategy."

Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD), said the RMG sector's faster rate of growth led to its dominance in Bangladesh's export basket.

However, he added that the growth of non-RMG sectors was very slow and, in some cases, even witnessed degrowth.

Rahman added that Bangladesh had received very little export-oriented foreign direct investment (FDI), which is one of the factors holding back export diversification. Another reason is that export-centric special economic zones are yet to be implemented.

He suggested mobilising export-oriented FDI and ensuring proper one-stop services would help export diversification efforts.

He added that a lack of technology and skilled human resources, particularly at the managerial level, was also restraining non-RMG sectors.

Although many studies have been conducted to identify the sectors with export diversification potential, practically the same sectors have been identified over time.

"The strategy of "picking winners" or targeting specific sectors for growth, such as the leather sector and information technology and IT-enabled services sector, has not succeeded as export targets have been consistently unmet," the ADB said.

"For the leather sector, the government had set an ambitious export target of $5 billion by 2021. Despite this focus and support, the sector's current exports are just above $1 billion, demonstrating the inability of the 'picking winners' strategy to produce the expected results."

M Masrur Reaz, chairman of the Policy Exchange of Bangladesh, said non-RMGs' share in Bangladesh's export basket had declined due to a lack of policy reforms.

"We need to bring the right support for those sectors to build up efficiency, including logistical support and adoption of technology," he said.

He also said an initiative to bring in export-oriented FDI is imperative because it is very difficult to diversify exports without foreign investment.

Another barrier to export diversification was posed by significant differences in the income tax rates between the RMG and non-RMG sectors.

The RMG sector has historically benefitted from a relatively lower corporate tax rate, ranging from 10 percent to 12 percent.

In contrast, non-RMG sectors, such as textiles, leather and leather goods, agro-processing and home textiles, have faced higher tax rates ranging from 15 percent to 30 percent.

Only recently, in FY23, a uniform income tax rate of 12 percent for both services and goods exports was introduced. This move is expected to rectify the existing bias in income tax rates for export-oriented industries.

In its paper, the ADB recommended addressing policy-induced disincentives against exports, boosting export market responsiveness and accelerating diversification.​

 

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Op-Seed Bangladesh exports a variety of electronic devices made from a basic level.



Tent House in one of the CTG EPZ's in Chittagong (there are four altogether) exports many types of camping tents overseas. Tents and Sewn Canopies are a major export item from Bangladesh.

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Bangladesh’s path to export diversification​

Assessing the opportunities and challenges in a time of change
https://www.dhakatribune.com/361929


Julia Wesemann
Publish : 15 Oct 2024, 12:47 PM
Update : 15 Oct 2024, 12:47 PM


Bangladesh has long been a global leader in the ready-made garment (RMG) sector, with textiles contributing around 84% of the country’s total exports. Yet, as the country faces shifting global dynamics and recent political changes, the urgency to diversify its exports has reached a critical juncture.

The student-led revolution has brought to light underlying social, political, and economic challenges that Bangladesh must now confront. As the new leadership charts a course forward, reducing the country’s overreliance on a single sector and building a more resilient and diversified economy will be paramount.


Bangladesh’s economy continues to be heavily dependent on the RMG industry. The sector’s rapid growth has driven the country’s economic development, created millions of jobs -- especially for women -- and significantly reduced poverty. However, the concentration of exports in one industry leaves the country vulnerable to external shocks, such as changing trade policies in major markets like the US and Europe, as well as growing scrutiny over labor rights and sustainability.

The recent political crisis, coupled with global economic uncertainties, makes it clear that Bangladesh must diversify its export base to sustain long-term growth. Export diversification not only strengthens economic resilience but also creates opportunities for new job creation, technological advancement, and investment in emerging industries.

Sectors with high potential

Bangladesh has several sectors beyond garments that show significant potential for growth and diversification. The new political climate offers an opportunity for the interim government to implement reforms and attract investment in these key areas.

• Information and Communication Technology (ICT): Bangladesh has made significant progress in developing its ICT sector. The country is now positioned to become a hub for IT outsourcing, software development, and tech startups. By improving digital infrastructure and education, Bangladesh can tap into the growing global demand for digital services and position itself as a regional leader in the tech industry.
• Pharmaceuticals: Bangladesh’s pharmaceutical industry has been expanding steadily, with the country already supplying affordable generic drugs to many developing nations. As demand for healthcare rises globally -- particularly after the Covid-19 pandemic -- Bangladesh has the potential to further grow its pharmaceutical exports. With investments in research, development, and quality control, the country could become a major player in the global pharmaceutical market.
• Leather and footwear: Bangladesh is one of the world’s largest producers of leather goods and footwear. However, environmental concerns, particularly related to the tannery industry, have limited the sector’s growth. By implementing stricter environmental standards and adopting sustainable practices, the leather and footwear industry could expand into high-value markets, such as luxury goods, further diversifying the country’s export base.
• Jute: Once known as the “golden fibre” of Bangladesh, jute has seen a resurgence in global demand due to its eco-friendly and biodegradable properties. As countries and companies move toward sustainable materials, Bangladesh has a unique opportunity to reclaim its position as a leading exporter of jute and jute products, catering to industries like packaging, textiles, and home goods.
• Agriculture and agro-processing: While Bangladesh has a rich agricultural heritage, its export potential in this sector remains underdeveloped. Investments in agro-processing and value-added agricultural products, such as frozen foods, spices, and seafood, could unlock new markets. Additionally, developing supply chains and logistics for agricultural exports could position Bangladesh as a significant player in global food production.

According to Sayful Islam, Deputy Director of the Bangladesh Investment Development Authority (BIDA): “We are prioritizing foreign direct investments (FDI) in key sectors to diversify Bangladesh’s export portfolio. With China’s recent policy adjustment allowing 100% duty-free imports of Bangladeshi goods, we see a strong opportunity to expand into alternative markets beyond [RMG]. Starting with this new access to China from December, we aim to establish a foothold that will help us grow and reach more sophisticated global markets.”

A clear vision and long-term strategy for export diversification, supported by sound governance, will be critical to driving progress

Challenges to diversification

While these sectors hold promising opportunities for diversification, several critical challenges must be addressed to unlock their full potential and sustain long-term growth. Inadequate infrastructure, particularly in transportation, logistics, and energy, remains a significant barrier to export diversification. Ports, roads, and supply chains must be upgraded to support the efficient movement of goods and reduce costs for exporters.

To move into higher-value industries like ICT and pharmaceuticals, Bangladesh needs to invest in education and vocational training. Building a skilled workforce that can meet the demands of emerging sectors is crucial to long-term success.

The recent political upheaval and transition to an interim government have introduced uncertainty into the business environment. Stability is essential for attracting foreign direct investment (FDI) and building confidence in the country’s economic future. A clear vision and long-term strategy for export diversification, supported by sound governance, will be critical to driving progress.

Bangladesh will face intense competition from emerging economies like Vietnam and India, which are also expanding into ICT, pharmaceuticals, and agro-processing. To stay ahead, Bangladesh must focus on innovation, sustainability, and high-quality production to carve out a competitive advantage.


How can we all contribute?

The student-led revolution has created both challenges and opportunities for Bangladesh. This pivotal moment provides a unique chance to reimagine Bangladesh’s economic future. However, building a more resilient and diversified economy is not solely the government’s responsibility. Active participation from all stakeholders is essential for long-term success. Here’s how various groups can contribute to this shared vision:

The new government: The interim government must prioritize reforms to improve the ease of doing business, invest in critical infrastructure, and foster innovation. Streamlining regulatory processes and providing incentives for industries beyond RMG will help attract both local and foreign investment. Policies that support small and medium-sized enterprises (SMEs) in emerging sectors such as ICT, pharmaceuticals, and sustainable agriculture will be crucial.

Exporters: Exporters need to diversify their product offerings and explore new international markets. Collaboration between exporters from different sectors can also lead to innovative cross-sector opportunities. By adopting sustainable practices and focusing on value addition, exporters can build resilience in a changing global market, positioning Bangladesh as a leader in new and high-value sectors like eco-friendly products, tech services, and pharmaceuticals.

Farmers and agro-entrepreneurs: Adopting sustainable practices and improving supply chains will help with untapped export potential, positioning Bangladesh’s agriculture as a key player in global markets.

Industry associations and chambers of commerce: Industry bodies, such as trade associations and chambers of commerce, play a vital role in building bridges between the private sector, government, and international investors. By offering support to new industries, providing market insights, and advocating for policies that encourage export diversification, these associations can help businesses toward sustainable growth.

Investors and venture capitalists: Both local and international investors will play a critical role in supporting emerging sectors. Venture capitalists and private equity firms should focus on funding startups and SMEs in industries like ICT, pharmaceuticals, and sustainable agriculture.

Educational institutions and vocational training centers: As Bangladesh seeks to diversify into higher-value industries, building a skilled workforce is essential. Educational institutions must provide the technical skills needed in sectors like ICT, biotech, and renewable energy.

Civil society and NGOs: Civil society organizations and NGOs must advocate for inclusive growth, sustainability, and equitable policies. They can work to ensure that marginalized groups, such as women and rural communities, benefit from new economic opportunities.



Julia Wesemann is Director of Growing Together and Founder of Co-creation lab.

 

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Worker rights should be ensured to protect export earnings

THE structural safety of factories has significantly improved after the Rana Plaza collapse that left more than a thousand apparel workers dead, but labour practices have largely...

www.newagebd.net

Worker rights should be ensured to protect export earnings
19 October, 2024, 00:00

THE structural safety of factories has significantly improved after the Rana Plaza collapse that left more than a thousand apparel workers dead, but labour practices have largely remained unfriendly for workers. A leading supply chain compliance provider, QIMA, reports a significant increase in worker rights violations regarding working hours and wages in the apparel sector. The organisation observes that 37 per cent of audited factories have made workers work beyond legal hours and failed to pay wages in time in January–September, which is more than double the rate reported in 2023. Bangladesh’s compliance score is lower than other apparel manufacturing countries’ and it is gradually declining. The global incidence of critical violations in working hours and wages identified in factory audits was 16 per cent, with rates of 20 per cent in China and 11 per cent in Vietnam. The compliance providers report is consistent with the claims of trade union leaders and labour organisations in Bangladesh that policymakers have since the Rana Plaza collapse been especially concerned about improved structural safety issues but left everyday labour rights violations unattended.

Apparel workers taking to the streets over wage disputes is common. In the changed political context, after the fall of the Awami League government in August, many workers were injured and at least two workers were killed when they protested against the sudden closure of factories without clearing worker’s due wages or demanded an increase in the minimum wage. Trade union activists in Dhaka and Gazipur report that at least 2,000 workers of 20 apparel factories lost their job in September. Many studies have already documented how workers had to work longer than the legal workday, partly because the minimum wage is far too low for them to survive at a time when food inflation has reached an unprecedented high. It is also because factory management often compels workers to work overtime to complete work orders. The apparel sector also has the tendency to deny workers severance or maternity benefits. There are reports that pregnant women are asked to quit the job so that the factories can avoid paying the maternity benefits. Worker’s trade union rights, as QIMA observes, are also regularly violated. Firing workers for their participation in movements for wage increase was widely reported in 2023.

The apparel sector is the largest export-earning source for Bangladesh and working-class women constitute the major part of the labour force. A progressive decline in compliance score, as reported in the QIMA report, could, therefore, risk Bangladesh’s export earnings and it may lose the competitive edge on the global market. Considering the significance of the apparel sector for the economy, the government should abandon any policy bias towards the factory-owning elite and sincerely address worker grievances. A routine delay in wage payment, denial of severance benefits, arbitrary job termination and rampant violation of trade union rights are among long-standing concerns that the government should sincerely address to ensure a steady growth in the sector.​