Bashir stresses on export diversification other than RMG

As Bangladesh's export trade is heavily dependent on apparel contributing the lion share of the country's export earnings, Commerce Adviser Sk Bashir Uddin has strongly affirmed the government's stance regarding diversification of exportable items other than RMG.

The commerce adviser came up with such stance while giving an interview to the national news agency BSS at his office at Bangladesh Secretariat.

Asked about the export earnings and move towards diversification of exportable items other than RMG, he said that the country has bright prospects in leather, fish, shrimp, jute and jute goods other than RMG, but their export growth did not turn negative all on a sudden.

It happened through a process mostly due to the results of the unruly acts by the previous AL regime while the interim government has been trying to address the matters, he said, adding, "Thanks to Almighty Allah that we've attained export growth, but it is vulnerable for us that we're still dependent heavily on a single product which is RMG,"

For Bangladesh, export concentration has emerged as a major and long-standing challenge. Before the 1980s, a few primary products dominated Bangladesh's exports.

The growth of the RMG industry resulted in a short-lived phase of diversification in the late 1980s, during that time garments and non-garment exports held nearly equal shares.

However, while non-RMG exports grew at a compound annual rate of 7.6%, from $1 billion in the early 1990s to just over $8 billion by 2023, garment exports surged from $1 billion to $47 billion in the same period, with an annual growth rate of 14.6%.

Bangladesh's heavy reliance on a single export product makes its export basket one of the least diversified globally.

The commerce adviser said that the Jute Diversification Promotion Center (JDPC) has unveiled some 284 diversified products from jute, but it is a 'fallacy' since these 284 products all together could not fetch even Tk 284 crore or one fourth of the export earnings although such things had long been happening.

"We all together had fallen into unruly environment for which a one-sided imposed growth was attained during that regime (AL). What was actually attained is really a matter to be considered seriously," he noted.

Bashir said that the ministry of commerce is also taking some epoch-making initiatives in potential sectors like leather and leather goods in consultation with the industries ministry regarding the issues on CETP at Savar Tannery Estate.

Hopefully, the problems should be resolved by the end of this year if everything goes accordingly, he added.

He said if the tannery owners and leather manufacturers work unitedly with the concerned government agencies, then goals can be achieved by the end of this year.

The commerce adviser said the problems regarding CEPT in Savar can be resolved within this year for getting LWG certification.

When asked about the role of the commercial wings in promotion of exports, he said that his ministry alongside the Bangladesh Investment Development Authority (BIDA) has been working to this end through engaging the concerned commercial wings.

Bashir said that in most cases the commercial counselors were earlier used to do the political protocol duties except some little work regarding export promotions.

"But, I asked them to pursue that the government not only wants to promote exports, but also wants to make imports at a competitive price having good quality. We have to work in both the sectors. Besides, we also want to attract investments," he added.
The commerce adviser said they have a plan to hold one meeting per month virtually with all the commercials wings abroad in association with the BIDA.

If such practice continues, he said then the concerned officials at the commercials wings abroad would be asked to work specifically in attaining the goals, creating sensitivity, and taking programmes for facilitating trade.

"Even we're also sending new manpower in those stations after considering their capability. These are not priced postings, rather competent postings," he said, adding that they are working in this regard giving priority on eligibility.

Relevant stakeholders and experts said the RMG sector receives substantial support from the government, including cash incentives, bonded warehouse facilities, easy bank financing, and policy interventions during times of difficulty.

The RMG sector also benefits from lower production costs and large-scale employment, creating a disincentive for exploring and developing other sectors.

Besides, Bangladesh's excessive dependence on the USA and EU makes its exports highly vulnerable. To reduce this over-reliance, it is crucial to explore and expand into new markets, such as Southeast Asia, the Middle East, Africa, Eastern Europe, Latin America, and other regions of North America.

Other potential sectors, such as leather and leather goods, jute and jute goods, agricultural and processed products, handicrafts, pharmaceuticals, ICT and ICT-enabled services, and light engineering products do not receive the same level of support as the RMG sector.