Experts call for developing potential export sectors to tackle post-LDC challenges

To overcome the challenges likely to follow Bangladesh's graduation from the list of least developed countries (LDCs), experts say the government should give adequate policy support and incentives to the non-apparel business sectors that have export potential.

The country must focus on export diversification, a must for a sustainable export industry in a post-LDG era, they said at an online virtual dialogue titled "Challenges and way forward on export diversification of Bangladesh upon LDC graduation", which was organised on Wednesday by the Dhaka Chamber of Commerce and Industry (DCCI). 
 
DCCI President Rizwan Rahman said in his opening remarks, "After the LDC graduation, Bangladesh will lose many international support measures and face several duty and non-duty tariff challenges." 

"Bangladesh has as many as 1,750 goods in its export basket but over 80% of export earnings is generated from only the readymade garment (RMG) sector. We have five years and by then, we have to get ready to face the post-LDC challenges by expanding our product range and ensuring other compliance issues," he added.

Joining the dialogue as chief guest, Vice Chairman and CEO of Export Promotion Bureau (EPB), AHM Ahsan said, "LDC graduation is a matter of pride for us but it will create some challenges for us as well."

"The government is adopting necessary strategies for a smooth and sustainable graduation from a less developed country status. To this end, we have to focus not only product diversification, but on geographic diversification as well," he added. 

He underscored the need to expand the country's export market to Latin America, Africa, Asia, and Middle Eastern countries other than in the EU or USA. 
 
Prof Dr Mustafizur Rahman, distinguished fellow at Centre for Policy Dialogue (CPD), said, "RMG is a success model to us. But now we must  focus on other potential non-RMG sectors like agriculture, pharmaceuticals, light engineering, ICT, leather goods, and jute." 

"Currently, 70% of our exports are done under the umbrella of preferential market access. After LDC graduation, compliance will be a major issue. To ensure that, we have to enforce domestic regulations aligned with WTO compliance rules," he continued.  

He reiterated the need for innovative financing. He also urged ensuring the export competitiveness of service sector products.
 
Md Saiful Islam, president of Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh, said, "We may not get low-cost funds from development partners after 2026 which may also increase costs in the private sector. To meet the challenge of this possible erosion after LDG graduation, the private and public sectors should partner to work jointly." 

"We need to analyse skill gaps and create a skilled labour force to boost our productivity. We have to go for energy savings, saving raw materials, and other cost saving mechanisms." 

He also urged policy support to strengthen backward linkage industries. 
  
Syed Almas Kabir, president of Bangladesh Association of Software and Information Services (BASIS), said, 'The country's ICT sector now generates about $1 billion in export earnings. But due to lack of authorised payment mechanisms, all this is not reported properly." 

"Bangladesh is now the 2nd largest outsourcing destination in the world," he said, requesting cash incentives for the ICT sector to make it a big player in the export industry of Bangladesh.