SMEs to face capacity constraints after LDC graduation: Experts

Small and medium-sized enterprises (SMEs) in Bangladesh will face capacity constraints and a shortage of skilled human resources after the country graduates from least developed country (LDC) status, said Selim Raihan, executive director of South Asian Network on Economic Modeling (Sanem).

At a seminar on Saturday, he also said that SME entrepreneurs will face a dearth of financial and policy support, as well as a lack of proper infrastructure, in the post-LDC period.

The seminar titled "Improving Export Capabilities of SMEs: Succeeding Globally upon LDC Graduation" was organised by the Dhaka Chamber of Commerce and Industry (DCCI) in a Dhaka hotel.

Selim Raihan said that SME entrepreneurs need to formulate and implement effective skill development programmes. The government needs to provide them with financial and policy support.

While presenting the keynote speech, he also said that the government should create special economic zones, revise labour laws, sign free trade agreements, to increase the efficiency of SME entrepreneurs.

The discussants at the seminar said that information technology capacity building, easy access to loans, product diversification, research and innovation, and infrastructure development are essential for the development of small and medium-sized entrepreneurs in Bangladesh.

DCCI President Md Sameer Sattar said that after Bangladesh's LDC graduation in 2026, exporters, including SMEs, will have to pay higher duties on export goods, which may be up to 8%-16%.

He also said that SMEs in Bangladesh face various obstacles, including lack of capital, lack of infrastructure, technical skills, and human resources in business operations.

The DCCI President also emphasised the need to revise the definition of SMEs, especially by separating micro from medium enterprises, and to introduce an export development fund to support the development of entrepreneurs in the sector.

In her speech as the chief guest, Speaker Shirin Sharmin Chowdhury said that SMEs contribute about 30% to the GDP. She called on policymakers to ensure that SMEs receive the support they need to overcome these challenges.

The High Commissioner of Canada in Bangladesh Lilly Nicholls said that SME entrepreneurs in Bangladesh lack financial, technical, and skills support.

She emphasised the need to conduct more research activities for product diversification, market expansion, and capacity building.

She added that the Canadian government is working with Bangladesh to develop the country's technical and vocational education system and exports.