Bangladesh faces uphill battle in meeting $110bn export goal: Experts

They cited persistent challenges in both global and local economies as significant hurdles.

With Bangladesh's exports growing at an average annual rate of 10.25 per cent over the past two decades, reaching the set target requires an acceleration in export growth.

The new export target has been set under the Export Policy for 2024-27.

However, concerns arise due to the global supply chain disruptions, exacerbated by the lingering effects of the Covid-19 pandemic and the Russia-Ukraine conflict, which have led to elevated levels of inflation globally.

This inflation has negatively impacted consumers' purchasing power, affecting both income and spending.

Data from the Export Promotion Bureau (EPB) indicates that Bangladesh exported goods worth $55.55 billion and services worth $7.50 billion in the fiscal 2022-23, with a combined growth rate of 3.42 per cent.

MA Razzaque, research director of the Policy Research Institute (PRI), highlighted the necessity for significantly higher growth rates to meet the target, which appears challenging given the current economic outlook, both globally and domestically. He also emphasised the lack of product diversification, particularly concerning Bangladesh's heavy reliance on garment exports, accounting for about 85 per cent of overseas sales.

Moreover, concerns about restricted import policies impacting exports and the depreciation of the local currency against the US dollar have been raised. While currency depreciation may enhance export competitiveness to some extent, it may not suffice to achieve the export target within the specified timeframe.

Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), suggested that export growth may reach a maximum of $80 billion by FY27 due to various challenges, including gas and power crises and issues in the banking sector.

To support the export sector, the Export Policy proposes a financial package as an alternative to direct cash subsidies. This includes the formation of an Export Development Fund, offering venture capital loans at lower interest rates and easier terms, along with consultancy and technical assistance for product development and diversification.

Additionally, incentives such as rebates on utility bills, exemptions on import duties for capital machinery, and cash incentives for service sectors and local shipping companies are proposed to facilitate export growth.

Fibre2Fashion News Desk (DR)