Govt sets sights high on $72b earnings

The government sets sights high on US$ 72 billion in export earnings in the current fiscal in an 11.52-percent annual growth, despite global financial jitters.

Commerce Minister Tipu Munshi made the announcement Wednesday at a press conference held at his secretariat office, striking a note of optimism that the export target is achievable through navigating reported adversities on the global market.

All factors--LDC graduation, decline in global demand due to high inflation, uncertainty stemming from the Russia-Ukraine war, recent global phenomena, monetary pressures and tightened financial sector--are taken into account in setting the new export target.

Of the total turnover, merchandise export has been set at US$62 billion, 11.59-percent higher than immediate-past financial year's achieved earnings worth U$ 55.56 billion.

Some US$10 billion is eyed from services export in the current FY2023-24 on the back of an 11.11-percent growth over the achieved earnings of US$9.0 billion in the last fiscal.

Prior to the declaration, a meeting was held with the stakeholders, including business leaders, traders and senior officials of commerce and different state agencies, with the commerce minister in the chair.

"Many think that this export target is ambitious. But it is possible to achieve. We have to work on some issues, including fuel, electricity," Mr. Munshi told reporters about the target set and the tasks to be done to get to the goal.

He said traders informed in the meeting that it would not be possible to achieve the set target if the supply of required fuels, including gas and electricity, is not adequate.

Bangladesh bagged US$ 64.56 billion by exporting goods and services against the set target of US$67 billion in the last FY, 2022-23.

As usual, readymade garment (RMG) sector has been considered major export earner this fiscal, too. The government has still been working to expand baskets of various export items, including man-made fibre (MMF) apparel.

He expects that production in the country's industrial units will continue uninterrupted to maintain the export momentum.

However, exporters and economists expressed mixed opinions regarding the achievement of the export target, in view of the current realities across the world reeling from twin-crises of pandemic and war.

Replying to a question, the minister said, "We have huge trained workforce and affordable cost of products. A good number of entrepreneurs are relocating their industrial units from China for geopolitical causes and Vietnam is facing labour issue."

He hopes it would be possible to obtain the target if Bangladesh can use the opportunities properly.

A leading apparel exporter was optimistic about reaching the USD72- billion mark set for the fiscal 2023-24.

"It would be possible to achieve the target though it is higher," Executive President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Mohammad Hatem said at the function.

He noted that industry was supposed to get uninterrupted supply of gas-electricity, "but we are not getting it. Again, the electricity line is being cut off even though the bill is due for two months".

He adds: following LDC graduation after 2026, no cash facility will be for the export sectors from the government side. But China is still providing cash assistance.

He suggests finding a byway to continue the cash assistance after graduation.

The knitwear-sector leader fears that the country could achieve 10-percent lower growth from the set export target if the prevailing gas and electricity crisis is not met immediately.

He has also urged the government to take step to resolve the existing VAT and customs-related problems.

Mr. Hatem mentioned "non-cooperation" from the National Board of Revenue about customs issues.

The gross domestic product (GDP) growth has been estimated at 7.50 per cent in the FY2023-2024, and the contribution of export is considered 12 per cent, it is mentioned in the target paper.

Senior commerce secretary Tapan Kanti Ghosh, Additional secretary Md. Abdur Rahim Khan, senior officials of the commerce ministry and different trade bodies' leaders were among others present at the event.

When contacted, eminent economist Prof Mustafizur Rahman said the target could be achievable provided the world economy sees a sign of recovery and there remains a demand pull.

"The target is not ambitious. It can be achieved if the present supply situation of utilities like power and energy is improved further," says Mr. Rahman, Distinguished Fellow of the Centre for Policy Dialogue (CPD).

Besides, other factors like improvement in ease of doing business and attracting foreign investments in export-oriented industries are also important for helping attain the target.

He also suggests paying focus more on non-RMG sector as except for the apparel and leather items, other exportables could not achieve their targets in the last fiscal.

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