Home ›› 20 Mar 2023 ›› Front
The National Committee on Export is scheduled to determine strategies and action at its 11th meeting today, to combat the adversities for the export sector after Bangladesh’s graduation from least developed country (LDC) status.
Prime Minister Sheikh Hasina will preside over the meeting, set to be held at the Prime Minister’s Office, which will also discuss possible actions regarding the development of the export sector, according to commerce ministry sources.
Insiders say the committee will discuss implementing the action plans in the coming days, reducing the import duty at the reasonable level, establishing a bilateral trade mission, construction of warehouses in all ports, and boosting of investment in export-oriented industries.
According to commerce ministry sources, the meeting will address five agendas.
At the start of the meeting, members will review the overall export situation of the country and decide on an action plan to deal with the impact of the Russia-Ukraine war and the Covid-19 pandemic on the export sector.
The committee will also review the income and growth of the export sector in the last five years and adopt a new plan for the sector based on the review.
According to a draft agenda prepared by the commerce ministry, the meeting will also review the problems hindering exports, post-LDC situation challenges for the sector, and determine action plans to deal with the challenges.
The government formed the 44-member national committee last year to oversee the country’s exports as a whole, deal with export-related crises, and the challenges before and after the LDC graduation in 2026.
A total of 49 members including 11 ministers, 11 secretaries, the governor of the Bangladesh Bank, will join Monday’s meeting. In addition, top officials of the Bangladesh Investment Development Authority (Bida), Bangladesh Economic Zones Authority (Beza), Bangladesh Export Processing Zone Authority (Bepza), the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) will also attend the programme.
Reducing import duty
In order to deal with post-LDC challenges, the committee may decide to reduce import duty to a reasonable level, according to people familiar with the matter. Especially exportable products are expected to be given the opportunity to import raw materials and equipment free of duty. In the case of full-fledged export-oriented products, bonded warehouse facilities may be introduced in all sectors such as the garment industry.
Mohammad Hatem, executive president of the Bangladesh Knit Garment Producers and Exporters Association (BKMEA), said the garment sector traders will demand a reduction in source taxes and advance taxes at the meeting.
“There is still an opportunity to increase exports in this sector,” he said, adding that his organisation will call for increased support to the traders to get access into new markets.
According to a World Trade Organization report published in October 2021, Bangladesh will have to pay an additional $5,370 million a year in tariff after the LDC graduation as the tax rate on export goods will increase.
FTA, PTA signing
The national committee on export may decide on action plans aiming to increase the export of goods and services by signing Free Trade Agreements or Preferential Trade Agreement (PTA) with India, China, Japan, Korea, Singapore, Canada, Indonesia and Malaysia to create and expand export destinations, said sources.
Besides, the committee is expected to make a decision to set up a trade mission in Thailand, Mexico, Indonesia and Africa. Also, incentivising the production and export sectors in accordance with the SCM Agreement of the WTO will also be prioritised at the meeting.
Sources said the committee is expected to decide on the construction of cold storages and warehouses near the naval, aircraft and seaports to preserve vegetables, fruits, fish-meat and frozen food.
Furthermore, Monday’s meeting is expected to decide on action plans regarding ensuring compliance with international standards in laws related to labour rights and safe environment in factories’ environment and environmental laws and regulations will be decided. It also will identify laws and regulations inconsistent with WTO.
Stricter patent rules
The meeting will particularly emphasise on making the patent rules stricter for the pharmaceutical industry. Bangladesh being an LDC, local pharmaceutical companies do not have to pay for the patents of drugs. But that facility will no longer be available if the country graduates from its LDC status before 2033. Meaning, pharmaceutical companies will have to pay for the patents of drugs, which will result in increased prices. At the same time, the opportunity to get loans under simple conditions from international aid agencies will be reduced.
The national committee will decide on action plans regarding the amendment of the Patent Act 2022, the formulation of digital commerce law, the formulation of tariff policy and the implementation of the international patent law to make investment easier in the sector. In order to verify the quality of the product and increase the acceptance of the international market, the setting up of international quality labs will be set up and further to do in the certification.
Sources also said the meeting is expected to decide on action plans to encourage exports and production of new export products. The committee may also decide on making payment gateway services easier to facilitate exports and increase investment in the service sector.