Saturday, April 27, 2024
Bangladesh earned $3.3 billion from service exports in the first half [July-December period] of this FY24, show provisional data from the Export Promotion Bureau (EPB).
This figure is 18.28 per cent lower year-on-year (YoY) compared to FY23, and 30.64 per cent lower than the commerce ministry’s H1 FY24 target. In H1 FY23, the country earned $4.04 billion from the services sector, and the ministry set a $4.76 billion earnings goal for H1 FY24.
Experts say Bangladesh, despite possessing a large population and numerous appealing tourist destinations, failed to cash in on the services sector due to the absence of effective policies, adequate planning, quality education, and a limited inclination to invest in the industry.
Though Bangladesh earned a few billion USD through service exports, the country’ imports of services far outpaces such exports, they added.
Commenting on the matter, Policy Research Institute (PRI) Executive Director Ahsan H Mansur said, “We buy a lot of services, but we cannot export as much.
“The export of services is actually more negative than the official data, as a large amount of money is going away through education, health, and remittances from foreign workers staying in the country.”
He added, “Around $15 billion such unrecorded money goes away every year, where nearly $5 billion are spent on medical treatment in India, Singapore, Thailand and other countries.
“Around, $2 billion – $3 billion are spent on education abroad, and at least $4 billion – $5 billion are spent annually on remittances sent to India, Pakistan and Sri Lanka by the workers staying in Bangladesh.”
Mansur then pointed out, “If we could stop these expenses, we would save a huge amount of money annually, which will make our economy stronger. In fact, there are many possibilities in services exports, which require necessary planning and policies.”
Transportation earnings dip 31.15%
The country earns a significant amount of foreign currency through transportation every year, and the government is providing cash incentive to promote this sector. As this sector has potential, local and foreign investors are investing in the industry.
The government is also increasing the number of air carriers gradually to cash in on the opportunity. Despite the facilities and high potential, the sector posted a 31.15 per cent YoY negative growth in the first half of FY24, earning $422 million.
Of this figure, $265 million came from sea transports, which is 25.65 per cent year-on-year lower compared to the H1 FY23. On the other hand, earnings from the air transports dropped by $150 million in the first half of FY24, which is 40.37 per cent lower YoY.
Travel earnings up 3.39%
Foreigners generally visit Bangladesh for three purposes – business, education and tourism – which are considered as travel earnings. In the first half of FY24, travel sector earnings jumped by 3.39 per cent year-on-year, earning $220 million, according to the EPB.
Of the amount, earnings from business services stood at only $0.59 million, which was $1.54 million in the same period of FY23.
Education related travel earnings jumped by 17.54 per cent YoY to $34.18 million in the H1 FY24, and the figure was $29 million in the same period of FY23. Earnings from foreign tourists rose by 2.37 per cent YoY to $27.61 million in the first half of FY24.
The amount stood at $26.97 million in the same period last FY.
Telecom, info exports slip 7.73%
Although the government fixed a $5 billion export target from information and communication technology in 2025, the sector earned only $322.28 million in the July-December period of FY24, which was 7.73 per cent year-on-year lower.
In the first half of FY24, telecommunication service sector earnings growth fell by 17.07 per cent YoY to $55 million. The amount was $66.36 million in the same period of FY23.
The EPB data shows that the computer service [software, data processing and consultancy] sector earned $267 million in the July-December period of FY24, which was 5.58 per cent lower compared to the same period of last FY.
Govt services exports down 24.02%
Foreign missions import goods and receive services from Bangladesh, which is considered as the government service exports. The country earned a decent amount of foreign currency from this particular sector.
EPB data shows that in the July-December period of FY24, earnings from the sector fell by 24.02 per cent year-on-year. During this period, the country earned $882 million, which was $1.16 billion in the same period of last FY.
The construction service exports went down by 14.68 per cent YoY to $379 million in the first half of this fiscal year, which was $444 million. In the first six month of FY24, earnings from research services went up by 11.44 per cent to $9 million.
