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Introduction
Foreign
trade is of vital importance to the economic development of
Bangladesh. The country's import needs are large and the
imperative to increase exports is immediate. In order to finance
those imports and also to reduce the country's dependence on
foreign aid grants, the government, since liberation, has been
trying to enhance foreign exchange earnings through planned and
increased exports. The significance of foreign trade to the
economy is manifest in a number of facts and figures.
In
1991-92, foreign trade's contribution to government revenue was
more than 37 percent; export-oriented industries' contribution
to industrial value-addition was 56 percent; export industries'
share of employment in the manufacturing sector was 60 percent,
and the growth of export earnings was 16.09 percent. During the
last decade export earnings at current dollar prices increased
by 14 percent per annum.
At
present, major exports are raw jute, jute goods, tea, leather,
frozen fish and read-made garments, while major imports are
capital goods, food grains, petroleum and oil, yarn and
textiles.
Export
Earnings
Export
growth is one of the corner stones of development strategy of
the present government. In 1991 total export earning was US$
1,718 million; it increased by over 47 percent and was more than
US$ 2,533 million in 1993-94; during 1994-95 fiscal year the
export target has been fixed at US$ 3,100 million. This along
with higher remittances from abroad has helped reduce the
country's debt service ratio from over 20 percent in I991, to
less than 13 percent in the fiscal year 1993-94. The continued
improvement in export trade was accompanied by the benign
structural shift in composition of exports with non traditional
items contributing increasingly higher share of total exports.
The share of non-traditional items in the country's total
exports which stood at 75 percent increased to 86. In respect of
economic classification of export commodities, the primary as
well as the manufactured items and export commodities recorded a
balanced growth with their respective shares in total exports
remaining more or less at the same levels. Recently a trend of
increased price of raw jute is being observed in the
international market. The government is determmed that
restructuring of jute manufacturing industry should move apace
for much needed viability and external competitiveness. There is
need for requisite technological inputs to adequately exploit
the potentials of this fibre. New opportunities have emerged to
produce pulp from jute through chemical process. Steps are
underway for production of 25,000 MT of pulp for industrial
grade paper during the current jute season.
Total
import payments increased by 21 percent from US$ 3,470 million in 1990-91
to US$4,191 million in 1993-94. Structure of import now reflects a
significant pick up of overall economic activities. Imports of
intermediate goods, industrial raw materials and capital and miscellaneous
machinery recorded increases during 1993-94 fiscal year. Industrial raw
materials which constituted 29 percent of total imports in 1990-91
increase to over 38 percent in 1993-94.
Despite
satisfactory performance of the export sector the balance of trade
experienced some fluctuations owing mainly to fluctuations in the import
levels. However the trade gap which had stood at US$ 1,800 million in
1990-91 has declined to US$ 1,650 million in 1993-94. Export earnings as
percentage to import payment which was about 50 percent in 1990-91,
reached over 60 percent in 1993-94.
Strategies
The
government has taken following strategie to boost export:
·
Simplification of export procedures and strengthening export-led
co-operation through reducing regulatory role of the government;
·
Rationalization of the value of Taka to make the export trade more
attractive;
·
Creation of an Export Promotion Fund (EPF) for strengthening the export
activities;
·
Encouraging establishment of backward linkage industries through
utilization of locally available raw materials;
·
Participation in international trade fairs, single country exhibitions and
specialized fairs and sending business delegations abroad for expansion
and consolidation of existing markets and creation of new markets;
·
Expediting BMRE of existing wet-blue producing tanneries and converting
them into finished leather producing and exporting units;
·
Accelerating expansion of improved traditional and semi-intensive methods
of shrimp cultivation for enhancing export off
·
Allowing import of high quality foundation-tea for blending and
establishing the brand name of Bangladesh tea through marketing;
·
Taking measures to improve quality, increase production and expand market
of exportable agricultural products;
·
Undertaking activities for increasing export of computer software,
engineering consultancy and services;
·
Expediting steps for export of labour intensive electronic and engineering
products keeping in view the market requirements in the USA and other
developed countries;
·
Promoting export of electronic components and engineering items to various
countries;
·
Providing appropriate financing facilities for production of components of
electronic and engineering items for marketing on consignment basis;
·
Expanding the list of products under crash programme beyond 4 products
(toys, luggage and fashion items electronic and leather goods) and
including 8 more items such as diamond cutting and polishing, jewelleries
making, stationery articles, silk, gift items, cut artificial flower &
orchid, vegetables, engineering consultancy & services for export;
·
Organizing commodity-wise trade fairs of international standard in the
country;
·
Developing and expanding infrastructural facilities for export trade; and
·
Creating product-development councils for important products.
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General Section
