Lack of basic land, air and sea connectivity in conjunction with a plethora of governmental complications is discouraging the prospects of boosting bilateral trade between Myanmar and Bangladesh. The border trade between the two countries is still low.
The transportation and communication infrastructure is very meagre between Myanmar and Bangladesh despite their geographic nearness. Bangladesh still has not been able to resume the air linkage since it was suspended in 2007 due to commercial incompetence on both sides. This is gravely hurting the prospects of better trade.
During Prime Minister Sheikh Hasina’s visit to Myanmar in 2011, the two countries agreed to develop their land, sea and air connectivity. As a result, Bangladesh cabinet approved a proposal in 2013 for inking a deal with its Southeastern neighbour to resume direct flight service, which will allow seven passenger and four cargo flights to fly every week between Dhaka and Yangon – Myanmar’s largest city and economic hub.
However, according to its 2014 press briefing, Biman Bangladesh Airlines, the national flag carrier, has admitted that it is not in a financial position to start a new route which will take some time to become profitable despite the agreement signed and finalised. Moreover, recent analysis suggests that airlines from Myanmar are also hesitant about getting into a financially-risky venture.
Besides air linkage, both nations have not been able to develop any reliable road network in the bordering areas. Currently, Bangladesh does not even have any land links with Myanmar’s major cities. In order to get access to the greater Asia-Pacific market, Bangladesh has to establish road links with Myanmar as it borders China, Thailand and Laos. If completed, the proposed Asian Highway will hugely boost the road connectivity in the region. Bangladesh also needs to allow Myanmar’s water vessels into its inland waterways and vice versa to strengthen the maritime connectivity. Additionally, the government has to establish and regulate wholesale markets and warehouses along the border to minimise logistical difficulties.
During the 6th Joint Trade Commission (JTC) meeting between Myanmar and Bangladesh held in Dhaka in November 2012, both parties agreed to enhance the volume of bilateral trade to $500 million from around $100 million annually. Unfortunately, the bilateral trade amounted to only about $79 million in FY 2013-2014.
However, the volume of unofficial trade between the two neighbours is about $300 million per year, according to BGB sources. Beside the formal trade, a large quantity of petroleum products, fertilisers, agricultural goods, and automobile parts are also smuggled into Myanmar. Illegal trade is proliferating because the payment system is highly complicated due to the absence of formal banking channels in place. Furthermore, existing sanctions against Myanmar banks also contribute to this growing concern.
In the past, the trade volume between Bangladesh and Myanmar could not reach a satisfactory level because of former Western sanctions and the economic isolation of Myanmar, but the doors for business seem to have opened again. The opportunities are huge in Myanmar as it’s a very resourceful country – it has abundant rice, pulse, beans, timber, oil, gas and jade. The biggest advantage for Bangladesh is its geographic location. Many of its products are globally distinguished for their quality such as RMG, leather and pharmaceuticals.
If the businesspeople of the two countries can further their ties and the two governments can ease the existing barriers then bilateral trade will definitely increase at a very faster rate. Bangladeshi entrepreneurs can approach their counterparts in Myanmar for investments in raw materials which can turn into furnished goods inside Bangladeshi factories. There is a huge trade prospect for both countries. The whole world is trying to establish their presence in Myanmar now. As a next-door neighbour, Bangladesh should not just sit idle and let the opportunities fly past.
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