Exporting RMG to 'select countries won't ensure sustainable dev'

Experts stress need to diversify export items, destinations

FE REPORT | Published: December 17, 2024 22:53:01

Economists on Tuesday said Bangladesh's sustainable development cannot be ensured by exporting cheap labour-dependent ready-made garment (RMG) to some select countries.
They said ensuring the diversification of export items and destinations, increasing domestic and foreign investments through administrative reforms and infrastructure development, and boosting skills through research and innovation are keys to advancing the economy to higher levels of development.
These remarks were made at a public lecture titled "World Trade and Bangladesh" and arranged by East West University at its Manzur Elahi Auditorium.
Dr Mohammed Farashuddin, former governor of the Bangladesh Bank and founding vice-chancellor of East West University, chaired the event. He stressed political stability to boost local and foreign investments.
"Foreign investors seek political and social stability, not just long-term governments, to invest. Without a national consensus and consistent policies, foreign direct investment will remain sporadic," he said.
Vietnam, India, and China thrive in regional trade, but Bangladesh lags behind, he said, adding, "The country's reliance on cheap labour in the RMG industry hindered diversification and skill development. As a result, the RMG sector's future may not extend beyond five to seven years."
The economist also said Bangladesh cannot progress without diversifying its production and exports. "Unfortunately, the country continues to send negative signals to investors."
Farashuddin said the Korean EPZ had remained stagnant for nearly 25 years, though efforts are now underway to resolve the issue. Similarly, the long-standing dispute with Grameenphone highlights the need for proactive conflict resolution, he said.
"We have repeatedly called for creative, non-partisan policies to improve governance in the banking sector and address issues like money laundering and tax evasion. Despite facing hostilities, we remain undeterred."
Farashuddin further said he had been denied access to Ganabhaban for the last six years and Bangabhaban for four years for expressing his opinion against corruption.
MG Quibria, former tenured professor at Morgan State University, emphasised the need for Bangladesh to diversify its export markets beyond Europe and the US, focusing on neighbouring countries like China and India.
Highlighting the importance of investing in health and education to develop skilled human resources, he urged the government to address critical issues in the oil, gas, electricity, and banking sectors to remain competitive in the global economy.
Quoting the World Bank, Farashuddin said Bangladesh's per capita income stands at $2,840, compared to $2,580 in India and $1,500 in Pakistan. "This progress cannot be overlooked."
While Bangladesh has developed its infrastructure, corruption and nepotism have likely inflated costs significantly, he said and stressed ensuring punishment for the corrupt.
He also emphasised there should be no forgiveness for terrorists and those fostering discrimination during the previous regime, saying they must be brought to justice.
"At the same time, systemic reforms are essential. However, reforms must be inclusive as exclusion will undermine their sustainability," added the economist.
Professor Dr Shams Rahman, vice-chancellor of East West University, delivered the welcome address at the event.
jahid.rn@gmail.com