Only 346 of Bangladesh's 1,393 non-readymade garment (non-RMG) export products earn more than US$1.0 million each annually, highlighting the limited expansion of most export items despite the country's diverse export basket, according to a recent study.
The study, titled "Competitiveness Study of Potential Private Sectors in Bangladesh" by the Research and Policy Integration for Development (RAPID), identified seven sectors with strong export potential where targeted interventions costing an estimated $140.43 million could generate economic benefits worth $216 million.
The sectors are agro-processed products, frozen fish, leather goods, footwear, handicrafts, information technology and IT-enabled services, and semiconductors.
The findings were presented at a consultation workshop on the draft development project proposal (DPP) for the second phase of the Export Competitiveness for Jobs (EC4J) project, held at CIRDAP in the capital on Tuesday.
Commerce Minister Khandakar Abdul Muktadir attended the event as chief guest, while Commerce Secretary Md Ataur Rahman Khan chaired the programme.
According to the study, Bangladesh's graduation from the least developed country (LDC) category will intensify competitive pressures through preference erosion, stricter market requirements and stronger competition in export destinations.
The study estimated that Bangladesh has untapped non-RMG export potential worth about $5.0 billion in major markets, including the United Kingdom, Germany, Spain, France, the United States, India and China.
Of the 1,393 non-RMG export products identified in the study, 1,165 are manufactured goods and 228 are agricultural products.
The study also highlighted a range of challenges, including anti-export policy bias stemming from high tariff protection, weak trade logistics, high transportation costs, trade facilitation bottlenecks, customs-related hurdles and ease-of-doing-business constraints.
According to the findings, a one-percentage-point reduction in transport costs could increase Bangladesh's export demand by 7.4 per cent, while full implementation of the WTO Trade Facilitation Agreement could reduce trade costs by 11-14 per cent.
Presenting the study, RAPID Chairman Dr M A Razzaque said Bangladesh's export concentration is four times higher than the average of developing countries and exceeds the average among LDCs.
"Export expansion and diversification must go hand in hand," he said.
Dr Razzaque noted that ready-made garments account for around 85 per cent of the country's export earnings and that export concentration deepened further between 2021 and 2024.
"Although Bangladesh has a large number of non-RMG products, most are not expanding. The EC4J project can help unlock their export potential," he added.
Speaking at the event, the commerce minister said Bangladesh had fulfilled the transitional requirements for LDC graduation, but the key challenge now was maintaining competitiveness in the global market and advancing to the next stage of development.
He stressed the need for skills development, research, innovation and technology adoption to strengthen the country's industrial base.
The minister said Bangladesh's export earnings could rise from the current $50-55 billion to $150 billion if a number of promising sectors receive targeted policy support, strategic planning, research and skilled workforce development.
He also emphasised the need to expedite project implementation, describing delays as one of the major weaknesses in the country's development efforts.
The commerce secretary said the government had initiated plans for an integrated project worth around Tk 30 billion to address post-graduation challenges and enhance export competitiveness.
Under the second phase of the project, sector-specific action plans will be formulated based on the practical needs and experiences of the private sector, he also said.
He added that the project will include initiatives aimed at the recovery, restructuring and capacity building of the export sector in line with national budget priorities.
munni_fe@yahoo.com
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