Target 1% of China market for smooth LDC graduation: Experts 

If Bangladesh can capture 1% share of the Chinese market, its export earnings from China alone could be in the range between $20 billion and $25 billion a year –– a boost needed for the country's transition from the group of least developed countries (LDC).

This optimism was expressed on Saturday at a webinar that highlighted Bangladesh's untapped export potentials in the huge Chinese market.

Five items constituted around 76% of Bangladesh's total exports to China in the 2020-21 fiscal year – woven garments 21%, knitwear 19%, raw hides, skins and leather 9%, iron and steel 6%, and other vegetable textile fibres 21%. 

China granted duty-free access for 97% (8,256) of Bangladeshi products effective from 1 July 2020.

"It was expected that Bangladesh's exports to China would register a significant rise following China's granting duty-free market access for almost all of the Bangladeshi products. But that didn't happen due to a lack of diversity in the export basket, a lack of readiness according to the list of duty-free products, and a disruption in the global supply chain caused by the Covid19 pandemic," key-note speaker Dr Mahfuz Kabir said at the webinar. 

"The merchandise exports would be only $1.28 billion in FY26 and in an optimistic growth scenario (30% growth), it would be $2.53 billion by that time", added Dr Kabir, research director at the Bangladesh Institute of International and Strategic Studies (BIISS) .

The online seminar styled "Prospects of Bangladeshi Products in Chinese Market: How to Realise the Potential of Preferential Treatment" – was jointly organised by Bangladesh China Chamber of Commerce and Industry (BCCCI) and the Export Promotion Bureau (EPB).

"China has maintained its position as the world's largest manufacturing country. With a about $40 trillion domestic market, the country is also one of the largest importers in the world," said Dr Abu Eusuf, chairman of the Research and Policy Integration for Development (RAPID) and a professor at the Department of Development Studies at Dhaka University.

Mentioning that the next five years are very crucial for Bangladesh, Prof Eusuf said the Chinese market, where Bangladesh's presence is quite negligible, should be the target to ensure a smooth graduation from LDC status. 

In FY19, the value of bilateral trade between Bangladesh and China was about $15 billion, with Bangladesh's exports to China being less than $1 billion. 

The pandemic hit the worldwide trade flows. Consequently, both exports to and imports from China declined and the trade between the two countries stood at $12 billion in FY20. Exports to China declined by 28% to reach $600 million that year, while imports slumped by 15% to $11.4 billion.

In FY21, exports to China increased slightly to $680.65 million. At the same time, imports from the country rose to $13.55 billion.

Dr Nazneen Ahmed, country economist at the UNDP Dhaka office, told the event that Bangladesh should attach equal importance to attracting Chinese investment and increasing exports to the Chinese market in order to make its graduation to the developing status smooth.

She also mentioned that the Belt and Road Initiative can be used as a trump card during business negotiations with China. 

Mahbub Uz Zaman, Bangladesh's Ambassador to China, was the guest of honour at the webinar, presided over by Mahbubur Rahman, director general of the EPB. 

Mahbub Uz Zaman emphasised diversification of the country's export basket to cash in on most of the Bangladeshi products' duty free access to the Chinese market. 

The government is working to set up a permanent exhibition centre at Shanghai in China to display Bangladeshi products. 

Siban Shahana, research associate of the Bangladesh Institute of Development Studies (BIDS), moderated it.

BCCCI Joint Secretary Al Mamun Mridha said Bangladesh and China traditionally have been enjoying friendly bilateral relations for thousands of years. In recent years, the Bangladesh-China relations have been promoted onto a fast track of development. 

"The bilateral trade between the two countries almost takes place on a single way of traffic, which is tilting heavily towards China. And the trade gap keeps increasing as Bangladesh is failing to fully utilise the unbelievable preferential tariff package granted by China", he added. 

Mamun reassured that there are no trade barriers from the Chinese side. "They [China] are really welcoming Bangladeshi products and services in the Chinese market." 

"We have been informed by the EPB about the scarcity of the CO form but we have been assured by both the sides – the Bangladesh Embassy in China and the Chinese Embassy in Bangladesh – that there is no such crisis of the CO form as both the conventional and online systems are in place. 

"The commerce wing of both the embassies are doing their best to increase the bilateral trade and minimise difficulties. We [BCCCI] are also working hard in this regard. If any problems are faced by any exporter at any point of time, they can let us know about it. We will try our level best to solve the issue," he added.