Trade reforms help increase investment by 50%: Survey  

​​​​​Small-scale exporters increased their investments by around 50%, or Tk1.2 crore on an average, and hired new 79 employees thanks to numerous government measures aimed at facilitating trade, finds a study.          

The measures mainly include simplified trade and customs procedure, reduced trade regulatory cost and digitalisation and online services, according to the study conducted on 50 export-oriented apparel and other companies by Policy Research Institution (PRI) late-2021. 

The study stated a strong positive correlation with trade facilitation and investment. 

While revealing the findings at a roundtable in Dhaka on Wednesday, businessmen, however, said the field levels in many cases are not reflecting enough on the trade facilitation by the top policymakers.  

For example, knitwear leader Fazlul Hoque who held Dhaka Customs House responsible for missing foreign orders frequently.

"The Dhaka representative of a renowned foreign buyer had been regretting that fabric samples for export orders take more time to reach Bangladesh than the country's market peers," Fazlul Hoque, a former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told the programme.     

Quoting the brand representative, he said the buyer's head office sent the same sample to a number of sourcing countries. But as the customs clearance at Dhaka airport took too long, Bangladesh missed the order.       

"Bangladesh keeps missing a large number of export orders for the clearance-related delays at the airport. There might be good policies, but you wouldn't yield much until and unless the field levels change their attitude," he added.

Asif Ibrahim, a readymade garment exporter and former president of the Dhaka Chamber of Commerce and Industry (DCCI), said, "The revenue board is the linchpin for policy facilitation. If you want to make positive changes, you will have to make it happen by the revenue board."

"Often, they [customs officials] do not clear imported raw materials due to bonded warehouse HS code issues. Consequently, we miss the shipment deadline or have to opt for pricier air cargo," he added.    

Salman F Rahman, private industry and investment adviser to the prime minister, also agreed to some of the hassles the businessmen have to face.

"Though a remarkable change of mindset in the senior level, the field levels still remain a big challenge now. We need to ensure the change to trickle down to the grassroots," he added.

"Even in a time when the fashion industry is changing rapidly, if a new kind of sample [raw material or accessory] arrives at the port, the customs refuse to clear it as it is not on the list [bond licence list]. Though it is possible to include the item just within a day, I do not know why it takes too long," he said.

Salman F Rahman also shed light on the supply chain disruption due to recent geo-political issues, which were not a source of concern for businessmen even two to three years ago.    

According to the PRI survey, 23% of the companies observed no policy reform despite expanding their investments by Tk17 lakh on an average.  

Compared to India and Vietnam, the study notes that Bangladesh's performance in trading across borders, time to export-border and documentary compliance, cost of export, time to import, cost to import, enabling trade index, trade freedom and trade openness is remarkably poor.  

M Masrur Reaz, chairman at Policy Exchange Bangladesh, presented the keynote paper while PRI Chairman Zaidi Sattar presided over the programme.

PRI executive director Ahsan H Mansur, International Finance Corporation (IFC) Country Manager Martin Holtmann, Deputy Development Director of Foreign, Commonwealth and Development Office (FCDO) Duncan Overfield and other government and non-government officials also spoke at the programme.