Bangladesh sets $48bn export target in times of coronavirus crisis

The government has set a $48 billion export target for the financial year 2020-21 with the hope of a recovery from the global economic slowdown due to the coronavirus pandemic.

Senior Correspondentbdnews24.com
Published : 16 July 2020, 02:51 PM
Updated : 16 July 2020, 02:51 PM

The target is about 20 percent more than the export earnings but $6 billion less than the target of the fiscal year that ended on June 30.

Bangladesh earned $40.06 billion from exports in 2019-20 fiscal year, missing the target by nearly 25.3 percent and marking a 14.8 percent year-on-year drop as the pandemic led to a slump in global consumption and travel restrictions.

The new target envisages $41 billion earnings from goods export and $7 billion in services export. 

“I believe we will be able to achieve the target,” Commerce Minister Tipu Munshi said while announcing the goal at an online press conference on Thursday.

He said the government considered the export earnings and growth of the last fiscal year and FY 2018-19 while setting the target for the current fiscal year.

In 2018-19, Bangladesh earned around $46.9 billion from exports.

Bangladesh’s export earnings rebounded in June with a 2.5 percent year-on-year rise after slumping 18.19 percent in March, 82.85 percent in April and 61.87 percent in May this year after the outbreak began.

“It [June rebound] indicates that timely implementation of a proper policy can help achieve the target,” Munshi said.

He was optimistic that the global economy will bounce back into growth within 2021 and demand will jump in Europe and the US in the fourth quarter of 2020.

He also hoped that investment in Bangladesh will increase with a change in the global supply chain and diversification of Bangladesh’s readymade garment products. The IT sector will draw more local and foreign investment with the expansion of e-commerce, he said. 

Rubana Huq, the president of apparel exporters’ lobbying group BGMEA, said it will be better for them if the government extends the funding for exporting sectors to pay the workers for three more months to September.

Salman F Rahman, the prime minister’s adviser on private industries and investment, thinks the exporters may get the support as the government has Tk 180 billion after clearing Tk 80 billion from the Tk 300 billion coronavirus stimulus package.

“The government will consider raising the package if we see that the businesses need more working capital,” he added.

Salman also responded to Rubana’s comment that the banks were not supporting the small and medium enterprises. He said the banks hesitate to fund the SMEs because they are sceptical of getting their money back.

A credit insurance scheme by the Bangladesh Bank can solve the problem and the finance ministry said it would be able to arrange a Tk 10 billion scheme while the government held talks with the World Bank for Tk 40 billion for the scheme.       

Munshi said the government may even allow export of rawhide during Eid-ul-Azha to avert a disastrous season like the previous year when seasonal traders left rawhide on streets to rot after being offered lower price than they expected or failed to find customers.

Former FBCCI chief Shahfiul Islam Mohiuddin MP, the apex trade body’s incumbent President Sheikh Fazle Fahim, Vice-President Siddiqur Rahman, Syed Almas Kabir, president of Bangladesh Association of Software and Information Services, and Md Saiful Islam, president of Leather Goods Exporters Association, joined the press conference moderated by Commerce Secretary Jafar Uddin.