High time to diversify our export basket

We second the prime minister's call to private entrepreneurs on Tuesday to try and diversify Bangladesh's export items. For far too long, we have been overly reliant on our RMG export—accounting for more than 80 percent of our total exports—which puts our balance of payment (BOP) situation at risk, as any significant decline in RMG export could lead to huge BOP deficits. Thus, experts have been calling on the private sector for some time to take initiatives to diversify export items, and for the government to formulate policies that encourage export diversification.

Broadening the export product base, destination and quality can stabilise and expand export revenues and boost economic growth. That, in turn, can lead to the much-needed creation of more jobs. As Bangladesh graduates from the UN's list of Least Developed Countries (LDCs), the need for it to diversify its export basket becomes even more pressing. Many of the benefits it used to receive as an LDC will become redundant or unavailable after graduation. In order to make up for some of the potential losses, Bangladesh needs to formulate long-term plans on how to enhance its export basket.

Some of the measures, as previously highlighted by experts, could be for the government to provide low cost and easy access to finance, adequate policy support along with fiscal and non-fiscal incentives for non-garment export sectors, while ensuring equal treatment and sufficient skills development. When it comes to the RMG sector, Bangladesh, over the years, has enforced domestic regulations that are WTO-compliant and internationally acceptable. The same has to happen for other sectors if their products are to succeed in the international market. In line with that, the Bangladesh Standards and Testing Institution (BSTI) needs to be strengthened to ensure that local products face international standard testing to secure accreditation where necessary.

The private sector also has a big role to play here. Our businesses need to conduct proper market research to find out which products they can successfully export, as well as how they can diversify their export markets. They can also work with the government to try and find out which countries or group of countries Bangladesh should sign free trade agreements with, to increase trade and overall exports.