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As the report is exclusively related with the export trend of Bangladesh, so it will be ideal

to know something about the definition of export. Export is one of the most preferable

and conventional way to perform international business. In simplest word, export is

traditional buying and selling across the border of the country. In economics, an export is

any good or commodity, transported from one country to another country in a legitimate

fashion, typically for use in trade. Export is an important part of international trade. Its

counterpart is import. Export involve anything from transferring physical goods to

intangible services with a view to earning profit, sometimes it results from arbitrary

practice. According to the Encyclopedia of Britannica, export is To send or transport

goods abroad out of a customs territory; to sever them from the mass of things belonging

to one country with the intention of uniting them to the mass of things belonging to a

foreign country.

Brief idea about the Export of Bangladesh

Like many other third-world developing countries, Bangladesh relies quite heavily on

exports to provide for the needs of its densely populated nation. Today the economy of

Bangladesh has largely depends on the export position of the country. Before the

independence and after the independence the main source of budget fund came from the

export revenue and till now it is the major indicator of countries growth and economic

stability for its principle role in exchange rate determination and GDP. In over three

decades, Bangladesh has witnessed substantial growth in its export of goods and services.

The volume of export, the no of exporting countries and as well as the range of exporting

goods have widen substantially. Bangladesh has experienced not only a substantial

increase in the volume of exports but also important changes in the composition of those

exports; moving away from traditional items such as jute and jute products and towards

new manufactured products such as ready-made garments. Though the export of

Bangladesh is growing faster then many countries in South Asia. Its import over-lead the

effect of the export, so the trade deficit occurs, if we see the recent balance of payment of

Bangladesh it will be clear,

Table 1

Balance of Payments- current account [Annual Data]

 

2009-10

2010-11

% Changes 3 over 2

Items

July-June

July-June

1

2

3

4

Trade balance

-5155

-7328

 

Export f.o.b.(including EPZ)

16233

23008

41.74

Of which : Readymade garments

12497

17914

43.35

Import f.o.b (including EPZ)

-21388

-30336

41.84

Services

-1233

-2398

 

Receipts

2478

2570

3.71

Payments

-3711

-4968

33.87

Income

-1484

-1354

 

Receipts

52

119

 

Payments

-1536

-1473

 

Of which : Official interest payments

-215

-220

 

Current transfers

11596

12075

 

Official transfers

127

127

 

Private transfers

11469

11948

4.18

Of which : Workers' remittances

10987

11650

6.03

Source: Data collected from Bangladesh Bank website.

Notes – It is clearly reflected that exports receives are less than the import payments, so there is trade deficit occur, it is also important to notice that the percentage [%] increase in import is greater than the [%] increase in export.

Export Growth of Bang ladesh

1980 1981 1400000 1982 1983 1200000 1984 1000000 2008-09 1985 800000 1986 600000 1993 1987
1980
1981
1400000
1982
1983
1200000
1984
1000000
2008-09
1985
800000
1986
600000
1993
1987
400000
1988
200000
0
1989
1980
1990
1991

Source: Bangladesh Bureau of Statis tics

In FY 2011-12 (July-Januar y), Bangladesh earned USD 13924.6 million export from

that is 14.28 % more tha n that of the same period of the previous

fiscal year.

However, under the busi ness as usual scenario, despite the growth

during the

period of July 2011 to Febr uary 2012, it might be very difficult to maint ain a double

digit growth at the end of the fiscal year as the export from Banglade sh might be hindered.

Snapshot of export mar ket and product

Table 1

 

Trend in Export Trade (In product & market)

 
 

1972-73

2010-2011

Growth

No. of Product

25

180

620%

No. of Market

68

205

202%

Total Export

348 B

12500 B

3492%

Note – The table indicat es that the diversity of product and mar ket increase

earning and

significantly during 3 de cades indicating the growth in export

compatibility in the world

market.

Figure 1 Note – The situation su ggest the previous prime position of ju te

Figure 1

Note – The situation su ggest the previous prime position of ju te industry.

Immediately after the liber ation jute industry consist almost 90% of the total export

and at the same time majo r source of budget and foreign currency. Tea

goods were the associate cr iteria of export.

Bangladesh export by ma jor goods during 1982-83

and leather

Bangladesh export by ma jor goods during 1982-83 and leather leather chemical good rawjutes Tea others
leather chemical good rawjutes Tea others wovengarments frozen foods jutegoods
leather
chemical good
rawjutes
Tea
others
wovengarments
frozen foods
jutegoods

Figure 2

Note – within this decade ’s jute industry hold their no-1 position b ut there is a

negative growth is experien ced in export of jute. Woven garments intro duce as a

potential criteria of export. Positive growth experienced in the industry of tea,

leather and frozen foods.

in the industry of tea, leather and frozen foods. Figure 3 Note- during year 82-92 a

Figure 3

Note- during year 82-92 a major decline in the export of jute industry. The export

share decline 89% in 73 from around 20% in 1992. This is due to the poor control

and managerial efficiency of the jute industry. Ignoring to transfer it to the private

sector rather than operating with loss is one of the prime factors destroying this

sector, although the demand of the jute was constant globally.

Figure 4 Bangladesh as it holds almost 70% of the export amount of the country

Figure 4

Bangladesh

as it holds almost 70% of the export amount of the country and a maj or source of

foreign currency. Jute in dustry looses its previous position and be come minor

criteria. Tea and leather ex port also experience negative growth.

Note- woven garments and knitwear become the major export good for

Bangladesh export by ma jor goods during 2010-2011

Raw Jute

2%

Ha ndicraft Others

0%

Fish, shrimp

s

11%
11%

0%

Tea

0%

Furnace 3% Oil

0%

Fertilizer

Leather

3%

Jute Manufac

4%

Readymade

Garment

77%

Figure 5

Leather 3% Jute Manufac 4% Readymade Garment 77% Figure 5 Readymade G arment Jute Manufac Fish,

Readymade G arment Jute Manufac Fish, shrimps Leather Furnace Oil Raw Jute Handicraft Tea Fertilizer Others

Note- During 2010-2011, re adymade garments (woven garments& knitw

ar) retain its

position and as it holds alm ost 76% of the export amount of the country

and a major

source of foreign currency.

Jute and Leather industry decline compare to

its previous

position and become minor

growth.

Export direction [count try wise export]

In this portion we have disc ussed the major importing countries from Ban gladesh or in

The export of tea and fertilizer ex perience zero

criteria.

other word major exporting c ountries of Bangladesh.

Country wise export volume

3000 0 2000 0 bdt crore 1000 0 0 2010-11 2009-1 0 2008-09 USA Germany
3000
0
2000
0
bdt crore
1000
0
0
2010-11
2009-1 0
2008-09
USA
Germany
UK
Franc e
Netherlands
Italy
Canada
Spain
Turkey
Belgium
India

Chart 1

Note- As regard the destina tion pattern of exports, the U.S.A. was the mo st prominent

during the year under review

the previous

two years respectively. Duri ng 2010-11,The principal items of export to th e U.S.A were

readymade garments (Tk.240 37.10 crore), fish, shrimps & prawns (Tk.695.9 0 crore), jute

as compared to Tk.19674.6 c rore (22.5%) and Tk. 20634.3 crore (24.4%) in

buyer which bought goods w orth Tk. 26829 crore (21

5%)

manufactures (Tk.113.9 cro re), leather and leather manufactures (Tk.64.5 0 crore) and

raw jute (Tk. 21.60 crore) . The second largest buyer of Bangladesh i goods was

Germany. They purchased g oods worth. 19455.7 Crore (15.6%) during th e year under

review as compared to Tk. 1 2412.2 crore (14.2%) and Tk. 12647.5 crore (1 4.9%) during

2009-2010 and 2008-2009 re spctively. The next important trading partner was the U.K.

Export earnings from the U.K. amounted to Taka. 11395.2 crore (9.1%) during the year

2010-2011 as compared to Tk. 8363.3 crore ( 9.5%) and Tk. 8240.3 crore ( 9.8%) during

the years 2009-2010 and 2008-2009 respectively. France purchased goods worth Tk.

9368.1 crore (7.5%) during the year under review. The total export receipts from during

2009-2010 and 2008-2009 were Tk. 6117 crore (7%) and T k. 6295.7 crore (7.5%)

respectively.Netherlands, Italy, Canada, Spain, Turkey, Belgium, and India followed in

descending order of magnitude in respect of our export earnings and accounted for Tk.

7026.7 crore (5.6%), Tk. 5036 crore (4%), Tk.4994.2 crore (3.9%), Tk. 4503.2 crore

(3.6%), Tk. 4310.6 crore (3.4%), Tk. 3383.3 crore (2.7%) and Tk. 3321.3 crore (2.6%)

during 2010-2011 respectively.

Export share to GDP

The contribution of the export sector to Bangladesh’s GDP has been gradually increasing

over the years. Export share in GDP was 5.45 percent in FY 1990-91 while this share

reached at 20.07 percent in FY 2010-11, reflecting an increase of 15.02 percent in GDP

contribution within twenty years. This contribution might increase further in FY 2011-12,

FY 2012-13 and FY 2013-14 at 21.48, 21.67 and 21.85 percent respectively

The further growth are reflected in the data table,

 

90-91

00-01

02-03

03-04

04-05

05-06

2010-11

Export

1718

6467.3

5835.7

7416

8679.4

10315

22928.2

US$-ml

Growth

20

276.4

11.8

29.4

21.9

29.9

122.3

Rate

Export

7.3

13.67

11.2

13.1

14.37

16.63

20.47

% of GDP

Recommendation:

Although Bangladesh has achieved a substantial growth rate in export, the commodity

concentration and also the market concentration has been the key concern for government

for the retention of that growth rate. Because the export products and market are not

diversified and export can be diminish with the decrease in need of certain product or as a

result of higher competition. So,

This excessive dependence on a few export items and markets reflects the

vulnerability of Bangladesh’s external sector. So export diversification and

market diversification continue to remain major challenges.

Domestic supply side constraints are major reasons for a narrow export base. To

realize Bangladesh’s potential export opportunities, supply-side constraints need

to be addressed immediately. Supply-side bottlenecks relate to infrastructure,

communications, ports, capacity in implementing export incentive regime,

functioning of export-related institutions, and proper governance.

Appropriate macroeconomic policies including price stability and an appropriate

exchange rate must be ensured. Bangladesh Bank, the central bank of Bangladesh,

must take appropriate steps independently in this regard. The government must

also contribute by playing a helping role to maintain the price stability. Prudent

fiscal policy, for example, would be helpful in this regard.

Adequate infrastructure must be built to facilitate the country’s exports. Sufficient

investments, both from internal and external sources, are vital to improve the

existing infrastructure facilities. Foreign direct investment can play a contributory

role in this regard. The government must create a favorable investment

environment by improving law and order situation and controlling corruption.

Proper quality of exportable items must be maintained to meet foreign demand. Better education and training to the workers and managers in the export industries,

establishment of more technical schools and colleges, import of improved technology

for export industries, and closed and regular product supervision can ensure the

quality of exportable items.

Close partnership between the Government and the business community is

crucial. Honest businessmen, who are really contributing to the economy, deserve

all kinds of cooperation from the government. A clear and constructive

understanding between these two groups can undoubtedly improve the country’s

export performance.

The government and the business community must work hard for export and

market diversification. Efforts must be made to increase the export of traditional

items. Frequent export fairs through the foreign missions can be helpful to

introduce new exportable items to foreign buyers. The search for new markets for

Bangladesh’s exports should be a continuous task for both the government and

businessmen.

Conclusion:

Despite the structural limitations of the Bangladesh economy, the export sector

performed well throughout the 1990s. The export-GDP ratio, import –GDP ratio and

trade-GDP ratio have increased over the years. The growth rate of export- GDP ratio of

Bangladesh was the highest during 1980-2002 among the SAARC countries. However,

the balance of trade of Bangladesh remained in deficit.

The striking features for the Bangladesh’s exports are commodity and market

concentration. This is the main concern. To address it, there is no alternative but to

initiate diversification and quality improvements. New markets for the country’s exports

must also be explored to secure more stability in the export sector. To reduce the

dependence on imported inputs for the readymade garments and knitwear industries,

Bangladesh must make massive investments in both yarn and fabric manufactures. This

would create forward and backward linkages; and current trade deficit would improve.