Free Trade Agreement (FTA) of Bangladesh and its Roadmap (2021-Future)

[Joel Ahmed]

https://www.dhakatribune.com/business/2021/12/15/bangladesh-nepal-bilateral-pta-at-final-stage

Bangladesh-Nepal bilateral PTA at final stage

 Tribune Report

 Published at 08:56 pm December 15th, 2021

The PTA will be signed after getting final nod from the Nepalese side

A preferential trade agreement (PTA) between Bangladesh and Nepal is at the final stage, said commerce secretary Tapan Kanti Ghosh.

He said as chief guest at the business networking meeting between the Dhaka Chamber of Commerce and Industry (DCCI) and the visiting business delegation from Confederation of Nepalese Industries (CNI), Nepal held at DCCI in the city on Tuesday, said a press release.

DCCI President Rizwan Rahman chaired the meeting. Meanwhile, a memorandum of cooperation (MoC) between DCCI and CNI was also signed during the meeting.

Rahman and President of CNI Vishnu Kumar Agarwal signed the document on behalf of their respective organizations.

Ghosh expressed the hope that soon the PTA will be signed after getting final nod from the Nepalese side.

Bangladesh is a very big market with a huge consumer base especially in the FMCG sector and Bangladesh has to import a large quantity of consumer items like edible oil, lentil, sugar etc, he added.

He urged Nepali businessmen to leverage this opportunity. 

He also termed that the memorandum of cooperation signed between DCCI and CNI is a milestone for both-way trade and commerce.

DCCI President Rizwan Rahman in his opening remarks said that both nations work on common interests at various international forums including SAARC, BIMSTEC, WTO that bolster our diplomatic and economic friendship.

The bilateral trade is around $73.47 million in FY 2020-21 having positive trade balance for Bangladesh, he added.

RMG, pharmaceuticals, agro-food processing, jute goods, ITES, light engineering, electronics have great investment and trade potentials as Nepal is one of the preferred investment destinations for Bangladesh, he said. 

"Nepal can invest in our agro-processing tourism, financial sectors and SEZs," he added.

Leader of the Nepalese delegation and President of CNI Vishnu Kumar Agarwal said agriculture, tourism, energy, education and IT sector are some of the potential sectors where entrepreneurs of both the countries can be benefitted. 

He said Nepal is now giving priorities to its transformation from trading led economy to manufacturing based economy.

So, this move will create an immense opportunity for huge investments. Moreover, exchange of delegation will foster bilateral trade, he said.

Vice-President of CNI Nirvana Chaudhary said that they have already invested in Bangladesh in the FMCG industry and they have a plan to invest in the beverage and hospitality sector in future. 

Later, Senior Vice President NKA Mobin, DCCI Vice President Monowar Hossain and members of the Board of Directors of DCCI and CNI were also present.

[Joel Ahmed]

https://www.dhakatribune.com/business/2021/12/21/cpa-signs-deal-with-ranong-port-to-boost-bd-thai-trade

CPA signs deal with Ranong port to boost BD-Thai trade

 Tribune Report

 Published at 08:06 pm December 21st, 2021

The MoU would encourage the business communities of both countries to further explore trade and investment opportunities

Bangladesh and Thailand are set to enhance maritime connectivity between the two countries in the Bay of Bengal in a bid to increase bilateral trade.

An MoU was signed in this regard virtually on Monday evening between the Port Authority of Thailand (Ranong Port) and the Chittagong Port Authority of Bangladesh.

Md Zafar Alam, member (Admin and Planning), the Chittagong Port authority and Lt JG Dr Chamnan Chairith, R T N from the Port authority of Thailand signed the MoU on behalf of their respective authorities.

The MoU would encourage the business communities of both countries to further explore trade and investment opportunities. 

Additionally, both the port authorities would be benefitted through the exchange of information and cooperation in port management, operations, information technology, communication, port connectivity, coastal shipping, port-related industry and investment promotion, said a press release.

The bilateral trade between Bangladesh and Thailand stood at $1.2 billion with Thailand enjoying trade surplus.

It is hoped that coastal shipping, under the MoU, between the Ranong port and the Chittagong port of Bangladesh would immensely contribute to further strengthening bilateral trade through reducing the transportation time and cost for trade between Thailand and Bangladesh.

The signing of the MoU is also expected to further strengthen the existing excellent relations between the two countries.

Secretary, Ministry of Shipping, Ambassador of Bangladesh to Thailand, Director General (South East Asia) of the Ministry of Foreign Affairs and Chairman, Chittagong Port Authority were present from Bangladesh side while Ambassador of the Kingdom of Thailand in Bangladesh, Assistant Director-General, Asset Management and Business Development, Port Authority of Thailand were present from the Thai side during the virtual signing ceremony.

 

[Joel Ahmed]

https://www.dhakatribune.com/business/2021/12/30/bangladesh-south-korea-trade-to-reach-record-high-in-2022

Bangladesh-South Korea trade to reach record high in 2022

Bangladesh’s export increased by 35.8% to $498 million, from $393 million in 2020

 

By Tribune Report

December 30, 2021 6:34 PM

Bilateral trade volume between Bangladesh and South Korea is expected to reach a record high in the year 2022.

Between January and November this year, the trade volume recorded $2.014 billion, a 54.6% increase from the same period of last year which was $1.303 billion, according to the statistics by the Korea Trade Association and a press release issued by the Embassy of the Korean Republic.

Bangladesh’s export increased by 35.8% to $498 million, from $393 million in 2020.

South Korea’s export to Bangladesh rose by 61.9% with $1.51 billion from $1.033 billion in 2020.

Bilateral trade has been stagnant at a level below $1.6 billion for almost a decade after it peaked at $1.872 billion in 2011. 

Bangladesh’s export to Korea, which reached over $100 million in 2007 and $200 million in 2011, remained stagnant after it reached over $300 million in 2013. 

Despite the Covid-19 pandemic, Bangladesh’s export to Korea, however, crossed over $400 million in 2019 and recorded $393 million in 2020. It is expected to go over $500 million by the end of this year, said a press release

The main export items of Bangladesh to Korea are garments, sports and leisure items and bronze scraps. 

Garment exports, which account for 81% of total export to Korea, increased by 32.4% than the previous year with $442 million, while sports and leisure items skyrocketed by 92% with $303 million. Export of bronze scrap rose by 175% with $9.14 million.

Korea’s export to Bangladesh, which peaked in 2011 at $1.63 billion has decreased to approximately $1.2 billion for many years and further deepened to $1.03 billion in 2020. 

It might be even possible to surpass the level of 2011 by the end of this year. Major export items of Korea to Bangladesh are machinery, petrochemical product, steel and pesticides. 

Export of machinery rose by 107% to $297 million, which reflects the continued growth of Bangladesh’s manufacturing sector. 

Petrochemical products increased by 64.2% with $279 million. Steel export grew by 45.7% with $190 million and pesticides by 68% with $78 million.

South Korean Ambassador Lee Jang-keun said that the year 2022 will mark a momentous turning point in the bilateral trade between the two countries overcoming the challenges of the Covid-19 pandemic.

He expects the bilateral cooperation will be further strengthened in the coming years. 

Lee Jang-keun hopes that the Bangladesh business sector takes advantage of the preferential trade policy of Korea to Bangladesh, which provides duty and quota-free access to the Korean market by 95% of the product since 2008.

[Joel Ahmed]

https://today.thefinancialexpress.com.bd/first-page/thailand-offers-dfqf-facility-to-bd-until-2026-1640711451

Thailand offers DFQF facility to BD until 2026

JTC meet in Dhaka in Jan

 REZAUL KARIM |  December 29, 2021 00:00:00

Thailand has decided to offer the duty-free, quota-free (DFQF) facility for Bangladeshi products in its market until 2026 to enhance bilateral trade volume, officials said.

The previous such arrangement between the countries expired on December 31, 2020.

The Thai Embassy in Dhaka has recently conveyed its government's latest decision on the DFQF scheme to the Ministry of Commerce (MoC).

The Southeast Asian country has announced to extend the facility for the Least Developed Countries (LDCs), including Bangladesh, until December 2026, a senior official of the MoC said.

Meanwhile, the sixth Joint Trade Committee (JTC) meeting between the two countries is supposed to be held in Dhaka in January next.

"The most important platform for bilateral trade negotiations between Bangladesh and Thailand is the JTC," a high official said, adding that the fifth JTC meeting was held in Bangkok on January 08, 2020.

The meeting discussed the renewal of DFQF facility, as it was due to expire on December 31, 2020, according to a document of the Bangladesh mission in Thailand.

The Bangladesh embassy in the meantime continued its efforts for bilateral engagements through multi-pronged approaches.

But the Thai authority concerned informed Dhaka that it would take time, as the scheme had involvement of 46 countries. Thailand also suggested signing a bilateral free trade agreement (FTA) for a quick solution in this connection.

Bilateral trade between Bangladesh and Thailand dropped to US$910.05 million in 2020 from $1,067.90 million in 2019.

In 2019, Bangladesh utilised benefits of the DFQF scheme to the tune of $541,000. In 2019, the volume of Thailand's exports to Bangladesh amounted to $987.16 million, while that of Bangladesh to Thailand was $80.74 million.

Bangladesh exports products like knitwear, household articles, sewing thread, and jute rope and bags to the country.

Bangladesh would graduate from the least-developed country (LDC) status in 2026.

"We hope that the Thai government will continue providing the DFQF market access to Bangladesh even after the country's graduation in 2026," a high official said.

After expiring the DFQF facility in 2020, Bangladeshi exports to the Southeast Asian country faced setback, he added.

[email protected]

[Joel Ahmed]

https://www.business-standard.com/article/economy-policy/bangladesh-may-become-india-s-fourth-largest-export-destination-in-fy22-121122800026_1.html

Bangladesh may become India's fourth largest export destination in FY22

Bangladesh's growth stems largely from its success as an exporter of garments, which account for around 80 per cent of its total exports

Topics
Bangladesh | Export | garment exports

Asit Ranjan Mishra  |  New Delhi Last Updated at December 28, 2021 00:48 IST

Bangladesh may become India’s fourth largest export destination in FY22, jumping five places in two years. This comes as the economic boom of the eastern neighbour continues to fuel India’s exports growth.

According to disaggregated data available till October, during the first seven months of FY22, exports to Bangladesh grew 81 per cent over the same period in the preceding year to $7.7 billion. This makes it India’s fourth largest export market behind the US, UAE and China.

If the trend continues, Bangladesh will only better its rank in India’s export profile from last year’s 5th position when it surprised analysts by jumping from 9th rank in FY20.

Bangladesh has been an economic miracle in South Asia with its unprecedented transformation over the past decade and may even surpass India in terms of per capita income.

Bangladesh’s growth stems largely from its success as an exporter of garments, which account for around 80 per cent of its total exports. Remittances from overseas amount to over 6 per cent of GDP.

The major items exported to Bangladesh by India during the April-October 2021 period include cotton ($2.1 billion), cereals ($1.3 billion), electricity and fuel ($0.6 billion), vehicle parts ($0.5 billion) and machinery and mechanical appliances ($0.4 billion).

India and Bangladesh are currently undertaking a joint study on the prospects of entering into a bilateral comprehensive economic partnership agreement (CEPA).

The India-Bangladesh CEO Forum, which was launched in December 2020 to provide policy-level inputs in various areas of trade and investment and facilitate exchanges among business communities, is expected to meet soon to further deepen trade and economic ties.

In a joint statement after the virtual summit between Prime Minister Narendra Modi and his Bangladesh counterpart Sheikh Hasina, both sides emphasised the need to address issues of non-tariff barriers and trade facilitation. They include port restrictions, procedural bottlenecks and quarantine restrictions.

“The Bangladesh side requested that as India’s export of essential commodities is an important factor influencing its domestic market, any amendments in the

export-import policy of India should be conveyed in advance. The Indian side took note of this request,” the joint statement said.

Bangladesh avoided a recession in FY21, growing at 3.5 per cent unlike India whose economy contracted 7.3 per cent during the period. The economy of Bangladesh is expected to grow at 5.5 per cent in FY22 and 6.8 per cent in FY23, according to the Asian Development Bank (ADB).

ADB, in its Asian Development Outlook released in September, said excluding petroleum, imports (overall) by Bangladesh increased by 14.5 per cent in FY21.

This reflects the solid economic advance. Interme­diates for the garment industry rose by 8 per cent, while there were double-digit increases in import of other intermediates, consumer products and capital goods.

“Imports are expected to grow by 5 per cent from a high base. As the readymade garments industry continues robust growth, its substantial input requirements will expand. An increase in the volume of import of petroleum and petroleum products is expected, but with a more moderate price adjustment than in FY21. Accelerated implementation of large infrastructure projects and robust real estate development are expected to boost import of construction, capital equipment and other materials. Meanwhile, foodgrain imports will fall,” it added.

[Joel Ahmed]

https://www.tbsnews.net/features/panorama/bangladesh-joining-rcep-will-be-bold-epoch-making-step-303256

Abul Kasem Khan

16 September, 2021, 12:00 pm

Last modified: 16 September, 2021, 12:11 pm

Bangladesh joining the RCEP will be a bold, epoch-making step

Bangladesh could benefit a lot from RCEP, especially since the region’s GDP amounts to USD 26.2 trillion - meaning it controls almost 30% of the global GDP. This partnership is likely to have benefits far greater than just for the country’s economy

The Regional Comprehensive Economic Partnership (RCEP) is a historic economic partnership, and it will transcend into a game-changing trade partnership in future. It will be a significant and bold decision if Bangladesh joins this group. 

The 15 countries in this group are among the fastest growing economies of the world and include some of the world's largest economies such as China, Japan and South Korea. The RCEP also includes all 10 countries of the ASEAN, plus Australia and New Zealand. 

There was always a discussion in Bangladesh on how to become a part of the ASEAN block. Now, if Bangladesh can join the RCEP, Dhaka will enter an even larger group than the ASEAN, comprising the ASEAN block. 

Since the 2000s, the Asia Pacific region has witnessed the rapid rise of China, creating a new economic landscape in the region, supported by the ASEAN countries. The region's GDP amounts to USD 26.2 trillion. It means the region controls almost 30% of the global GDP. Countries like Bangladesh, and Vietnam are also growing rapidly, transforming into major economic growth centers as well. 

The successful formation of the RCEP will truly establish the 21st century as the Asian Century.

So, the question is, how will Bangladesh benefit by joining this group? 

Benefits will come in many forms, as long as the partnership with the block is an effective one. And, the association of so many countries is a strong indication that this new partnership will be an effective one indeed. 

However, the scope to maximise the opportunities will greatly depend on the ability to design the right strategies and make timely decisions. For Bangladesh, like other countries in the group, RCEP will increase market access, create investors' confidence and also improve efficiency on the supply side. 

It should be kept in mind that there will also be multidimensional challenges. The products and services of other member countries will also get access to our internal market, of which the impact assessment is unknown to us. We need to make the required improvements and adjustments. 

But, usually, it is seen that the developed economies incur the biggest gains due to larger product basket and industrial diversification - therefore, in the short term, countries like China, Japan and South Korea will benefit the most. 

According to a CNBC report, China will gain around $100 billion, Japan $46 billion, South Korea $23 billion and the ASEAN bloc $19 billion. Indicating that everyone is benefitting from the partnership. How much Bangladesh will gain, still needs to be estimated. But it is good to know that there are mechanisms within the group creating a level playing field for all participating countries, given the economic advancement of each country.  

Today, Bangladesh is the 36th largest economy in the world. In less than 10 years, according to HSBC, Bangladesh will emerge as the 26th largest economy in the world. Meanwhile, Dhaka Chamber of Commerce and Industry (DCCI) in 2010 projected Bangladesh will become the 30th largest economy by the year 2030. 

Numerous other reports forecasted the economic progress and prosperity of Bangladesh. 

Bangladesh has been growing consistently, supported by strong macroeconomic fundamentals, political stability and demographic dividend adds to our strength. In fact, demographic dividend is the biggest advantage for Bangladesh. 

Almost 56% of our population are aged between 18 to 40 years. Bangladesh has the 8th largest workforce in the world supported by a vibrant and growing GDP of USD 320 billion, with rising disposable income levels - this demonstrates the future capabilities of the country. 

Today, to accelerate our growth and become an economic powerhouse, such partnerships will propel our advancements further, and since we are already moving towards a developing country status, we will have to enter such arrangements given that we will be giving up many benefits that LDC status country receives.

To create opportunities, we must have a strategic plan with short term, mid-term and long-term goals and objectives. As we will have duty free access to one of the largest markets of 2.2 billion consumers, we will have the advantage of supply side benefits to the various raw materials for building new industries, in effect, helping us to create our industrial diversification that will ultimately lead towards export diversification. We need to create opportunities for technology transfer through partnerships, join-ventures, etc.  

Most importantly, some of the members of RCEP are top investors of the world, therefore through RCEP, Bangladesh will be in a better position to attract foreign direct investment (FDI) from RCEP members. So far, Bangladesh has not been able to attract the required amount of FDI into the country. Given Bangladesh's economic foundation, close to 3%-4% of GDP should be the yearly FDI coming into Bangladesh.  

The challenges and limitations 

On the contrary, there will be various challenges when entering such a large trading block, and we must have pragmatic policies and strategies to counter the challenges. 

First and foremost, we need to become competitive and remain competitive to face the new economic realities. Today, we remain very competitive inside the factory area, but our competitiveness slowly diminishes as we move out of our factory premises; we must address these concerns and improve our competitiveness. We must also address the various reforms needed to create an improved business environment for our industries to cope and sustain our place in a regional partnership. 

There is a strong need to reform our policies to address the global changes in motion. Our policy coordination and policy simplification, including improving various processes from taxation to land registration, need to gain momentum. Our reforms must be fast tracked and focused towards creating increased economic freedom for our citizens. Government has already embarked on many development plans which will indeed help improve our competitiveness, but we need to expedite the process. 

On the other hand, the demand for an efficient infrastructure including transport eco-system is a mandatory precondition for Bangladesh to accelerate its growth; and gain from the RECP partnership.  Therefore, extensive focus on the development of a sustainable modern transport eco-system to improve connectivity - including port infrastructure and logistics efficiency to increase the overall transport and country competitiveness - will be critical to maximise opportunities arising from RCEP. 

In this connection, we need to work towards a National Logistic Policy to enable Bangladesh to become the transportation hub for the region.  Bangladesh today is the natural gateway between South Asia and Southeast Asia, now it needs to develop the capabilities to truly become the economic gateway, this includes the establishment of a logistics hub for the region.  

Japan, as we all know, further strengthened bilateral cooperation through the Japan-Bangladesh Comprehensive Partnership and after which the "Bay of Bengal Industrial Growth Belt" was launched.  Under this cooperation, Bangladesh would see accelerated industrialisation of the Dhaka-Chattagram - Cox's Bazar belt area and beyond, which would encompass developing the economic infrastructure, improving investment environment and fostering connectivity turning the region into an economic powerhouse and the gateway between South Asia and Southeast Asia. 

And the RCEP partnership will catapult Bangladesh into the next level of economic prosperity and connectivity. Bangladesh is indeed at a critical juncture of its economic development momentum, partnerships like RECP can help accelerate our progress to attain the vision to become a developed country by 2041. 

We must not miss this opportunity rather maximise it to solidify our place in the Asian Century.

 

Abul Kasem Khan. Sketch: TBS

Abul Kasem Khan is the chairperson of the trustee board of Business Initiative Leading Development (BUILD). 

[Joel Ahmed]

https://today.thefinancialexpress.com.bd/trade-market/time-to-boost-trade-between-dhaka-and-jakarta-fbcci-1641227511

Time to boost trade between Dhaka and Jakarta: FBCCI

 January 04, 2022 00:00:00

FBCCI President Md. Jashim Uddin on Monday called upon the government to take initiative to harness the huge untapped potentials of bilateral trade between Bangladesh and Indonesia, reports UNB.

Jashim made the call when Bangladesh Ambassador to Indonesia Air Vice Marshal Mohammad Mostafizur Rahman called on him at his FBCCI office.

In FY 2020-21, the import-export trade between Indonesia and Bangladesh stood at US$ 1.9 billion, which has a huge potential for further growth.

Indonesia has a large market for Bangladeshi medicines, agricultural products, poultry, jute and leather goods and footwear.

Jashim also urged the ambassador to take initiative so that Indonesia would also invest in an economic zone of Bangladesh.

During the meeting the ambassador said that the Bangladesh government is keen to be a sectoral dialogue partner of Indonesia.

As the tariff and tax structure in the country is relatively simple, it will be easier for Bangladeshi exporters to capture the market, he said.

"Indonesian entrepreneurs are interested in investing in Bangladesh through joint ventures in the pharmaceutical and SME sectors," he said.

He also said that a delegation led by the country's industry minister or commerce minister will visit Bangladesh this year to explore bilateral trade and investment prospects.

He said negotiations are also underway on a preferential trade agreement (PTA) with the country.

FBCCI Senior Vice President Mostofa Azad Chowdhury Babu, Vice President Md. Amin Helaly, Director MGR Nasir Majumder and Secretary General Mohammad Mahfuzul Hoque were present during the meeting.

[Joel Ahmed]

https://thefinancialexpress.com.bd/views/columns/time-to-decode-bangladesh-israel-trade-1622130558

Time to decode Bangladesh-Israel trade

 Asjadul Kibria   | Published:  May 27, 2021 21:49:19

From now on, Bangladesh passport is 'valid for all countries of the world.' Even a few months ago, the passport contained the words 'valid for all countries of the world, except Israel.' Dropping of the words 'except Israel' might lead many to believe that the government has decided to make a change in its policy towards the 'pariah' state on the Middle East scene.

As the news, revealed by local and international media outlets, sparked debates, ministers concerned came up with their own explanations on the matter. The home ministry, responsible for issuing passport, argued that it is done to enhance international standard of Bangladesh passport.

The foreign ministry clarified that there has been no shift in the country's foreign policy, especially towards Israel. The country will continue to support the rights and freedom-struggle of the Palestinian people. The foreign minister further mentioned that even after dropping the 'except Israel', travel to the Zionist country is still illegal for any Bangladeshi passport-holder. Bangladesh is yet to recognise Israel or establish diplomatic relations with, officially.

However, despite the absence of any diplomatic ties, the trade relations between Bangladesh and Israel are slowly growing. Bangladesh has exported a small number of goods to Israel in the last few years. The latest official statistics, released by the Export Promotion Bureau (EPB), showed that in the FY20, Bangladesh exported goods worth about US$28,067 to Israel. EPB data also showed that total exports to Israel from Bangladesh stood at around $0.50 million in the last decade. The highest amount of goods worth $0.11 million was exported in FY19 while the lowest annual exports were recorded at $2,057 only in FY14. Textile, ready-made garments (RMG) and pharmaceuticals are major exportable items to Israel.

Now a pertinent question is: how can exports take place when there is no diplomatic relations? It is learnt that Bangladeshi products generally landed in Israel through a third country like Singapore, Malaysia or the UAE. For instance, Bangladeshi manufacturers and exporters shipped the products to Singapore and received due payments from the island state.

So, the total transaction is recorded as Bangladesh-Singapore trade. From Singapore, the products are transhipped to a mother vessel bound for Haifa seaport in Israel. In this process, Bangladeshi products ultimately enter the Israeli market. A representative or liaison office of Israeli importers in Singapore conducts the whole deal.

The actual amount of exports from Bangladesh is thus unclear. The World Bank's World Integrated Trade Solution (WITS) database provides a contrasting figure in this connection. It showed that between 2010 and 2018, Israel imported products worth around $333.74 million from Bangladesh. In other words, Bangladesh exported products worth the said amount ($333.74 million) to Israel during the period under review. The figure doesn't tally with data available with EPB. One reason may be Israel records the imports done through the third country, from the country of origin.

Again, WITS data shows that Israeli exports to Bangladesh stood at $3.67 million between 2009 and 2015. No data is available after 2015 in the WITS system. Bangladesh Bank data also doesn't have any mention of Bangladesh's imports from Israel. Therefore, it is necessary to get some explanation on the bilateral trade with Israel.

It appears that in the age of globalisation, it is not possible to contain trade flow, especially when there is a demand. If the direct trade route is blocked, the traders will go for diversion using a well-recognised third country. Israel is also trading with Gulf Cooperation Council (GCC) countries using third counties. In 2018, Israeli exports to the GCC bloc were around $1.0 billion. Though Qatar and Oman had linked trade relations with Israel since 1996, Doha severed it in 2009. Israeli exports to the GCC market are sometimes channelled through Jordan or Turkey, but primarily via European and other non-Middle-East and North African (MENA) countries. In 2020, the United Arab Emirates and Bahrain signed agreements with Israel for normalisation of relations.

Trade through third countries also gradually opens a window of further normalisation of relations. Indonesia is an example in this connection, which is trading with Israel by third countries. Bilateral trade between these two countries reached around $500 million. Indonesian citizens are now allowed to visit Israel procuring visa from a third country such as Thailand. Israeli official statistics showed that in 2019, some 38,700 Indonesians travelled to Israel and occupied Palestinian territory. In a similar vein, travellers from Malaysia to Israel numbered 14,700 although Malaysian passport mentioned that it is 'valid for all countries of the world, except Israel.'

By dropping 'except Israel' from Bangladesh passport, the travel document may not be restrictive for Bangladeshi citizens to visit Israel. Like Malaysians and Indonesians, they may now collect the required visa from Israeli foreign mission in Bangkok or New Delhi. Israel now issues a `loose-leaf' visa which is not attached as a sticker on the passport page. Again, Israeli border control officials no more stamp in passport page of a traveller. Instead, they issue a permit in a separate paper, which travellers have to retain until they exit the country. Thus, there is no seal or sign in the travellers' passports showing that they have visited the Zionist country. Israel adopts the method to attract more tourists from countries with whom it has no diplomatic affiliation. As tourism is an essential source of Israel's economy, contributing around 6.0 per cent to the country's GDP, it needs more tourists to come in. Moreover, an incrementally higher flow of tourists from Muslim-dominated countries is a boon for Israel to enhance its image against the backdrop of repression of the Palestinians, who get wide Muslim supports.

It is unknown whether a few Bangladeshis were earlier daring to visit Israel by acquiring a visa from a third country. That attitude may, however, change in the near future. There is a fear that this may affect support and sympathy to the legitimate and rightful struggle of the Palestinian people. But, trade may continue to grow as Bangladesh is looking for new markets. 

[email protected]

 

[Sana]

I believe that Bangladesh is improving ties with Israel, albeit very slowly and discreetly. If this benefits our country, so be it.

[Joel Ahmed]

এক মাসের আয়ে রেকর্ডের পাশাপাশি ২০২১ খ্রিস্টীয় বছরে প্রায় ৪০ বিলিয়ন ডলার (মোট ৩ হাজার ৯১৩ কোটি ৯৪ লাখ ডলার বা ৩৯ দশমিক ১৪ বিলিয়ন) পণ্য রপ্তানি হয়েছে।

২০২০ সালে তিন হাজার ৩৬০ কোটি ৫৩ লাখ ডলারের (৩৩ দশমিক ৬ বিলিয়ন) পণ্য রপ্তানি হয়েছিল। এক বছর আগের তুলনায় এবার রপ্তানিতে প্রবৃদ্ধি হয়েছে ১৬ দশমিক ৪৬ শতাংশ।

প্রধান রপ্তানি পণ্য পোশাকের ওপর ভর করেই ডিসেম্বরে একক মাসে রেকর্ড ৪৯০ কোটি ডলারের বেশি। শুধু পোশাক থেকে রপ্তানি আয় হয়েছে ৪০৪ কোটি ডলার।

এ দুই মাইলফলকের পাশাপাশি চলতি ২০২১-২২ অর্থবছরের জুলাই থেকে ডিসেম্বর পর্যন্ত প্রথম ছয় মাসের সার্বিক রপ্তানি প্রবৃদ্ধিও এখন পর্যন্ত সর্বোচ্চ।

 

[Joel Ahmed]

https://thefinancialexpress.com.bd/economy/bangladesh/goods-trade-with-the-world-crosses-110b-in-2021-1641721332

Goods trade with the world crosses $110b in 2021

 FE ONLINE REPORT | Published:  January 09, 2022 15:42:13 | Updated:  January 09, 2022 17:47:51

https://thefinancialexpress.com.bd/uploads/1641721333.jpg

The country’s bilateral trade in goods with the rest of the world crossed US$110 billion in the last calendar year, showed the FE estimation based on statistics of exports receipts and imports payments in 2021.

Statistics released by the Export Promotion Bureau (EPB) showed that the annual exports earnings of Bangladesh stood at $44.23 billion in the last year which was $33.61 billion in 2020.

Thus exports earnings rebounded significantly by increasing 31.64 per cent in 2021.

Payments for imports of goods, on C&F basis, stood at $72 billion in the first 11 months of the past year which was 36.40 per cent more than the annual imports payments in 2020.

Imports payments figure for December last is yet to be available.

By adding 12 months' exports receipts and 11 months' imports payments of the last year, it is found that the value of total trade in goods stood at $116.23 billion in 2021. The actual amount will be higher once the imports figure for December is available.

In 2020, the value of trade in goods was recorded at $86.40 billion. Thus, trade in goods increased by 34.50 per cent in the past year from the previous year.

Bangladesh’s global trade in goods declined by around 12.20 per cent in 2020 from $98.50 billion in 2019 due to the pandemic.

[email protected]

[Joel Ahmed]

https://thefinancialexpress.com.bd/economy/bangladesh/bangladesh-proposes-fta-with-eurasian-union-1641786892

Bangladesh proposes FTA with Eurasian Union

 SYFUL ISLAM | Published:  January 10, 2022 09:54:52

A vast market appears in sight as Bangladesh has formally proposed to the Eurasian Economic Union (EAEU) to strike free-trade agreement (FTA), officials say, as the country prepares for a socioeconomic status change.

The proposal was made last week on the back of a tip from the Eurasian Economic Commission (EEC) so that it could seek concurrence of its member-states-Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan.

These five Eastern European countries have over US$1.5 billion annual bilateral trade with Bangladesh, which the commerce ministry officials think can increase manifold if a free-trade pact is inked.

The officials concerned say Bangladesh and the EEC signed a memorandum of cooperation in Moscow in May 2019 aiming to take forward bilateral trade. Later, a working group was formed to enhance trade and economic cooperation in 19 sectors.

The first meeting of the working group was held in November last in Moscow, with the Bangladesh side led by commerce ministry additional secretary Noor Md Mahbubul Haq while the EEC side headed by its board member Sergey Glaziev.

In the meeting the Bangladesh side had expressed interest in concluding an FTA with the EAEU and the EEC suggested sending a formal proposal in this regard.

A senior commerce ministry official told the FE Sunday Eurasia is a growing market for Bangladesh and also the bilateral trade is increasing substantially day by day.

He said the 19 sectors identified in the memorandum of cooperation would not be focused at a time, and thus Bangladesh initially prioritised trade in goods, services and investment.

Alongside these, he adds, the EEC added energy and a couple of sectors for starting work immediately.

"Our main target is Russian market," he says, adding that since Russia would not be able to sign any deal unilaterally, "we have to go through EAEU to get any facility there."

Bangladesh has already conducted a feasibility study and found that signing FTA with EAEU may yield positive results.

"After getting EEC's consent we will form a negotiation team and start formal talks," he says, preferring not to be named.

In fiscal year 2019-20 Bangladesh exported goods worth $398 million to EAEU- member states while imports from there cost $1.106 billion.

Ahead of formal graduation from the least-developed country (LDC) group in 2026,

Bangladesh has intensified its efforts to enter into FTA and Preferential Trade Agreement (PTA) deals with potential trade partners to make up for eventual GSP loses in the western countries after it graduates into developing-country group.

Bangladesh signed first bilateral PTA with Bhutan in December 2020 and was advancing talks on trade pact with a number of countries which include India, Indonesia, Malaysia, and Sri Lanka.

[email protected]

[Joel Ahmed]

https://www.tbsnews.net/bangladesh/energy/how-summit-takes-new-step-abroad-indian-power-plant-355759#.YdxdIJrYnCo.facebook

Sharier Khan & Eyamin Sajid

10 January, 2022, 10:15 pm

Last modified: 11 January, 2022, 05:02 pm

How Summit takes new step abroad in Indian power plant

 

Top Bangladeshi private power company Summit has acquired around one fourth of a power project of an Indian power company in Tripura, marking the first footprint of any Bangladeshi company on investing in a foreign power venture.

Summit bagged 23.5% of the ONGC Tripura Power Company (OTPC) in July last year committing to invest about US$50 million in its 750mw gas fired power plant in Tripura. Summit is now awaiting approval of the central government.

"I think this would be the first purchase by any Bangladeshi-owned company investing in a power plant abroad," said Chairman of Summit Group Muhammed Aziz Khan, adding that he expected the shares would be transferred to his company Summit India (Tripura) in a month or two.

This is the very power plant that Bangladesh had helped OTPC build a decade back by allowing transshipment of its heavy equipment through Bangladesh. Now this company is set to build another 350-megawatt power plant from gas, transmission assets and renewable potentials.

Summit is also in talks with another company over a deal to invest, purchase and import renewable energy to Bangladesh from India at a competitive rate. These cross border renewable deals are backed by The World Bank and the International Finance Corporation (IFC) and are part of policies of the two governments.

The company that now has a huge stake in Bangladesh's energy industry is also trying to secure a Liquefied Natural gas (LNG) deal with an American company on a long-term basis at a reasonably low cost.

https://www.youtube.com/watch?v=_Izn8ogjClc

 

Aziz Khan, in conversation with The Business Standard, also reflected on how his home-grown infrastructure company of the nineties was becoming a multinational entity.

The company moved its headquarters to Singapore six-seven years back with a view to expand its activities beyond Bangladesh, which still remains its business hotspot and where Summit plans to invest another $3 billion by 2025. Moving to Singapore has made it easier for Summit to get finances, he said.

In 2017, Summit won a bid in India to develop a port in Kolkata. It bagged another deal recently to run another port in Patna -- which is now under construction.

 "For the last four years, we have been operating the Kolkata port that we implemented under the build-own-operate-transfer model by winning a tender from the Inland Waterways Authorities of India,'' said the Summit Group chairman.

"I think that nobody [in Bangladesh] has invested in ports or infrastructure abroad before," said Khan.

Summit has 20 power plants in Bangladesh with a capacity to generate 1,942MW electricity—representing around 8% of the country's total power generation capacity -- and another 600 mw under construction.

The infrastructure conglomerate also has a floating storage and regasification unit (FSRU) for supplying 500mmcf LNG per day.

Summit shifts to Singapore to broaden the horizon

"We have shifted our head office to Singapore to broaden the horizon from containment to go to India and other sub continental countries," Aziz Khan said.

Khan said that implementing a power plant in Bangladesh is a very difficult task because of the high interest of capital and lack of funding.

He said that the Summit Group has so far invested $2.5billion in Bangladesh.

"For implementing a project, you need to have 30% capital and 70% debt. But I did not have that money. So, I had to take a loan," he said. 

"From that calculation, I had to manage around $900million. But you didn't hear that I defrauded any banks or people. So, I had to get this capital. Then, I had to manage a $2.1 billion loan, and there is no allegation that I'm not repaying the loan either," Khan added.

"It was possible due to the low cost of capital. We took a $350 million loan from Standard Chartered Bank at 3.5% fixed interest against the Switzerland state bank's guarantee.

"But implementation of large projects would not be possible by paying 10-12% interest rate to the local financiers. The private sector does not get the opportunity to obtain loans at an interest rate of 1% like the government," he said.

"Being a private sector company, we get a loan at 3.5% and our average interest rate is 4.5% against the current $800million loan. And 80% of this loan book is from foreign companies or lenders," he said.

Khan said others are not getting the commercial loan because of their own company's governance and the credit rating of Bangladesh.

Bangladesh's credit rating is also a reason behind the shift of the head office to Singapore, said the Summit Group chairman. "Cost of the fund depends on the credit rating. If you want big spending, you need to go to a big market and Singapore is a big market," he said.

Bangladesh's credit rating is still BB minus (BB-), while Singapore is a triple-A or double-A rating country.

"So, we get double-A if we do the credit rating in Singapore, but if we do it here in Bangladesh, we won't be able to get it above BB minus," he said. 

Another reason for the shift to Singapore was to hire skilled manpower for large projects, said Aziz Khan. 

"Getting management is very tough here in Bangladesh because nobody has done big business. You cannot find someone who has done a 580MW power plant implementation, but that is available all over the world," he added.

Summit invests with American company for long term LNG solution 

Summit Group, the trailblazer in the power and energy sector in Bangladesh, is now eying a long term LNG solution.

Talking about the new horizon of the business, Aziz Khan, said, "We are now discussing investment in LNG liquefaction and transportation processes with American companies. If we are successful, we will be able to supply LNG at a lower price." 

"Recently, we have signed a Memorandum of Understanding (MOU) with Commonwealth LNG to collaborate in the supply of LNG to Asia, including Bangladesh," he said.

The scope of the MoU includes contracting for 1 million tonnes per annum (MTPA) of LNG offtake, for a term of up to 20 years, from Commonwealth's 8.4 MTPA facility currently under development in Cameron, Louisiana.

Building the third FSRU of the country

Summit Group is also looking to establish its second and the country's third FSRU at Moheshkhali coast to regasify another 500 MMCF LNG.

In this regard, Aziz Khan said, "We have applied for the second FSRU and we have heard that it has been positively taken by the government.

"Rupantarita Prakritik Gas Company Limited (RPGCL), the state-run company responsible for LNG operation, is going to call us for negotiation," he added.  

The Summit Group chairman also said that this was not by their persuasion, but the country needed it and Petrobangla understood that. 

Petrobangla wanted to build an on-shore terminal but they could not acquire the land for it yet, he said.  

"Even if they get the land, it will take time to develop the land and they have to dig at an 18-metre depth for storage, but the country does not have that time," Khan further added.

The capacity of the new FSRU will be 170,000 cubic metres, which would be 30% higher than the existing one. 

Will LNG remain affordable?

Currently, the country has a demand for around 3500mmcf to 4000mmcf of gas per day, whereas it gets only 2500mmcf from local gas fields, so a gap remains there.

The margin of the demand gap will be bigger once the 100 economic zones, undertaken by the government, come into operation. 

 "And as the reserve of natural gas deflates gradually, the demand-supply gap of gas has to be fulfilled by LNG," said Khan.  

The next infrastructure necessary for Bangladesh is how to bring LNG and how to continue to supply the most needed energy for the continuous and sustainable development of Bangladesh, he added.

But in the last one year LNG price was wildly volatile and went up to $36 per MMBtu. 

Talking about affordability, Khan said, "To get the lower price, we have to go to a long term contract, instead of spot purchase." 

Khan also said that his new FSRU would be able to provide LNG at cheaper rates than the existing ones. And it is possible if one invests in liquefaction and transportation of LNG, he said.

[Joel Ahmed]

https://www.tbsnews.net/dropped/trade/bangladesh-sets-80-billion-export-target-2024-356389

TBS Report

12 January, 2022, 01:35 pm

Last modified: 12 January, 2022, 01:43 pm

Bangladesh sets $80 billion export target for 2024

The export target for 2021 was $60 billion

 

The Cabinet Committee on Economic Affairs approved draft of "Export Policy 2021-2024" today setting an $80 billion export target for 2024.

The export target for 2021 was $60 billion.

"All exporters will get uniformed facilities. Besides we will provide policy supports regarding challenges over 4IR," Finance Minister AHM Mustafa Kamal said in the virtual meeting of the committee.

He also said, "The government will emphasize on recycling, and research and development."

Regarding Planning Minister MA Mannan's concern that Bangladesh might fall in the middle-income trap, the finance minister said, "Bangladesh will never fall in middle income trap as own resources and funds are being used in the country's developments. Foreign investments in Bangladesh are very low."

"Whereas Vietnam's economy depends on foreign investments. They can't be compared with Bangladesh," he added.

[Joel Ahmed]

https://thefinancialexpress.com.bd/national/finance-minister-rules-out-middle-income-trap-for-bangladesh-1642041414

Finance minister rules out middle income trap for Bangladesh

 FE REPORT | Published:  January 13, 2022 08:36:54 | Updated:  January 13, 2022 12:29:44

https://thefinancialexpress.com.bd/uploads/1642041414.jpg

No chances are there for Bangladesh getting caught in a middle-income trap in its LDC graduation process for its inherent economic dynamics, Finance Minister AHM Mustafa Kamal said Wednesday.

He made the remark after presiding over two cabinet-body meetings one of which approved a package of government purchase proposals and another endorsed a new export policy that looks up to US$80 billion worth of annual export by 2024 fiscal.

"I think at this moment it's not applicable to us to fall in middle-income trap," the finance minister told newsmen after the virtual meeting of the cabinet committee on government purchases, thus dispelling another minister's premonition.

He mentions that Bangladesh's perspective plan 2041 clearly spells of year-wise projections and paths for implementation of development works in the run-up to being a higher-income country.

Mr Kamal's comment came a day after Planning Minister MA Mannan, echoing in part some economists' precaution, expressed apprehension that Bangladesh might fall into a 'trap-like' situation if challenges couldn't be addressed well in time.

According to World Bank definition, middle-income trap refers to a situation whereby a middle-income country fails to transition to a high-income economy due to rising costs and declining competitiveness.

Many counties in Latin America and the Middle East have been mired in a middle-income trap, and recent evidence also suggests that a number of countries in East Asia are also in a similar predicament.

Mr Kamal categorically said one cannot compare Bangladesh with other countries which got into the trap for various reasons.

Citing an example he says investment in Vietnam almost all came from foreign sources. Thus, when the international market faces ups and downs, foreign investments there also face the impacts.

"But in our country, it's totally opposite to that," he told the press, adding: "Whatever we did so far is largely from our own investment. Thus I don't think our investment will face any turmoil."

Replying to a query on cutback in hiked fuel-oil prices, Mr Kamal said the ministry concerned would look after the matter.

"You know how far the price climbed once. Now the fuel-oil price is going down. I believe the government will consider it," says the minister who holds the purse strings.

Regarding price hike of the US dollar at banking level, he said since export and import are rising simultaneously, dollar price is also seeing a rise.

But there is no possibility of excessive price hike of the dollar, the finance minister says.

In the last couple of days, the dollar has sold at Tk 86 in banks while in the kerb-market rate is over Tk 91.

Earlier, the cabinet committee on economic affairs approved in principle the draft 'Export Policy 2021-24', placed by the ministry of commerce.

In the new policy the government sets sights high on an export turnover of $80 billion for the fiscal year 2024.

"All export sectors will get uniform facilities under the export policy," the finance minister said while reading out some salient features of the newly stamped document.

The purchase committee in the meeting approved a proposal for import of 1.49 million tonnes of refined fuel oils during the January-June 2022 period from six state-owned enterprises of Thailand, the UAE, China, Indonesia and Malaysia.

Bangladesh Petroleum Corporation (BPC) will make the import under government-to-government deals.

Also, the meeting endorsed another proposal from the BPC to import 90,000 tonnes of diesel from India's state-run Numaligarh Refinery Ltd at a cost of Tk 5.124 billion.

The Bangladesh Hi-Tech Park Authority has been given the green light at the meeting to construct eight steel-structure multipurpose buildings in eight districts at a cost of Tk 12.051 billion by appointing LARSEN and TOUBRO Ltd, India, as contractor.

Bangladesh Power Development Board (BPDB) also got the go-ahead to buy 32,400 SPC Poles from a joint venture of Charka SPC Poles Ltd, Dada Engineering Ltd, and Confidence Infrastructure Ltd at a cost of Tk 313.6 million.

Also, BPDB will buy another 32,396 SPC Poles from a joint-venture company of Charka SPC Poles Ltd, Confidence Infrastructure Ltd. and Poles and Concrete Ltd at a cost of Tk 313.5 million.

Under another approved purchase proposal the Rural Electrification Board (BREB) will buy 13,040 distribution transformers at a cost of Tk 719.9 million from TS Transformers Ltd.

The purchase body also approved a pack of five proposals of Bangladesh Inland Water Transport Authority (BIWTA) for excavation works of Punarbhaba River by engaging seven different contractors.

Proposals for procurement of two tugboats each by the Chittagong Port Authority (CPA) and the Mongla Port Authority from Cheoy Lee Shipyards Ltd, Hong Kong, also secured the cabinet body's nod.

[email protected]

[Joel Ahmed]

https://www.tbsnews.net/dropped/trade/china-offers-zero-tariff-access-98-bangladeshi-products-357205

Abul Kashem

13 January, 2022, 10:55 pm

Last modified: 13 January, 2022, 11:07 pm

China offers zero-tariff access for 98% Bangladeshi products

The number of products enjoying the duty holiday will stand at 8,930

 

China, the largest economy in Asia, has decided to grant duty-free access to 98% of Bangladeshi products through the inclusion of 383 new products, especially leather and leather goods, in the zero-treatment list.

In this way, the number of products enjoying the duty holiday will stand at 8,930.

Commerce Secretary Tapan Kanti Ghosh confirmed it to The Business Standard.

To bring this extra facility into effect, Bangladesh and China will sign a letter of exchange. 

Chinese Ambassador to Bangladesh Li Jiming has already signed the document on behalf of his government. On the other hand, Bangladesh's commerce ministry has started the signing process, according to sources familiar with the matter. 

The Chinese embassy in a note verbale forwarded to the commerce ministry on Wednesday said the Chinese government will grant the duty-free treatment for imported goods originating from Bangladesh with a view to promoting the economic development of China and Bangladesh, as well as to strengthen the economic and trade relations between the two countries.

"It would be appreciated if the Bangladesh government could complete the signing of the letter of exchange as soon as possible, so as to facilitate the enterprises and people of Bangladesh to benefit from the special tariff treatment soon," the letter said.

In 2020, China offered 97% of Bangladeshi products duty-free access to its market and 8,547 Bangladeshi products came under such treatment. But some leather goods, a major exportable to China, were left out of the facility.

This time these left-out items have made it to the list, according to sources at the commerce ministry.

"We have got a new list of products granted duty-free access to the Chinese market today [Wednesday] from the Chinese embassy," Noor Md Mahbubul Haq, additional secretary to the commerce ministry (FTA), told TBS.

They are analysing harmonised system codes of products in the list written in Chinese. So, they cannot say names of the products right now, he added.

The leather and leather goods are included in chapter 48 of the HS code list. Earlier, six of such products were given the duty-free facility. The number of products will go up in the new list, Noor noted.

Seeking anonymity, a commerce ministry official said Bangladesh exports its local leather and leather goods mainly to China. And, the items it exports to European countries are produced after importing leathers from abroad.

So, the duty-free treatment for Bangladeshi leather and leather goods in China will help boost exports, the official added.

Mohiuddin Ahmed Mahin, president of Bangladesh Finished Leather, Leather Goods and Footwear Exporters Association, told TBS that China's decision to include leather and leather goods in the list of duty-free products was a positive move.

"The increased duty-free access to the Chinese market will be a blessing for us at a time when China's imports are declining because of the pandemic," he added.

Dr Mostafa Abid Khan, former member of Bangladesh Tariff and Trade Commission, said 99% of export products, including all RMG items, have been covered under the 97% duty-free facility provided by China. But some items of leather and leather goods were left out.

Bangladesh will now get 100% benefit if these are included in the list, he added.

As a single country, Bangladesh imports the most from China, while its exports to the Chinese market are very low. The country's duty-free export facility increased from the first day of the last fiscal year, but exports to the destination have not gone up much. 

According to the Bangladesh Bank, Bangladesh's imports from China in FY21 amounted to about $13 billion, which is one-fourth of the country's import expenditure. At the same time, it exported $681 million worth of goods, up by 13.42% over the preceding year.

In July-December of the current fiscal year, Bangladesh's exports to China amounted to $357 million. The export items included woven garments, knitwear, home textiles, leather and leather products, footwear, jute and jute products and plastic products.

However, businesses believe that there are opportunities to increase exports of readymade garments, leather and leather goods, jute and jute products, frozen fish and other products to China.

Shafiul Islam Mohiuddin, former president at the Bangladesh Garment Manufacturers and Exporters Association, told TBS that the cost of manufacturing garment products in Bangladesh is lower than in China. With China tending to produce high-value products, Bangladesh's apparel exports to the former are likely to increase in the coming days.

ATM Azizul Akil, senior vice-president of the Bangladesh-China Chamber of Commerce and Industry, said, "China is now not only the world's largest exporter, but also at the top in terms of imports. Therefore, if we can increase our capacity, Bangladesh will be able to fetch billions of dollars cashing in on the duty-free facility provided by China."

To capitalise on the zero-tariff treatment, the country needs to diversify export products alongside ensuring standards, ATM Azizul Akil pointed out.

There is also a huge potential for exports of freshwater fish and poultry items to China. For that, Bangladesh must strictly maintain product quality, he added.

[Joel Ahmed]

https://thefinancialexpress.com.bd/economy/bangladesh/bangladesh-singapore-eye-early-conclusion-of-fta-1642073269

Bangladesh, Singapore eye early conclusion of FTA

Published:  January 13, 2022 17:27:49 | Updated:  January 14, 2022 08:37:42

Applauding the initiative for a free trade agreement (FTA) between Bangladesh and Singapore, Foreign Minister Dr AK Abdul Momen on Thursday said FTA would be mutually beneficial by further enhancing the bilateral trade and investment.

"Singapore is an important bilateral trade and investment partner of Bangladesh," he said during a telephone conversation with his Singapore counterpart Dr Vivian Balakrishnan.

The two Foreign Ministers agreed to accelerate the process for concluding the FTA early, reports UNB.

Dr Momen encouraged more Singaporean investors to invest in power, telecommunication, renewable energy, and power transmission sectors in Bangladesh taking advantage of a very friendly investment regime in the country.

While thanking the Government of Singapore for providing humanitarian assistance to the forcibly displaced Myanmar nationals sheltered in Bangladesh, Dr. Momen sought Singapore’s and ASEAN’s proactive role in bringing a sustainable and permanent solution to the Rohingya crisis by ensuring their urgent return to their homeland in Myanmar.

Dr Vivian assured that Singapore would remain engaged on the issue and of Singapore’s continued support for a durable solution to the crisis.

During the conversation, Dr Momen expressed satisfaction over the excellent bilateral relations existing between the two friendly countries, mentioning that Bangladesh considers Singapore as a role model of Economic Development.

The two Foreign Ministers agreed on the necessity of exploring synergies in new areas of cooperation for expanded bilateral engagement.

Dr Momen noted with satisfaction the Singapore government’s continuous support to the Bangladeshi expatriate workers during the ongoing Covid-19 pandemic.

He suggested that Singapore may consider employing more skilled workers from Bangladesh especially in their health and other service sectors.

Praising Dr Balakrishnan’s previous role as Minister-in-charge of the Smart Nation Initiative, Dr Momen shared the rapid digital transformation of the economy and society in Bangladesh under the vision of Hon’ble Prime Minister Sheikh Hasina for a ‘Digital Bangladesh’.

Dr Momen sought Singaporean cooperation in the area of ICT and digitization, to which Dr. Balakrishnan responded very positively and assured of full support and assistance.

Referring to the 50 years of diplomatic ties between the two countries in 2022, both the Ministers agreed to celebrate the special occasion in a befitting manner in both countries.

Dr Momen invited his Singaporean counterpart to visit Bangladesh. Dr Balakrishnan also extended an invitation to Dr Momen for an official visit to Singapore to kick-start the celebration of the 50 years of diplomatic relations between the two countries.

The two Foreign Ministers also exchanged greetings of the New Year and discussed the pandemic situation in their respective countries.

 

[Joel Ahmed]

https://www.tbsnews.net/bangladesh/bangladesh-russias-major-trading-partner-south-asia-spokeswoman-361798#.Ye6eZgJdiro.facebook

UNB

24 January, 2022, 06:30 pm

Last modified: 24 January, 2022, 06:34 pm

Bangladesh Russia’s major trading partner in South Asia: Spokeswoman

Moscow greets Dhaka marking 50th anniversary of diplomatic relations

Bangladesh is Russia's major trading partner in South Asia with the bilateral trade exceeding $2.5 billion a year, says Spokeswoman of the Foreign Ministry of the Russian Federation.

"Congratulations to our Bangladeshi friends on this milestone anniversary of our relations," said  Spokeswoman Maria Zakharova on the 50th anniversary of diplomatic relations with Bangladesh.

25 January will mark the 50th anniversary of diplomatic relations between the Russian Federation and Bangladesh.

Major economic projects are underway, including the construction of Rooppur, Bangladesh's first nuclear power plant, Maria said. 

The mechanism of the Intergovernmental Russian-Bangladesh Commission on Trade, Economic, Scientific and Technical Cooperation, established in 2017, functions well, she said. 

Its latest meeting was held on 15 December, 2021.

"Our countries have long been bound by friendly ties, the foundation of which was laid back in 1972, when the USSR supported the national liberation struggle of the people of Bangladesh and was among the first countries to recognise the independence of the new state," Maria said. 

Bangladeshis remember the feat of Soviet military sailors, who cleared the waters of the port of Chittagong from mines and sunken ships in 1972-1974, she said. 

"Today, our countries maintain an active political dialogue, which is built on the principles of equality and mutual respect," said the Spokeswoman. 

[Joel Ahmed]

https://thefinancialexpress.com.bd/economy/bangladesh/textiles-apparel-exports-to-us-increase-by-3068pc-in-2021-1642942330

Textiles, apparel exports to US increase by 30.68pc in 2021

Published:  January 23, 2022 18:52:10 | Updated:  January 23, 2022 21:25:29

The import volume of textiles and apparel from Bangladesh by the United States of America (USA) keeps growing with 30.68 per cent rise last year, according to the Office of Textiles and Apparel (OTEXA), USA.

The OTEXA recently published the monthly trade data of the United State of America for the period of January-November, 2021.

The US import from Bangladesh during the mentioned period has increased by 30.68 per cent compared to the same period of 2020, whereas their global import saw 25.43 per cent growth, said Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Director Mohiuddin Rubel on Sunday.

China being the top import market for USA and having a 24 per cent share of the USA’s total apparel import, posted 27.29 per cent growth during this period, he said.

During this period USA's import from Vietnam has grown by 12.73, per cent, reports UNB.

Countries which have seen significant growth are - Pakistan 59.30 per cent, Honduras 47.10 per cent, India 35.47 per cent, and Mexico 29.67 per cent.

[Joel Ahmed]

https://thefinancialexpress.com.bd/trade/commerce-ministry-to-coordinate-transit-multimodal-connectivity-matters-1643079064

Commerce ministry to coordinate transit, multimodal connectivity matters

Experts suggest well-thought-out deals as turfs extend far off

 SYFUL ISLAM | Published:  January 25, 2022 08:51:05 | Updated:  January 25, 2022 17:15:46

https://thefinancialexpress.com.bd/uploads/1643079064.jpg

It's now commerce ministry's job to coordinate connectivity and transit affairs in line with the allocation of business, a government meeting decides as many trans-border communications deals are being dealt with.

Officials say the decision comes as different ministries and divisions indulge in completion of transit-or connectivity-related various bilateral and multilateral deals and memorandum of understanding in scattered ways.

The Ministry of Commerce (MoC) thinks that these activities need proper coordination to make the most of these pacts involving trade and commerce and transportation.

Senior Secretary of the commerce ministry Tapan Kanti Ghosh chaired the inter-ministerial meeting which discussed that the Bangladesh-Bhutan-India-Nepal (BBIN), Bangladesh-China-India-Myanmar (BCIM), South Asian Sub-regional Economic Cooperation (SASEC) Regional Integration, Asian Highways, Silk Road, and One-Belt, One-Road arrangements are some of the initiatives where other ministries and divisions have signed various documents.

But the 'Allocation of Business among different ministries and divisions (schedule 1 of the Rules of Business 1996, revised in April 2017)' titled 'Transit Trade through Bangladesh' has allocated the authority of completion of commercial transit-related activities to the ministry of commerce.

The meeting was told that the ministry of shipping had signed 15 instruments with India, Sri Lanka, Bhutan, and Thailand for setting up regional connectivity.

Also, the ministry has taken initiative to sign deal on the setting up of bilateral waterway connectivity with far-off countries like Qatar and Cyprus.

A representative of the ministry of railway in the meeting said presently Bangladesh has rail communications with India on five routes and works are underway to set up two more cross-border routes.

"Besides, under the trilateral protocol signed in 1976 transit traffic system with Nepal also exists," he apprised the inter-ministerial meeting.

A representative of the National Board of Revenue (NBR) pointed out that many ministries had taken different activities and projects on connectivity and transit issues on their own, though the matters are of high national stakes.

He felt that as lead ministry, the ministry of commerce in consultation with the ministry of foreign affairs could take decision on these issues to make those more beneficial in the case of trade and commerce.

The NBR man also underscored the need for prior reckonings before striking deals to determine whether those will have negative impact on country's trade and economy.

A senior commerce ministry official told the FE the issue of trade-related transit must not be isolated rather should be coordinated in national interest.

"Due to the selection of different routes for different countries in the case of regional communications Bangladesh is not getting expected results," he says, indicating the fault- line in trans-border transportation.

He thinks that the transit and connectivity issues should be coordinated under the National Trade Facilitation Committee which is led by the commerce minister.

[email protected]

[Joel Ahmed]

https://www.tbsnews.net/economy/four-firms-get-nod-invest-abroad-365731

Abbas Uddin Noyon & Sakhawat Prince

02 February, 2022, 10:55 pm

Last modified: 03 February, 2022, 10:46 am

Four firms get nod to invest abroad

The Bangladesh Bank has given permission to four private business entities to invest $10 million in foreign countries, in a major leap forward for reining in capital flight alongside easing global marketing of local products. 

One of the permitted companies, Square Pharmaceuticals Limited, a subsidiary of Square Group, will invest $1 million in The Philippines, opening up an opportunity for the company to gain a foothold in the import-dependent $6 billion pharmaceutical market – the third largest in the Asean region. 

Without getting registered with the Food and Drug Administration of the Philippines, no companies with their own brands can directly market medicines in the destination. So, Square needs to resort to a third party for that. 

Mohammad Habibuzzaman, company secretary at Square Group, said the investment plan in the Philippines is in its infancy. They will establish a new company under the name of Square Pharmaceuticals Limited Philippines. The whole thing is now at an early stage.

Earlier, Square Pharmaceuticals Ltd, the domestic pharma giant, constructed its manufacturing plant in the Kenyan capital Nairobi at a cost of $17 million in 2017. All necessary infrastructure is also ready and the manufacturing will start soon.

Square looks to get hold of the $30 million drug market in Kenya and five other East African countries – Tanzania, Rwanda, Burundi, Uganda and South Sudan – and fulfil the unmet demands of medicines in those countries.

Renata Pharmaceuticals, is going to invest $2 million in Ireland as part of increasing the paid-up capital in its already established subsidiary. The approval for this equity investment will allow the drug-maker to sell its medicines directly instead of hiring a third party. 

Besides, Renata will also make an investment amounting to $5 million in the United Kingdom for the same target.

Seeking anonymity, a company official said, "We have already set up subsidiaries in the two countries to directly sell our manufactured drugs in the markets. But not having enough equities for business expansion, we have to have our sales done by a third party by paying 10%-30% commission."

Apart from the two drug makers, ACI Pharmaceuticals, with the central bank's permission on a case-to-case basis, invested $100 million in 2015 to grab a huge drug market in the United States. 

Earlier, in 2014, Incepta Pharmaceuticals was allowed to invest outside the country. The company was supposed to form a joint-venture company in Estonia initially. But the approval is the only thing they got out of the effort because of tough conditions imposed by the government.

Another company that secured the seal of approval is Bangladesh Steel Re-Rolling Mills Ltd (BSRM) will invest $0.5 million to enhance its paid-up capital in its existing subsidiary in Hong Kong.

Shekhar Ranjan Kar, chief financial officer at BSRM Group, said, "We have set up the subsidiary mainly to procure raw materials from China. But we could not do that because of low capital."

The barrier has now been removed as a result of equity investment approval. There is also an opportunity to export goods to those regions through this subsidy, he added.

In 2016, the Bangladesh Bank gave approval to BSRM for investing in the steel sector in Kenya. Subject to fulfilling some conditions, the company was permitted to invest $4.6 million from its balance in the export retention quota to build a factory in the country.

Besides, Colombia Garments Limited, a subsidiary of M&J Group - a leading global manufacturer specialised in jeans production, was given permission to invest $1,5 million in Hong Kong for procurement and business promotion.  

The companies that failed to secure approval are Sonargaon Seeds Crushing Mills Ltd, a subsidiary of Meghna Group of Industries and Bangladesh Venture Capital Limited.

The Sonargaon Seeds Crushing Mills wanted to invest $25,000 to set up a subsidiary in Singapore to expand its business, reduce risks in the supply chain, procure raw materials at affordable prices and deliver goods to customers at even lower prices.

In its application to the central bank for investment abroad, the company said the seed crushing company does not have its own Export Retention Quota Account. So, they want to take this investment in the name of Tasnim Chemical Company belonging to the same group. 

The mill started commercial operation in 2020, which has only one year of export experience.

On the other hand, Venture Capital Limited sought permission to invest $10,000 to acquire 0.85% stake in BrioAgro, a Spanish agro-tech based startup.  

On 27 January, the central bank in a gazette notification permitted Bangladeshi businesses to make overseas equity investments, subject to an adequate balance in their export retention quota (ERQ) – a portion of export earnings they have saved as foreign currency.

The number of Bangladeshi companies that have investments abroad now stands at 18, with a fresh permission to a new company - Colombia Garments Limited.

Performance of businesses abroad 

Sparrow Group, a Bangladeshi apparel exporter, invested in Jordan in 2007 by forming a joint venture company with one of the leading Indian garment manufacturers. 

Some 1600 Bangladeshi and 500 local people are now working in the factory with an annual turnover of $70 million. 

Akij Group, one of the leading private sector conglomerates in the country, took over a Malaysian company named Robin Resources for $20 million. The company fetched a good return from the investment. 

Sk Bashiruddin, managing director of Akij Group, said they did not face new challenges in running the business as they acquired an old company. The return on the equity investment is satisfactory. At present, more than 500 people are working in it.

In a bad example, the DBL Group set up a garment factory in Ethiopia's Tigray region to cash in on the country's duty-free access to the US market, low prices of land and cheap labour in 2018. 

But conflict in the region in 2020 forced them to bring back its workers from Ethiopia after closing the factory. A reopening is still uncertain as the country's civil war rages on.

In 2013, MJL Bangladesh Limited, as the first Bangladeshi company, formed a joint venture with a Myanmar-based petroleum company and invested $5.1 lakh in the neighbouring country. The company made good profit Initially.

But a few years later, MJL started facing losses owing to the increasing political unrest in Myanmar, frequent policy changes and lack of accountability. Eventually, the company came back home by closing down its business in 2020 after suffering a massive loss.

[Joel Ahmed]

https://www.tbsnews.net/bangladesh/bangladesh-interested-sign-fta-big-economies-south-america-369388#.YgYqH0tpHSk.facebook

UNB

11 February, 2022, 03:10 pm

Last modified: 11 February, 2022, 03:18 pm

Bangladesh interested to sign FTA with big economies of South America

Bangladesh, Brazil to strengthen bilateral economic cooperation

Bangladesh has shown interest in signing a free trade agreement (FTA) with Mercosur, an economic and political bloc of the big economies of South America consisting of Argentina, Brazil, Paraguay and Uruguay.

Highlighting Bangladesh's strength as the second largest RMG producer and world-class pharmaceutical manufacturer, Bangladesh Ambassador to Brazil Sadia Faizunnesa has sought Brazil President Jair Messias Bolsonaro's support to negotiate the FTA with Mercosur.

The Brazilian President instructed Brazilian Foreign Minister Carlos Franca to start working towards strengthening bilateral cooperation, including trade and agriculture, according to the Bangladesh Embassy in Brazil.

The Brazilian President promised his support in further enhancing the trade relationship with Bangladesh.  

Earlier, Bangladesh Ambassador to Brazil Sadia Faizunnesa presented her letters of credence to the President of Brazil on Thursday.

Mentioning Brazil as one of the largest democracies in the world, President Bolsonaro said his government is eager to strengthen its relationship with all friendly countries, including Bangladesh.

Ambassador Sadia Faizunnesa conveyed the warm greetings of the President and Prime Minister of Bangladesh to the Brazilian President.

On behalf of the Prime Minister, she invited the Brazilian President for an official visit at his convenience to commemorate the Golden Jubilee of Bangladesh.

The Ambassador also briefed the Brazilian President about the celebration of the birth centenary of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman.

Ambassador Sadia Faizunnesa described the recent socio-economic development of Bangladesh that took place under the prudent leadership of Prime Minister Sheikh Hasina.

The envoy also discussed important aspects of Bangladesh-Brazil relations with the Brazilian President and assured the Brazilian President that she will work to explore the untapped potential.

She requested President Bolsonaro for his support to further expand the trade, economic and agriculture cooperation between our two countries.

The Brazilian President was delighted to learn about the popularity of the Brazilian football team in Bangladesh.

The Ambassador said Bangladesh looks forward to deeply engaging in a multitude of ways with Brazil and to gain a thrust momentum in the partnership there is no alternative to an exchange of VVIP visit.

President Bolsonaro was enthusiastic about visiting Bangladesh, and he promised that his government would continue working with Bangladesh to further strengthen the friendly relations between the two countries.

During her departure from the Planalto Palace Ambassador Sadia Faizunnesa received a guard of honour.

Immediately following the ceremony, the Ambassador returned to the chancery and paid homage to Bangabandhu Sheikh Mujibur Rahman by placing a floral wreath at the portrait of the Father of the Nation.

[Joel Ahmed]

https://www.tbsnews.net/economy/exports-russian-zone-see-29-growth-amid-russia-ukraine-war-402986

Jasim Uddin

14 April, 2022, 12:30 pm

Last modified: 14 April, 2022, 02:02 pm

Exports to Russian zone see 29% growth amid Russia-Ukraine war

When the war started on 24 February, it was assumed that Bangladesh's shipments of export goods would dry up

 

Despite the ongoing Russia-Ukraine war and exclusion of some Russian banks from using the Swift global payments system, Bangladesh's merchandise shipments to the Russian zone have retained growth, thanks to the use of alternative routes and payment channels, exporters say. 

When the war started on 24 February, it was assumed that Bangladesh's shipments of export goods would dry up because of disruptions in supply chains and payment systems.

However, data from the Export Promotion Bureau (EPB) show that the country's export earnings saw about 29% growth to 223.01 million in the markets of Russia, Ukraine, Belarus and Poland year-on-year in March of FY22. 

The earnings amounted to $173.12 million in the same month of the last fiscal year. 

Faruque Hassan, president at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said, "We are all trying to maintain this market growth through the collective efforts made by stakeholders." 

The buyers are trying to receive goods for the Russian market through alternative destinations, and they are also using alternative payment methods, he added.  

Some buyers have withheld orders made for the Russian market, while some others have shifted Russian orders to other destinations. The fashion brand LPP is one such brand that has already shipped some goods to Poland instead of Russia, he added. 

Pradip Nath, assistant general manager (Compliance & HR) at Interstoff Apparels Ltd, an apparel exporter to the Russian market, said, "We export some products for the Russian market and our shipments are going on despite this war." 

The firm is conducting business through the Swedish buyer H&M. 

However, Team Group Managing Director Abdulla Hil Rakib said, "My Russian buyers have already cancelled $3 million worth of orders, which were supposed to be shipped in June-July this year." 

Besides, some $1.7 million worth of shipments have been deferred to July from April due to the vessel crisis, he also said. 

If the war is prolonged, it will adversely affect the European economy as it is mostly dependent on Russia, he added. 

Export growth in Poland is normal as it is a growing market, thanks to a number of Polish buyers, who are witnessing their gradual growth in businesses across Europe. 

Explaining further, he said the Polish buyer LPP is one of the growing brands. It owns six brands, such as the fashion brand Inditex.

Another polish buyer, PEPCO, was established in 2004. Today the brand has over 2,200 stores across Europe, noted Abdulla Hil Rakib, who is also a director of BGMEA. 

TAD Group managing director Ashikur Rahman Tuhin said the impact of the war will be more visible after 3-4 months as it takes 4-5 months to complete shipments of goods under an order. 

Russia is the second largest market for the Spanish buyer Inditex, which has already temporarily closed its outlets. 

Considering the safety of its customers and employees, H&M, the Swedish fashion giant, has temporarily suspended all sales in Russia. 

Not only H&M and Inditex, but a number of brands temporarily closed their stores in Russia, which was reflected in the exports, said Tuhin.

He also said Russian buyers are making payments through Turkey and China, while some others are making payments through Singapore, he added.

According to Export Promotion Bureau (EPB) data, Bangladesh's export earnings amounted to $4.76 billion last month, exceeding the $3.54 billion target set for the month. The country's export receipts were $3.07 billion in March last year.

[Joel Ahmed]

https://www.tbsnews.net/economy/corporates/walton-procure-3-italian-compressor-brands-398438

TBS Report

06 April, 2022, 04:10 pm

Last modified: 07 April, 2022, 01:52 pm

Walton to procure 3 Italian compressor brands

Walton will form a subsidiary company to run the business in Europe and USA

 

Bangladesh electronic giant Walton Hi-Tech Industries is going to procure three compressor brands of Italian state-owned company Italia Wanbao-ACC.

The brands are ACC, Zanussi Elettromeccanica (ZEM) and Verdichter (VOE).

Walton disclosed it on the Dhaka Stock Exchange (DSE) website on Wednesday. But it did not disclose the procurement value in the statement.

An official of Walton said Italia Wanbao-ACC has sold its compressor unit to Walton in an open tender. The deal will be completed within next three months.

As per the deal, Italia Wanbao-ACC will stop its production in Italy and will send the factory setup – that has a capacity of producing 3.2 million units of compressors a year – to Bangladesh. This will give Walton a production capacity of 4.8 million units yearly.

Walton will form a subsidiary company to run the business in Europe and USA.

Walton will sell the compressor under the name of Italia Wanbao-ACC both in Bangladesh and abroad. Walton started its business initially purchasing compressors from the Italian company.  

Italia Wanbao-ACC has been operating for the last 50 years and has business in 57 countries.

Walton will have to invest more than Tk1,000 crore initially for the project and the majority of financing will come from Germany-based lender DEG and Austrian lender OeEB.

[Joel Ahmed]

https://thefinancialexpress.com.bd/trade/bangladesh-agog-to-sign-fta-with-asean-1650427930

Boosting trade after graduation

Bangladesh agog to sign FTA with ASEAN

Talks soon, tariff gap may become concern

 SYFUL ISLAM | Published:  April 20, 2022 10:12:10 | Updated:  April 21, 2022 18:12:02

Bangladesh now works vigorously to sign free-trade agreement (FTA) with ASEAN before LDC graduation to make up for loss of preferential trading facility following exit from the poor-country club.

Dhaka's attention is drawn to the Southeast Asian bloc of newly industrialised countries-close to home-by vast trade potential of its member-countries, officials say.

The Bangladesh ambassador to Indonesia will soon have a meeting with the ASEAN secretariat to brief about the importance and the perspective of signing FTA between Bangladesh and the coalition, sources say.

The ministry of commerce also plans to send a special representative to Indonesia to assist the envoy in the discussion at the ASEAN (Association of Southeast Asian Nations) headquarters in Jakarta.

At the consultation officials will inform that Bangladesh holds out good prospects for ASEAN investment by virtue of a huge South Asian market. Bangladesh exports will get duty-free quota-free (DFQF) market access till 2029, even after graduation, in various developed nations.

The ASEAN members can take it as an opportunity, and by investing in Bangladesh, they also can export goods to other nations with DFQF facility.

Also, the meeting will be told that Bangladesh-ASEAN trade volume may multiply if a joint feasibility study is conducted to evaluate the static and dynamic effects of FTA.

According to 2020 data, Bangladesh imports goods worth nearly US$7.0 billion from 10 ASEAN states - Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam.

On the other hand, Bangladesh's exports to the Association of Southeast Asian Nations are still very paltry, less than $1.0 billion per annum.

The ASEAN officials will be told that Bangladesh is a prospective market with a 40-million-strong middle class having purchasing power.

Also Bangladesh is currently establishing 100 economic zones where Japan, India, South Korea and China have already established their own economic zones.

Moreover, it has further liberalised its investment policy which holds out good prospect in the field of investment.

"The ASEAN as a bloc or its members may take the liberalised investment facility, the meeting will be told. Also, Bangladesh can be a gateway to South Asian economy, especially to India, a country of 1,400 million people," says one official about the points of negotiations.

Through bilateral cooperation the two sides can harness the maximum potential in the field of trade and economic cooperation, the ASEAN headquarters will be apprised.

However, trade officials think that Bangladesh signing FTA with ASEAN will be an uphill task due to high tariff gap between Dhaka and the members of the regional bloc.

They say Bangladesh's average tariff is 14.8 per cent, which has to be lowered to an average of 1.0 per cent to 2.0 per cent if it wishes to enter into free-trade pact with the ASEAN.

A senior commerce ministry official told the FE that high tariff is seen as a big barrier for Bangladesh to clinch any preferential deal.

"Lowering import tariff to some extent would not be a major task for Bangladesh in the coming years as the government is now attaching more importance to direct tax collection," he said.

The government has now taken steps for revenue reform to lower it gradually, he added.

Economists stress widening country's export basket with diverse products from other potential sectors apart from the readymade garment industry to sustain in post-graduation competitive trade and reap due benefit from free-trade pacts.