Discussion Brief for the Export Strategy-Maker
Is your Trade Support Network Working?
Contributed by Suhel Ahmed Choudhury, Secretary, Ministry of
Commerce, Bangladesh
Introduction:
Collaboration among public and private sector
agencies forms a crucial element in the dispensation of national and
international trade related activities in Bangladesh. This culture of
collaboration in the shape of formal and informal networking has been
in practice in the country for quite some time. However, developments
in international trade in recent past, particularly the emergence of
multilateral trading system under the aegis of the WTO have called for
closer communication and stronger networking needs in a variety of
trade related areas. In recognition of the importance of an integrated
approach at policy formulation level as well as implementation,
Bangladesh has been endeavoring to strengthen the interactive
capabilities of the key players in various trade disciplines.
Structure of Network:
Trade support network in Bangladesh is not founded
on a water-tight, formal structure. It is a mix of formal and informal
activities and in that, it caters to the needs of collaboration and
participation among public sector agencies related to trade, finance,
investment on the one hand and on the other chambers, trade
associations and other stakeholders in the private sector. Depending
on the nature of the job, the collaboration of network members can
further be identified as proactive and reactive.
Networking: Formal:
Formal networking refers to collaboration among key
players in certain priority areas of policy formulation and
implementation through various forums, such as – special committees,
taskforce, product-specific/sectoral councils etc. Networking through
these forums is well structured and is very much integral to strategic
planning and implementation. All the stakeholders are accommodated and
the functions and the mode of operation are also stipulated.
Activities undertaken through these forums in the
shape of formal networking mainly correspond to:
- formulation of the national Export Policy;
- formulation of incentive package for export and
export-related import and investment;
- establishing linkages for export finance and other related
fiscal and tariff matters;
- establishing linkage among relevant authorities for export
facilitation;
- reviewing country’s export situation on a regular basis
and suggesting and adopting measures for strategic
adjustments as and when necessary;
- adopting measures towards remedying odds and
export-distorting bottlenecks at home and abroad;
- holding product-specific meetings for supply side capacity
building and overseas marketing.
Some of the key forums responsible to take care of
the aforementioned issues are:
- Export Promotion Council (EPC) : A broad – based forum
comprising participation from all relevant public and
private sectors headed by the Hon’ble Commerce Minister
for formulation of the national export policy, overall
strategic planning and establishing linkage for export
facilitation.
- Taskforce on Export: A body headed by the Hon’ble
Commerce Minister comprising representation from relevant
ministries and leading chambers and trade associations to
address issues of immediate concern.
- National Committee for Export : Headed by the Hon’ble
Prime Minister, the highest body comprising high level
representation from public and private sectors to review
export situation and take instant measures towards remedying
odds.
- Sectoral Councils : Product based sectoral councils headed
by the Secretary, Ministry of Commerce to take care of the
promotion and marketing of major export products like frozen
fish and leather. More such product-specific councils are in
the process of being introduced. These councils comprise
sectoral representation a well as relevant public sector
representation.
Networking : Informal :
Informal networking corresponds to a mode of
collaboration, grown out of the need for interaction among key players
in the day to day activities, and hence it cuts across a widely
diverse range of activities. To name some such activities:
- sharing of business information, where the pivotal role is
played by the Export Promotion Bureau;
- organizing of seminars/workshops by Export Promotion
Bureau and leading chambers with participation from
concerned agencies in the public and private sectors;
- receiving and dispatching business delegations and
marketing missions;
- organizing of Dhaka International Trade Fair (DITF) and
product-specific fairs at home and participation in overseas
trade fair by EPB through close collaboration with the
private sector;
- facilitating off-shore marketing with the active help and
participation of the diplomatic missions abroad;
f) framing of country strategy through core
groups engaged by the Ministry of Commerce on multilateral (WTO
in particular), regional and bilateral trade issues.
g) a host of other activities calling for
readjustment measures and initiating newer ones to remove
barriers and facilitate trade
Proactive and Reactive Networking:
Within the span of formal and informal
networking, collaboration among network members may be identified
as proactive and reactive. Those proactive relate to initiations
in the areas of policy formulation, time-to time strategy planning
etc. Reactive activities, on the other hand, calls for
adjustments, and actions in response to emerging situations in
order that trade-distorting incidents are tackled and flow of
trade is sustained. Quite a few cases of successful reactive
networking in recent times demonstrate the efficacy of Bangladesh’s
trade support network. One such case of successful networking
relates to export of apparel products. High incidence of textile
visa forgery had been a matter of grave concern for Bangladesh for
quite sometime. Efforts undertaken from time to time to address
this problem did not produce any fruitful results. Finally, an
integrated approach was adopted through collaboration among public
sector agencies, trade associations, Bangladesh trade mission
abroad and Government of the USA. This led to the establishment of
a mechanism, known as " ELVIS " (Electronic Visa
Information System) that became effective from 1 January 2000. The
establishment of this mechanism has proved to be successful, as it
has reduced the incidence of fraud to a negligible margin. Another
example of successful networking relates to Frozen shrimp export
which not only earns a substantial amount of foreign currency for
the country, but is also regarded as a highly prospective sector.
About four years ago, European Union imposed ban on export of
frozen shrimps from Bangladesh on the ground of non-compliance of
product standards. This ban posed such a serious threat that flow
of trade in this sector came almost to a dead stop. This situation
called for quick and active collaboration among network members,
which include a number of ministries, departments, private sector
enterprises and even trade mission abroad. Excellent reactive
networking at that time among all relevant agencies helped
considerably in the adoption of an integrated approach at
infrastructure development and quality assurance. The result was
that the EU ban on frozen shrimps was lifted within a period of
seven months ensuring flow of trade from Bangladesh to European
Union in this product. It would not be out of place if another
example of successful networking is mentioned here. It relates to
the issue of child labour. The USA, which is a major destination
of Bangladesh’s apparel export, threatened that it would ban
import of apparel product from Bangladesh if employment of
children in the apparel industries was not stopped forthwith. The
US threat came as a great challenge for the emerging apparel
industry of Bangladesh. Integrated initiative involving a number
of public sector agencies and trade associations successfully
eliminated child labour from this sector. This success story of
effective networking is now looked upon as a model for those
countries where child labour still exists.
Priority Areas of Networking:
Given the wide ranging issues on which network
members are to interact, the need for prioritizing has called for
a number of specific issues where collaborative activity is of
great importance. Some of these issues on which the trade support
network in Bangladesh is currently at work, include:
- Market access;
- Trade related infrastructure development including port
facilities, telecommunication, shipping etc;
- Strengthening backward linkage of the apparel sector;
- Conformity requirements with the WTO system as regards new
rules and regulation;
- Information technology.
Concluding Remarks:
Trade support network in Bangladesh is a
growing area of activity, ranging across macro planning to
micro-level decision making. Large-scale liberalization in almost
every sphere of the economy has brought forth greater scope for
collaborative networking, rendering it inevitable in the
dispensation of trade activities. The country’s annual average
export growth at more than 12% is largely attributable to the
dynamics of supportive networking. There is indeed scope for
improvement by way of restructuring and strengthening, and the
government is keenly receptive to such needs.
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