Bangladesh has to develop its negotiation skills in international trade, World Trade Organization (WTO) matters and relevant international laws for win-win trade deals, and maintaining a strong position in economic diplomacy, said the Dhaka Chamber of Commerce and Industries (DCCI).
Its president, Rizwan Rahman, said on Sunday that the major export destinations of Bangladesh are Europe and America, which covers almost 67% of total export, while Africa and Middle East still remain untapped.
He was presenting a keynote paper during a press briefing on contemporary economic situations at the DCCI head office in the capital.
During his speech, Rahman also said that after Bangladesh's LDC graduation, export will face a challenge and for that, the country has to formulate export diversification strategies by engaging all stakeholders.
Tariff rationalization, reduction of non-tariff barriers in cross-border trade and minimizing anti-export bias are also important in this regard, he said.
In 2020-21, private investment came down to 21.25% of GDP, but in 2021 FDI was $2.51 billion.
In order to revive private investment and FDI, he suggested rationalizing corporate tax structure, equipping economic zones, and forming a national roadmap.
The DCCI president also stressed for automation of overall taxation, VAT, audit, arrears management, investigation and inquiry, appeal, revenue account management, taxpayer account management and revenue information management.
He also said that "survive, revive, and thrive" will be the road to recovery this year.
The keynote also identified the prioritizing sectors such as the CMSME sector, as well as export diversification, blue economy, economic diplomacy, infrastructure, private investment and FDI, skills development, digital engagement, taxation, and LDC graduation.
According to the keynote, CMSMEs include 80% of industrial employment.
Contributing 25% to the national GDP, currently there are 7.8 million CMSMEs in the country.
He urged that the government needed to develop a comprehensive policy framework, while revisiting the definition of CMSME, as the sector should get priority especially in terms of easy access to finance.
The keynote said that due to 4IR, 5.5 million workers may lose their job by 2041.
Moreover, there are 47% unemployed among educated people.
“To cope up with the growing demand of future skilled workforce, we need more investment in research and development, re-skilling and upskilling,” he added.
Potential sectors
Blue economy is an emerging sector for Bangladesh, he said that Bangladesh’s ocean economy stands for 3.1% of the country’s overall GDP.
However, shipbuilding, tourism, sustainable fishing, gas and mineral explorations largely remain unutilized.
Rizwan Rahman urged for creating a national roadmap for the development and implementation of the blue economy.
Answering a question, he said that only automation can remove corruption and hassles, as well as ensuring transparency and accountability.
Regarding corporate tax rate, he said that DCCI still advocates for reducing it at a progressive 2.5% per year for the next three years, so that by the time Bangladesh graduates from the LDC category, the rate is on par with the regional average tax rate of below 25%.
On smooth disbursement of stimulus to the SMEs, he said that more than 53% has been disbursed but if Bangladesh Bank can specify the percentage of loan that CMSMEs should get then the banks will follow it accordingly.
Regarding questions on signing of preferential and free trade agreements (PTA and FTA) ahead of LDC graduation, he said that FTA is more effective and beneficial than PTA, so Bangladesh should try to focus more on signing FTAs.
It is heartening that the government allows offshore equity investment but it should be more open, not only for the export retention quota (ERQ), but for non-ERQs as well.
Throughout 2021, the economy indicated some positive growth trends in some major indicators like export, remittance and private sector credit, the DCCI president added.
DCCI Senior Vice-President Arman Haque and Vice-President Monowar Hossain were also present on the occasion.