Exporters in Bangladesh said mismatch between Export Promotion Bureau (EPB) and Bangladesh Bank’s (BB) export data was the result of hiding the true numbers by inflating export earnings.
Once the central bank used the International Monetary Fund (IMF)'s BPM-6 approach and made this data available, many began to notice the discrepancy between this data and EPB’s.
Exporters said as the Export Promotion Bureau (EPB) is responsible for publishing export data, the institution should have been more cautious and transparent in publishing the numbers as overstated data ultimately impacted them.
Industry insiders also said that along with the EPB's exaggerated data, the invisible balance was not submitted to Bangladesh Bank, hence unnecessarily drawing allegations like money laundering.
They had been expressing concern over EPB's export data, saying that it did not accurately represent the volume of trade they were seeing.
Behind this mismatch
On Wednesday, officials of the central bank said the EPB publishes figures based on the data from the customs department. Due to procedural reasons, the customs department took into account the same export data more than once in many cases, which is known as double or triple counting.
They said that even when shipments were rejected by the customs, they were still considered while preparing the export data. As a result, the EPB data showed higher exports than the actual sales in the global markets by local exporters. The gap has been adjusted as per the recommendation of the IMF's $4.7 billion loan program.
A major discrepancy was found in the export data published by EPB and as a result, the National Board of Revenue (NBR), Bangladesh Bank and EPB jointly decided that the data by NBR will be considered as the final data in the case of exports earnings.
However, due to this decision, the export earnings of the country decreased significantly, which was shown as inflated in the EPB data.
According to the Balance of Payment data published by the central bank on Wednesday, the export earnings of Bangladesh in July-April period of FY24 stood at $33.67 billion, a decline of 6.8% from $36.14 billion from the same period in FY23.
According to the EPB data of July-April period of FY24, the merchandise export earnings of the country was $47.47 billion, which was 3.93% higher than $45.68 billion.
This indicates a major discrepancy in the export earnings of the country, meaning the EPB may have declared surplus export earnings amounting to $13.8 billion.
The readymade garment (RMG) sector, which makes up the lion’s share of Bangladesh’s export sector, earned $29.68 billion in July-April of FY24, which is 6.7% lower year-on-year, said the corrected export data.
However, the EPB declared that the sector earned $40.49 billion with a 4.97% year-on-year growth.
Industry insiders said that although the EPB collects preliminary data from the National Board of Revenue (NBR), the central bank has just started gathering data using the BPM-6 approach as per the prescriptions of the IMF.
What exporters say
Exporters said that they had been saying this for a very long time, that EPB data was fabricated.
But their views were not taken into account. Finally, the real facts have been revealed, they also said.
Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said that he has been talking about this since 2022.
“In November of 2022, exports crossed $5.13 billion, then the highest export in a single month in the history of the country. But we did not export so much then. I didn't know how export increased to such heights,” he also said.
Then, exports were shown at the $5 billion mark for several months which was incorrect. He went on saying that the data proved that exporters were not in a good condition now.
He also said that the EPB misguided the government, businesses, the nation, as well as the international community by providing misinformation. Those behind such fabricated data must be punished.
Talking to Dhaka Tribune, Md Nasir Khan, vice-president of the Leathergoods and Footwear Manufacturers and Exporters Association of Bangladesh (LFMEAB), said that the monthly EPB data just shocked them.
“The condition of industries was shaky, while production declined regularly. But we didn’t know how exports kept increasing each month,” he added.
He also said that this misinformation affected the industry and its stakeholders.
Such an erroneous show of inflated export data by a responsible organization is unexpected and frustrating, he added..
Mohiuddin Rubel, director of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told Dhaka Tribune that the fabricated export data concealed the real situation of the industry.
“As the actual situation was concealed, it prevented us from planning for the future. If we know the actual situation, we can bargain with buyers, can prepare for a future groundwork, entrepreneurs wouldn’t expand the industries and the new entrepreneurs wouldn’t invest,” he added.
Now the industry in a “zero” position, he went on saying that as per government rules, they are dependent on EPB for data, but if they provide fabricated and exaggerated data, then it is unexpected and ultimately hinder the industry.
The industry insiders also said that for a long period, there was more than a $10 billion gap between the export data provided by the EPB and the central bank, and based on the EPB data, various parties have been blaming them of laundering money under the guise of exports.
Ahsan H Mansur, executive director of the Policy Research Institute (PRI) said the export data has been miscalculated and it should have been fixed earlier.
“The revision in the BoP is the result of this change in accounting methodology. Now, it's clear how well our exporters are doing. But due to this, the financial account turned positive but the current account went negative again. So, it is not good news for us,” he added, saying that although there are some positive signs in the economy, it will take some time to bring down inflationary pressure.
EPB unwilling to take the blame
However, it was not possible to get an official statement from any official of EPB in this regard.
This reporter was unable to reach EPB Vice-Chairman Anwar Hossain despite repeated attempts.
Contacted, EPB Secretary Bibek Sarkar said the matter was beyond his jurisdiction, and asked to contact Abu Mukhles Alamgir Hossain, director of policy and planning, but he was also unavailable despite multiple calls.
Md Akhtaruzzaman, deputy director of the policy and planning wing, said: "Contact the director. I am busy with other work,” before hanging up.
However, an official of EPB, requesting anonymity, said that they collect data from the NBR as well. It is provisional data and they mention this in their monthly export data reports.
“I cannot tell you something more as it is beyond my jurisdiction. However, discussions are going on among us at the office and we will be able to provide an official statement soon,” he added.
Meraj Mavis also contributed to this story