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Export contribution to GDP declining

  • Published at 01:18 am September 22nd, 2016
Export contribution to GDP declining
Trade analysts and business people have blamed that slow growth of export compared to the economic growth, higher dependency on Ready Made Garments (RMG) and decreasing the export on other sectors are the causes of export decline. According to Export Promotion Bureau (EPB) data, in the last fiscal year Bangladesh earned Tk2,66908.44 corer, which is 15.50% of total GDP of Tk17,29567 corer. As per the provisional data of Bangladesh Bureau of Statistics (BBS), Bangladesh GDP stood at Tk17,29567 corer in the last fiscal year. Of the total GDP, 14.75% came from Agriculture sector, 28.56% from Industry sector and 56.69% from service sectors. “Bangladesh export earnings are driven by apparel sector and 82% of export earnings came from the sector. While, the other export oriented sectors are not performing well. That is why, export contributions to GDP is not increasing in line with the growth of economy,” Faruq Hassan, president of Bangladesh Garments Manufacturers and Exports Association told the Dhaka Tribune. “Currently the export sector is highly dependent on RMG sector, which produce mostly basic and low rate products. The sector contributes to the GDP is over 10%. For more contribution, the government has to concentrate on product diversification and value addition,” said Faruq Hassan. “Export contribution is directly linked with the employment generation and play an important role. That is why, for increasing the export in terms of value and creating more jobs for people, people oriented with the sectors have to concentrate on value addition,” said trade expert. “While, high value items like pharmaceutical, shipbuilding and diversified jute products should bring in consideration as it earn more than tradition and low cost products,” the added. Professor Mustafizur Rahman, executive director of Centre for Policy Dialogue said.“If the export growth is less than the real GDP growth, it is a matter of concern and we have to think about it,” He also suggests to measure GPD on basis of dollar to picturesque the real scenario. Contacted, Commerce Minister Tofail Ahmed said: “The government has taken initiatives to diversify export basket to prompt export oriented sectors in aiming to enlarge export volume,” . “As a part of government initiatives, we are providing cash incentives to pharmaceutical, agriculture and leather sector,” the minister said. Adding that,  the government has given more importance on products and market diversification in the six or five years plan he said: “Bangladesh is gradually entering into the export of value added products and I think, pharmaceutical sector would able to earn $5 billion in next five years, while IT sector will earn $1 billion by 2018.