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Identifying opportunities in a potential market

  • Published at 12:34 am October 29th, 2018
Bangladesh can become one of the top suppliers of goods and services to the UN Reuters

Bangladesh has the potential to capture a lot more business in the United Nations System

The United Nations has been working across the globe to maintain international peace and security, develop friendly relations among nations, and promote social progress and better living standards and human rights. For its various functional activities, the UN procures a wide range of goods and services from around the world. 

The UN Procurement Division (UNPD) is responsible for such procurements. The UN Global Marketplace (UNGM) is the procurement portal of the UN System. It brings together UN procurement staff and the supplier community. 

Moreover, the UN has the UN-Business Action Hub, which is a platform where businesses can learn more about UN entities, their mandates, specific needs, and offer program support, in-kind and financial donations, while UN entities can learn more about the specific interests of companies, available resources, and engagement opportunities desired by businesses.

The UN procured goods and services were worth $18.6 billion in 2017, with an increase of 5.1% or $910m, compared to that of 2016. The UN represents a global market of over $17bn annually for all types of products and services, which is a huge market to tap into. 

The year 2017 saw an increase of $636m (26.5%) to $11bn in procurement from least developed countries (LDCs) and transition economies, compared to that of 2016, representing 16.9% of total UN procurement volume for the year. 

The UN has been an inseparable part of Bangladesh’s history. Ever since 1974, Bangladesh has been a member of the organization that has gone a long way with regards to helping us with some of our burning issues. 

One of the most groundbreaking agreements between the UN and Bangladesh took place back in 2016. United Nations System in Bangladesh signed an agreement, known as the UN Development Assistance Framework (UNDAF) 2017–2020, with the Bangladesh government, pledging $1.2bn. 

The UNDAF is a commitment of partnership among the UN agencies to plan, work, and deliver together to assist the government in achieving the seventh five-year plan, and in reaching the Sustainable Development Goals (SDG) with an aim to “leave no one behind.”

Procurement from Bangladesh by UN in terms of value of goods and services procured has increased by 60.4% from the year 2016 to 2017, with the total procurement value being $68.14m, 0.37% of all UN procurements.

Bangladesh was the 47th largest country supplier to the UN system in 2017. 990 companies in Bangladesh are registered on UNGM as potential suppliers for the UN, and 55 companies are a part of the UN Global Compact. 23 different UN organizations procured goods and services from the country in 2017. 

Moreover, Bangladesh happens to be the second biggest contributor of military and police to UN Peacekeeping. With the country’s developing industry and services sector, and the imminent graduation from an LDC to a developing nation, and not to mention an increasing trend of UN procurement from LDCs and developing nations, Bangladesh holds huge potential to capture business in the UN System. 

Nearly 85% of the UN procurement is for peacekeeping missions, which is a promising sector for Bangladesh in capturing procurement tenders, being the second largest contributor of troops. The business community of the country could explore the untapped opportunities in areas such as apparel, halal food, pharmaceuticals, canned food, plastics, IT, engineering, construction materials, chemical products, freight forwarding, and delivery, food rations and catering, and travel and aviation. 

Bangladesh’s aviation industry can also grab a large volume of market share through chartered airline services for carrying peacekeepers. Since we are becoming increasingly visible in the world in terms of quality products and businesses, being enlisted in UNGM could prove to be the much-needed start.

In order to mitigate the loss of exports due to preference erosion resulting from Bangladesh’s graduation from an LDC, Bangladesh should attempt to diversify its exports, and increasingly supply goods and services to the UN. 

This would necessitate the support of government agencies, the defense sector, and the private sector of the country. The government, through its various agencies, can make the export environment in the country more favourable towards large and small enterprises alike, and provide incentives in the form of subsidies to promote the local supplies to the UN. 

The defense sector can play a major role here, due to its presence at the UN peacekeeping missions. In addition, the private sector can contribute to this cause by developing prospects, and taking initiatives of capturing the exports market to the UN. 

The business chambers can train, familiarize, and encourage their members to do business with the UN, and ensure relevant policy support. This would ultimately help our economy flourish. 

Last but not least, the local financial institutions can also assist the suppliers by providing credit at convenient terms to incentivize initiatives of exports to the potential markets presented by the UN.

Given necessary support is provided by the concerned actors, Bangladesh holds the prospects and capabilities to become one of the top suppliers of goods and services to the UN. 

In particular, the country’s apparel, pharmaceuticals, plastic, canned juice, and packed food sectors show lots of promise. To ensure that promise translates into results, our government, defense sector, and more importantly, the private sector, need to put their best acts together. 

Mamun Rashid is a leading economic analyst. This is the excerpt of his keynote speech in a recently held conference jointly organized by Bangladesh Institute of Peace Support Operation Training (BIPSOT) and FBCCI.

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