Diversification is long overdue

The recent news of exports decreasing for the month of October is concerning and puts Bangladesh in a challenging position. Bangladesh earned $3.76 billion last month, a 13.46% decrease from the same period of the last financial year. This, coupled with what appears to be our dwindling reserves, paint a grim future for our economy, and if necessary steps are not taken, this could spill out into a situation that we would find it difficult to recover from. 

According to EPB, exports of every sector except readymade garments (RMG) have fallen. While this can be attributed to a number of factors -- the global economic slowdown and our failure to grow and enhance our non-RMG sectors come to mind -- it is also true that experts have been speaking about these issues for a long time, and proper preparations and safeguards were not in place. Specifically, authorities and businesses alike continue to double down on the RMG sector, leaving our still nascent non-RMG sectors behind without truly giving them a proper chance. 

Yes, RMG fuels the majority of the economy, and we cannot just turn things upside down. But more needs to be done to grow our non-RMG sectors, especially with regard to the industries that have in recent times shown the most promise in helping us diversify our export basket. 

Bangladesh also would do well to follow the model of countries like China and prioritize industries such as electronics, where we have a theoretical advantage due to our wage structure.

However, without proper incentives, businessmen will continue to focus on cash cows. And if we continue down this path, the next time we take a hit to our exports and somehow lose our foothold in RMG exports, it will be difficult to stand back up and steady an already shaky economy.

The authorities need to hold dialogues with businessmen and young entrepreneurs and formulate proper incentives that will drive diversification. They also need to engage with international markets, carving out buyers for the many products that are produced in this country, not just for RMG. 

Diversification is long overdue. We cannot survive like this.