Published:  02:05 AM, 03 February 2022

Immediate measures required to save export market

Govt must work hard to restore fair image

Immediate measures required to save export market
The United States of America has recently imposed embargoes on some law and order officials of Bangladesh including the Director General of Rapid Action Battalion (RAB) and Inspector General of Police (IGP). This phenomenon has generated worries among the business community of Bangladesh, particularly traders involved in the readymade garments (RMG) sector.

Bangladesh's RMG export volume to the United States has exceeded 6 billion dollars. Bangladesh's RMG export volume to the European Union (EU) is nearly 10 billion dollars. It should be noted that RMG exports and remittances from abroad are the two indispensable pillars on which Bangladesh's economy stands.

Bangladesh's remittances from foreign countries have gone down in recent times. Remittance from Saudi Arabia has dropped by 21% during last six months. Remittance from UAE has declined by 41%. Remittance from United Kingdom has decreased by more than 15%. Remittance from Qatar has gone down by around 10%. Remittance from Malaysia has nosedived by nearly 55%.

Financial experts have stated that the US sanctions have come as a strong signal from the United States that Bangladesh will have to pull up its socks in terms of good governance, democracy, freedom of expressions, freedom of press and human rights.

Freedom of press is a vital factor. A number of journalists in Bangladesh have meanwhile come under repression due to the application of the Digital Security Act. For this reason some aspects of the Digital Security Act are often debated.

Bangladesh was not even invited to the Summit for Democracy which was held in the United States in December 2021. The sanctions on the RAB officers and police chief have been enforced over allegations of extrajudicial killings and human rights violations. RMG buyers from the United Kingdom have added a clause to their letters of credit (LCs) that they will not take any liability if their payment of bills is delayed due to sanctions imposed on the exporting country by the United Nations, United States, European Union or any other international organizations.

Analysts have commented that Bangladesh is most likely to get deprived of generalized system of preferences (GSP) facility in some European countries because of the sanctions. 63% of Bangladesh's total exports are dispatched to the United States and European Union. It may be recalled that over one thousand garments workers were killed in the collapse of Rana Plaza in Savar in April 2013. Pope Francis said following the occurrence that garments workers in Bangladesh are subjected to slavery.

The European Union has meanwhile declared that it would closely observe the upcoming national election of Bangladesh. It is an indication that the European Union wants a free, fair and credible election to be held in Bangladesh.

Money laundering from Bangladesh to foreign countries has increased on an unnaturally egregious scale, financial sources have informed. Reportedly 4 lakh 36 thousand crore taka (4965 crore dollars) have been illegally transferred from Bangladesh to overseas locations during last six years. On an average every year nearly 73 thousand crore taka is being laundered from Bangladesh to foreign destinations.

Bangladesh is now facing a trade deficit of 9.09 billion dollars.

Money laundering is one of the major reasons behind the burgeoning trade deficit in the country. Besides, a big portion of the laundered money is being spent for financing militants, terrorist organizations and separatist groups in various countries.

Financial experts have said that the list of the top money launderers of Bangladesh and the amounts they transferred abroad illegally should be exposed. At the same time required steps should be taken by Bangladesh government without delay to retrieve the laundered funds from overseas, economists have commented.

Bangladesh's banking sector is inflicted with nearly 2 trillion taka defaulted loans including written off debts. Economists have remarked that most of the defaulted loans might have been laundered to overseas locations.

Financial sources have said that Bangladesh became a member of Egmont Group headquartered in Canada in 2013 to exchange information about money laundering and terror finance. Egmont Group has 147 member countries. Bangladesh can seek cooperation from Egmont Group for bringing back laundered money.

President of Bangladesh Garments Manufacturers and Exporters Association (BGMEA) Faruque Hassan said, "We are working on this issue with our business partners abroad. I hope the US sanctions on some law and order officers will not affect our business. At the same time we are working hard to ensure a congenial atmosphere inside all garments factories."

Former adviser to caretaker government Dr. Wahid Uddin Mahmud said, "Bangladesh government should take up immediate and effective measures to streamline banks and financial institutions. Strong steps should be taken to stop money laundering as well."

Professor Anu Muhammad of Jahangirnagar University said, "Corruption has tremendously increased in Bangladesh. Bangladesh has turned out to be the most corrupt country in South Asia right after Afghanistan. It is a very poor reflection of the government's willingness to fight graft and anomalies."

Director of Bangladesh Environmental Lawyers Association (BELA) Syeda Rizwana Hasan said, "There is lack of good governance and integrity in many sectors of Bangladesh. The government will have to work hard to restore a fair image to avoid further embargoes."

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