UNNExT workshop on Paperless trade facilitation for Small and Medium-sized Enterprises

Transcription

1 UNNExT workshop on Paperless trade facilitation for Small and Medium-sized Enterprises 2-4 February 2015 United Nations Conference Center (UNCC) Bangkok, Thailand ACJ Cl

2 ACJ Cl By Mohammad Farhad Research Fellow, Bangladesh Foreign Trade Institute

3 Objective of the Presentation 3 Briefly discuss Bangladesh s Participation in International Trade and role of SMEs To provide an overview of implemented and ongoing Trade Facilitation reforms specially for SMEs in Bangladesh To discuss future Trade Facilitation Challenges for Bangladesh

4 Introduction 4 Bangladesh has posted a robust and resilient economic performance over the past decade, accompanied by a sustained decline in poverty. The average annual real GDP growth of the Bangladesh economy during the last ten years was over 6%, aided by conducive macroeconomic policies, strong export growth and favourable weather. GDP growth was broad based with agriculture, industry and service sectors performing well. Export-led growth, largely induced by increasing ready-madegarment (RMG) exports and remittances from overseas workers, have been the drivers for Bangladesh s economic development in the past decades. Poverty declined from 57% of the population in 1990 to 31.5% in 2010 and estimated at 25.6% in 2014.

5 Introduction 5 Bangladesh s involvement in international trade has been increasing significantly in the past decades, with export values more than quadrupling in the period 2001/02 to 2011/12 and the ratio of total trade to GDP accounting now more than 50% of GDP. However, comparing the trade to GDP ratio with other countries in the region, it shows that there is still room for improvement, which confirms Bangladesh s strategy of accelerating economic growth by increased and diversified exports, including increased services exports, resulting in deeper integration into global trade.

6 Introduction 6 Overview of Bangladesh s International Trade Trade (% of GDP) GDP growth (annual %) Imports of goods and services (current billion US$) Exports of goods and services (current billion US$) Source: World Bank

7 Overview of Trade Performance of Bangladesh (Import) 7 40, , , , , , , , % 60% 40% 20% 0% -20% -40% US$ Million Percentage Financial year Import Growth

8 Overview of Trade Performance of Bangladesh (Export) % % 60% % % 30% 20% % % -10% 0-20% Percentage Financial Year Export Growth Million USD

9 Contribution of SMEs to the Bangladesh Economy 9 In Bangladesh, 90 per cent of the private sector enterprises are SMEs and about per cent of non-agricultural workforce is working in the sector. The SMEs contribute up to 25 per cent of GDP including about 40 per cent of gross manufacturing output and employed around 25 per cent of the total labor force. The services sector is primarily composed of SMEs responsible for the bulk of employment growth. SMEs contribution to national export is also significant through different industries such as ready-made garments, jute, and leather etc.

10 Bangladesh s trade facilitation performance 10 Source: OECD 2013

11 Trading Across Borders in Bangladesh 11 Summary of procedures and documents for trading across borders in Bangladesh Source: Doing Business 2014 Bangladesh

12 Trade Facilitation Reforms implemented in Bangladesh 12 Bangladesh has 2 seaports, 1 internal container depot (ICD), 3 airports for international transaction of goods and 28 Land Customs stations. However, more than 90% of internationally trade goods are carried by sea. All rules, regulations and statutory orders are published Any changes made during budget are also available via internet Import licensing system was abolished back in 1985 for all products other than the products which require special import permit for health, environment, SPS and other reason. While 25 signatures were required for clearance of import and export consignments in 1999, the number is reduced to 5 at present and Customs is trying to further reduce the procedure and release time by automation. Initiative was taken to introduce ASYCUDA in 1992.

13 Trade Facilitation Reforms implemented in Bangladesh 13 ASYCUDA++, has been put in place in Dhaka Customs House, Chittagong Customs House (CCH), Benapole Customs House, Mongla Customs, and the Export Processing Zone. Direct traders input (DTI) has been introduced in Dhaka and Chittagong Customs Houses allowing electronic submission of bill of entry In 2009, Customs installed four container scanners at the Chittagong port to detect contraband/illegal shipments and weapons, aimed at ensuring security while facilitating legitimate trade. A selectivity system has also been implemented at the port of Chittagong, where shipments are screened against predetermined risk criteria and then processed through the appropriate channel.

14 Trade Facilitation Reforms implemented in Bangladesh 14 Chittagong Port Authority (CPA) operationalized its container management system (CTM), which has facilitated automation of import operations. The category of "green channel" imports are released with minimal documentation checks and no physical inspection, "yellow channel" imports undergo a full documentation check, and "red channel" imports that account for 10% to 12% of the total, receive full documentation and physical inspection. A post-audit system is also under development to verify the accuracy of green channel and yellow channel clearances. The Government plans to extend the system to include both imports and exports and to implement the system at other customs offices.

15 Trade Facilitation Reforms implemented in Bangladesh 15 The turn-around time at Chittagong port has, according to the authorities, improved due to various measures, including privatization of port-handling operations, introduction of modern handling equipment and introduction of CTMs. The port of Chittagong clears 40% of bills of entry in two working days or less. With assistance of UNCTAD, work has been underway to upgrade ASYCUDA++ to ASYCUDA WORLD and install the system to all Customs stations. AYCUDA WORLD has already been installed at Chittagong Customs House and DHAKA ICD. IT is centrally operated under DC-DR concept. One data center (DC) at NBR connecting all customs stations/houses with one disaster recovery (DR) site at Chittagong. Nationwide connectivity through fibre optic cables (NBRNET) from two service providers to ensure 99.98% up time.

16 Trade Facilitation Reforms implemented in Bangladesh 16 All authorized stakeholders can login from anywhere & not required to come to custom houses to submit declarations. Paperless operations introduced for bill of entry, assessment notices etc., meaning as soon as assessment is completed no print outs are given from customs. All assessed docs are sent to importers/agents directly by . Documents contain barcode to prevent frauds. This also helps importers to know when assessment is completed. The introduction of Authorized Economic Operators (AEO) and the Single Window (SW) system is under active consideration at the NBR

17 Ongoing Trade Facilitation interventions in Bangladesh 17 Government initiatives using own resource with technical support from UNCTAD : Introduction of ASYCUDA WORLD Asian development Bank: Modern and effective customs administration and/or management. USAID: Improve Trade Related Information and Transparency, Operationalize National Single Window and Enhance Supply Chain Security ADB/UNESCAP: Introduction of Trade and Transport Facilitation Monitoring Mechanism (TTFMM) IFC/World Bank: Develop National Trade Portal to make all regulatory trade related information and other information useful to Bangladeshi importers and exporters easily and readily available in a single integrated website.

18 Probable benefits of trade facilitation reforms for Bangladeshi SMEs 18 Reduced cost of transaction Reduced time Increased trade Ensuring availability of information Ensuring timely delivery of inputs required for industry and increasing productivity in the industry through proper time management. Reducing taxation anomalies Ensuring transparency in trade across the border

19 Trade Facilitation challenges for Bangladesh 19 Making The rules and regulations available to all and continue the practice Coordination among the various regulatory authorities and bringing then under one umbrella Publishing import and export procedure for specific products Advance ruling Transit procedures Institutional capacity building Ensuring same system at all customs stations especially at LCSs Resource mobilization

20 Thank you for your kind attention ACJ Cl