Sub: South Asia Subregional Economic Cooperation (SASEC) Trade Facilitation Week, Thailand

Venue: InterContinental Bangkok Hotel, Thailand

Date: March 25-28, 2013

Md. Sabur Khan PresidentDhaka Chamber of Commerce & Industry

Experiences on Trade Facilitation

Bottlenecks

SnapshotsIntroduction of DCCIBangladesh Economy –at a glanceIntroduction of SASECBenefits of Trade FacilitationTrade Facilitation Bottlenecks-ExperiencesTrade Facilitation initiatives in BangladeshDCCI-the lead private sector’s initiatives for TFDCCI Customs House Automation-a CaseWay Forward

DCCI- A prime and most active Chamber

Established in 1958 – the first point of contact for business as the first ISO Certified Chamber

Largest Chamber in the country works as one of the important economic watchdogs

Represents largely in the SME sector 14,000 members (Approx.), Multi sectoral business

constituencies Contributed largely for Private sector-led growth More than five decades of services to the private sector

achieved several successes & recognition both at home and abroad

Present Status of Bangladesh Economy

GDP at current price US $116 billion, 6.32% growth rate

GDP Composition: Industrial Sector 31.26 percent Agriculture 19.29 percent Service Sector 49.45 percent

Exports US $ 24.28 bn, Imports US$ 35.51 bn Remittance US $ 12.84 bn(increasing gradually) Foreign Exchange Reserve US$ 10.36 bn FDI Inflow US$ 1.13 bn Government Revenue US$16.62 bn Gross Investment is 25.45% of GDP

Present Status of Bangladesh Economy (2011-12)

SASEC

South Asia Sub-Regional Economic Cooperation

(SASEC) was set up in 2001 as an initiative of

Bangladesh, Bhutan, India, and Nepal.

Aims to promote domestic and regional prosperity

through stronger transport links and increased

trade and cooperation across sectors ranging from

energy, tourism, the private sector and the

environment

Trade Facilitation and SASEC

Trade Facilitation can help to achieve higher growth and economic development in SASEC countries

Trade Facilitation, can create possibility to go for more industrialization by expediting the movement, release & clearance of goods including goods including transit.

It is of course true that Trade alone can not create employment if it is not supported by the Domestic Policies.

Benefits of Trade Facilitation

TF not only help in having monetary gains, but increasing transparency, reducing cost of doing business & increasing business opportunity

It amplified customer value & improved security and increased revenue

SMEs in relation to larger companies are benefitted and can grow more efficiently

Trade Facilitation Bottlenecks

Key elements of Trade Facilitation

It is imperative that four key elements are present for a successful trade facilitation process:A strong political will;A clear strategic plan;A close co-operation with the business community;A well-funded and long-term technical assistance

program based on a partnership between donor and recipient.

Trade Discouraging NTBs faced by Business

Processing or clearance delays at borders or portsLack of transit and transport agreementCompliance with sanitary and phyto-sanitary (SPS)

standards Technical barriers to trade (TBT)Weak logistics systemsPoor infrastructure High administrative fees, storage and handling costs Limited IT usageLack of accreditation facilitiesExcessive documentationLack of cooperation and coordination among trade

supporting organizations

Possible NTBs in Trade in Services

Thresholds on the total value of service transaction

Restrictions on the number of service operations

Limits on the number of natural persons to be employed in case of supply for a particular service

Measures which force a service supplier to supply a service  through a particular set of legal means

Limits on the percentage share of foreign investment which  may  be  accounted for by foreign shareholders 

Trade Facilitation Bottlenecks..Limited information about overseas markets and

marketing consumers goodsAdditional market entry barriersLack of attention behind and between bordersAbsence of comprehensive Aid for Trade AgendaBarriers to the international markets of goods and

procedures at and around the bordersSkilled human resources and technologyCost of trading remains high-prevents potential

exporters competing in the global and regional markets

Trade Facilitation BottlenecksCompliant with the TF Measures is almost impossible

for an LDC country like BangladeshAmong the 39 Measures some of the provisions have

partially been addressed but some provisions are very difficult to implement, such as; Detention, Test Procedures, Pre arrival processing, Establish and publication of average release time, Border agency cooperation, Use of international standards , Single window, Customs cooperation etc etc which will need more time.

Issues of Advance Ruling, Risk management issues also are similarly important and will require time

TF Bottlenecks contd…As an LDC Bangladesh has already identified

their Trade Facilitation Needs and Priorities and is trying to address these issues while the cost implications of these proposed measures is huge

Bangladesh needs to identify what type of Technical Assistance and support for Capacity Building is required to be compliant with these measures

LDCs are already suffering for infrastructural bottlenecks, Bangladesh is not an exception

Trade Facilitation Initiatives

Trade Facilitation Initiatives

Bangladesh has already pursuing liberalized trading regime

Customs procedures have been simplified & modernized substantially.

Infrastructure & facilities at different customs points, different sea & land ports have been improved.

Ministries have their own websitesASUCUDA ++ is also in place, ASUCUDA

World in in processChittagong Port is under several reforms.

Cont...Full Automation of Chittagong Customs

House & Automation of Dhaka Customs House

PSI has reduced physical inspection of consignments, from 100% in 1999 to around 10% now.

Number of pre-clearance signatures has gone down to 5 from 25, & export clearance time for 95% of consignments has been reduced from 72 hours in 1999 to 3 hours now

Appointed Tax Ombudsman to facilitate good governance in Tax & Tariff measures.

Cont...

New-mooring Container Terminal (NCT) at Chittagong Port is under construction.

It will ease the current vessel and container congestion a lot

Government and Private sector is working very closely

Initiatives for TF by DCCI

Dhaka Custom House AutomationTraining through DCCI Business InstituteEstablishment of a Public-Private Dialogue called

Business Initiative Leading Development (BUILD)Close interaction with government agencies

(Bangladesh Tariff Commission, NBR, EPB, Ministry of Commerce etc.) which are working for trade facilitation

B2B Matchmaking activitiesIssuance of Certificate of Origin (CO)Policy Advocacy and ReformsInitiatives through different projectsDCCI Help DeskMany more....

A TF case of DCCI under PPP-DCHA

DCCI in partnership with National Board of Revenue (NBR) has been implementing the project on Dhaka Customs House Automation (DCHA) under Public Private Partnership (PPP) model with a view to reduce cost of doing business, reduce bureaucratic tangles, reduce cumbersome process of paying taxes, create a hassle free business environment and increasing revenue by ensuring transparency

and accountability.

Contd..DCHA Benefits

Improved efficiency, save time for each stakeholder, improve productivity, accountability and compliant to WCO definition by introducing world class IT infrastructure

Reduced cost of doing business by at least 70%

Saved customs processing time by 80%

Cutting down the customs procedures to 6 steps in the place of existing 31

Monitoring international and domestic price

Transparency and level playing field ensured

Minimized risk & ensured better service delivery of the custom department

The way forward

The Way Forward

Harmonization of trade documents Adoption of the HS nomenclature and use of

internationally agreed standard data elementsOnline publication of relevant trade regulations and

procedures, including fees and charges, in the local language and in English

Establishment of a national trade facilitation committee,

Establishment of enquiry points and single national focal points for trade regulations and other trade facilitation issues, and

An effective appeal procedure for Customs and other agencies rulings.

DCCI is looking for support

Help Desk in the Chamber with connectivity of all relevant trade supporting organization

Integration with the National Information Centre

Full operation of DCHA

Thank You For Your

Patience Hearing