Press Release

Business Initiative Leading Development (BUILD) Chairperson Abul Kasem Khan paid a courtesy call on the newly elected President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Md. Jashim Uddin, on 31 May 2021 at the FBCCI Secretariat.

BUILD Chairperson said that under the dynamic leadership of the new FBCCI President leadership, further development of business and industry in the country would be realised. BUILD Chairperson said that FBCCI President’s guidance during the pandemic would be essential for our business community. Referring to the MOU signed between FBCCI and BUILD in 2015, BUILD Chairperson requested support from FBCCI for collaboration.

FBCCI President Md. Jashim Uddin said FBCCI would accelerate private sector growth and give the highest priority in resolving the many challenges faced by businesses. He stressed the need to strengthen research and innovation as these would help reach the 2041 economic vision for the country.

BUILD CEO Ferdaus Ara Begum also welcomes the new President as the Co-chair of the Taxation Working Committee of BUILD and requests his support and guidance.

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The Bangladesh Standards and Testing Institution (BSTI) is keen to align its efforts with international standards for which it is already working with academia to have research-based product standardisation and upgrading its capacity by setting up new laboratories to ensure proper testing and standards certification for a variety of sectors, said Dr Md. Nazrul Anwar, Director General of BSTI. On Tuesday, 25 May 2021, he was speaking at a Virtual Dialogue on Identifying the Challenges and Measuring Gaps of Present Standardisation Capability in Bangladesh for Export Potential Products.

Business Initiative Leading Development (BUILD), in collaboration with IFC-WBG, organised the webinar.

He also said that BSTI has taken two projects on setting up 90 laboratories for product standardisation and certificate issuing and establish its logistics infrastructure in 10 more districts.

However, it takes six months to complete the adaptation of international standards; it takes more than three years to set a product standard. Thus, global product standards adaptation is more time saving than setting up new product standards. BSTI welcomes the recommendations and suggestions from the private sector. Close coordination among the stakeholders will help the government to reach the export target, export market expansion and export diversification, said he.

While moderating the dialogue, Ferdaus Ara Begum, CEO, BUILD in the beginning delineated the objectives of the dialogue informed that in order to become a successful and competitive exporter in the current global market, they must be ensured that their products fulfil the strict requirements of quality demanded by the foreign markets. In this respect, up-to-date information on technical regulations specified in standards or technical regulations set by WTO as demanded by the foreign markets is critical.

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The Bangladesh Bank has taken the initiative to extend the timeline of the current stimulus package, and by 2023, a total of BDT 60,000 crore will be extended to SMEs to ensure economic resilience that will enhance GDP, employment, and inclusive development, said Abu Farah Md Naser, Deputy Governor of Bangladesh at the Virtual Dialogue titled “Creating Resilient Recovery for Businesses through Enhancing Investment Opportunities: A Case of Southwest Bangladesh. The Deputy Governor of the Bangladesh Bank joined the meeting as Chief Guest while Sk Abdur Rahman, Mayor of the Mongla Municipality of the Bagerhat District, joined as the Special Guest. Business Initiative Leading Development (BUILD), with support from the PROKAS program of the British Council, organised the dialogue.

The Bangladesh Bank Deputy Governor mentioned that the BDT 2,000 crore collateral-free loan opportunity for SMEs made available under the credit guarantee scheme should be utilised as much as possible. He held the example of City Bank’s Leno financing model that uses digital technology to process loan applications in the shortest possible time and encouraged other banks to follow the example. For banks operating at the grassroots level, he encouraged digital technology to ensure that loan evaluation and processing can be managed in the shortest possible time. Abu Farah Md Naser thanked BUILD for organising the meeting to address the concerns of the cottage, micro, and small enterprises from remote regions. He mentioned that Bangladesh Bank is also facilitating the expansion of aggregate demand by nurturing Bank-MFI linkages that have a base of three crore people across the country.

Sk Abdur Rahman, Mayor of the Mongla Municipality, mentioned that the neediest section of the population: the cottage enterprises, fishermen and the working class have primarily missed the benefits of the package. He suggested that banks should provide not only credit but also technical support to ensure that the credit is properly utilised for repayment. Training and capacity building provided by the government at the local level need to be scaled up. He encouraged the speedy completion of the Mongla airport to ensure accelerated investment and development in the region.

In the opening remarks of the meeting, BUILD Chairperson Abul Kasem Khan noted that the COVID-19 had affected business all around the country, especially the MSMEs. The timely initiatives by the Hon’ble Prime Minister and the government to prepare the country to tackle the health challenges as well as economic effects of the pandemic combined with the all-out action by the Bangladesh Bank and other government agencies were instrumental in protecting the country from the worst consequences. Aside from supply-side interventions, there also need to be demand-side initiatives so that the income and consumption of the ordinary people can be boosted to reinject dynamism in the economy. He requested for social safety bond for the small entrepreneurs and some tax changes in the Tax policy, and extend tax incentives so that large scale industries can also be sustained.

BUILD CEO Ferdaus Ara Begum, while moderating the session informed in reply to a point raised by Bangladesh Bank that BUILD is working closely with the Ministry of Industries to get the definition of cottage, micro, small and medium enterprises to ensure that smaller and vulnerable businesses receive more policy priority and support. As BUILD continues to engage in research and facilitation of the businesses in Mongla and Bagerhat, support from the central bank will be essential.
In the keynote presentation, Md. Tahmid Zami, Additional Research Director of BUILD, noted that in the local BSCIC Industrial Estate of Mongla, around 50% of businesses are out of operation, and only 20% of workers are retained in many factories. The coconut oil mills, rice mills, small traders, and many other sectors have faced tremendous shock due to the COVID-19. Finance should be distributed to the cottage, micro and small enterprises without stringent requirements for rescuing the endangered businesses. He referred to the e-survey in the form of a KPI conducted by BUILD during February-March 2021, covering chamber representatives, local Government and BSCIC, Bank officials and Businesses.

Husne Ara Shikha, General Manager, SME and Special Credits Department informed about 6% of total money disbursed for SME have gone of Southwest region, in case of women, in number it is about 5.43% of the total and noted that there are both positive signs and mixed results in distributing credit to SMEs in the region. She mentioned that Bangladesh Bank has gone out of its way to developing a data dashboard to collect and manage disaggregated data on finance at the local level. As the finance extended under the Stimulus Package is high powered money, it cannot be continued for an indefinite period; it is essential to ensure especially state-owned commercial banks fully utilise their wide network of branches to disburse adequate credit to the remote businesses.

Syed Abdul Momen, Head of SMEs of BRAC Bank, mentioned that the definition of SMEs should be modified to target the cottage, micro and smaller enterprises more effectively. The decentralised credit management of BRAC and the agent banking sets a good example for the banking industry of the country for meeting the needs of the businesses at the rural level.

Enclosed are the press releases (in English and Bangla) for your kind consideration. Please feel free to contact us for any queries.

Cottage, micro, small and medium enterprises (CMSMEs) are the most affected segments in the private sector because of the emergence of COVID-19. In order to minimize the economic impact, the government of Bangladesh announced financial support for various sectors through stimulus packages worth Tk 1.21 million since the end of March 2020. Along with providing loans at low-interest rates, the government also took several steps to ensure breathing space for the private sector. Among these steps, halting loan classification is one of those measures.

Since 19 March 2020, Bangladesh Bank, in different phases, issued circulars on halting loan classification for all kinds of outstanding loans in order to reduce pressure on the private sector, sustain employment in the country and so on. Bangladesh Bank via BRPD circular no. 3 on 31 January 2021 said that the bank borrowers would no longer get the moratorium facility against their outstanding loans from the beginning of the current year. But due to the arrival of the second wave of COVID-19, Bangladesh Bank extended again the policy relaxation involving loan repayments to the country’s scheduled banks by their borrowers. According to the new circular, borrowers can clear their instalments on loans by 30 June 2021. For the loans whose term has expired, the unpaid interest has to be cleared in six quarterly instalments from March 2021 to June 2022. For the demand loans, borrowers are allowed to repay loans within eight instalments from March 2021 to December 2022.

However, these guidelines will not be applicable for the borrowers of the COVID-19 stimulus packages. A significant working capital loan of BDT 20,000 crore was sanctioned for the CMSMEs on 13 April 2020. So far, 72 per cent or BDT 14,360 crore of this loan has been disbursed till 11 March 2021. The deadline for implementing BDT 20,000 crore stimulus package for the cottage, micro, small and medium enterprises (CMSME) sector will not be extended. The time for its implementation will expire on 31 March 2021. There is a possibility that 28% of the fund or BDT 5,640 crore of this fund will not be utilized.

Enclosed is the press release (in English) for your kind consideration. Please feel free to contact us for any queries.

Business Initiative Leading Development (BUILD) Chairperson Abul Kasem Khan placed the budget proposals for FY2021-22 to the Chairman of National Board of Revenue (NBR) Abu Hena Md. Rahmatul Muneem on March 16, 2021. In order to revive the post COVID19 economy, BUILD placed some effective recommendations in a bid to facilitating the tax revenue collection procedure of the government, focusing on widening the tax net, corporate tax reduction, minimizing the gap of supply-side and demand-side and simplifying the tax payment procedures.

During the meeting with NBR, BUILD Chairperson said that we see no other option for increasing the Tax GDP ratio; he added the current ratio of direct and indirect tax in Bangladesh is around 35:65, which should be reversed to uphold the interest of the consumers and the productive sectors. Priorities for this year Budget should be to increase the tax-net, reduce the tax rates, simplify tax payment procedures to encourage taxpayers.

BUILD urges to reduce administration and compliance costs, ensure procedural fairness, avoid discrepancies and discrimination, ensure transparency, and build confidence in the taxpayer-citizen-client. It also demands the increased reliance on Information Technology — electronic payment facilities. BUILD asked for considering the taxpayer as a customer and facilitating compliance. It raises the importance of tax audit strategies to increase efficiency and reduce the risk of leakage. The policy paper also identifies the urgency of the segmentation of taxpayers for creating better service levels for all.

Enclosed are the press releases (in English and Bangla) for your kind consideration. Please feel free to contact us for any queries.

Business Initiative Leading Development (BUILD), in association with the Central Procurement Technical Unit (CPTU) of and the International Trade Centre (ITC) ‘s SheTrades Initiative, organised the 3rd virtual policy dialogue on “Gender-Responsive Public Procurement in Bangladesh: Interview Findings” on March 10, 2021, 2021 to increase women’s participation in the public procurement in Bangladesh.

Survey results, scored country assessment based on specific questions as developing, meaning of which is the inclusion of Women-Owned Business (WoB) in the country’s agenda is in place but not yet fully accomplished in case of public procurement. In the case of entity assessment in that respect, the current situation is marked as developed, meaning some action/administration issues have been done, but the results are yet to be achieved. Data on WoB shows an almost similar number in the case of “yes” and “no”, meaning there is a similar number of benefits at the same time barriers for encouraging participation of WE in the tendering process in public procurement.

Masud Akhter Khan, Director (Joint Secretary), CPTU, in his speech, informed that as the leading authority of dealing the public procurement issue in Bangladesh, CPTU has been working very closely with World Bank and ITC to increase the capacity of WoB. He stressed taking the initiative to define ‘women-owned businesses”, and the Ministry of Commerce, as well as the Ministry of Women and Children Affairs, may take the initiative in that respect. Besides, global best practices need to be analysed while preparing the roadmap and policy in the context of Bangladesh. Moreover, he noticed that procurement is a complex and comprehensive issue. Prior to engaging in that system, WoB needs to upgrade themselves with proper technical knowledge. He welcomed women entrepreneurs (WEs) to come to CPTU so that CPTU can train them to be more competitive in the overall public procurement system.

Ferdaus Ara Begum, CEO, BUILD, made a presentation in that respect highlighting the findings of the survey conducted during Jan-Feb ’21 for getting Gender-Specific information on public procurement. Women entrepreneurs are not aware of the prevailing scopes for them in the public procurement domain. She presented country comparison among Nigeria, Chile, Gambia, and Bangladesh to have the scenario of public procurement.

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The 3rd Sustainability and Green Growth Working Committee (SGGWC) took place on 9 March 2021 virtually to discuss different tools and Policies for Extended Producers Responsibilities (EPR) for the plastic sector. The meeting was presided over by Ziaul Hasan ndc, Secretary of Ministry of Environment, Forest and Climate Change (MoEFCC), Government of Bangladesh, while Wasim Zakariah, Chairman of Standing Committee on Research & Development, BGMEA was present.

The Ministry of Environment, Forests and Climate Change (MoEFCC) will work closely with BUILD as well as other relevant stakeholders to ensure an effective policy on Extended Producer Responsibility for the plastic sector, said the Environment Secretary.

He added that we would form two new sub-committees on recycling and green growth under the existing Sustainability and Green Growth Working Committee (SGGWC). The two new platforms should hold regular discussions and deliberations on critical issues on sustainable development in the private sector.

We are seriously concerned over the issue of pollution control; in that respect, in 2018, there was an SRO on EPR, but it could not play a proper role, he said.
At the beginning of the meeting, BUILD CEO Ferdaus Ara Begum updated the meeting with the progress achieved in the implementation of decisions of the Sustainability and Green Growth Working Committee. She mentioned that the Bangladesh Bank had revised the provisions and design of the Green Transformation Fund to make it more accessible for all manufacturers-exporters for importing environment-friendly machinery. The Bangladesh Road Transport Authority (BRTA) has issued an SRO to get the battery-run electric vehicles registered.

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BUILD Chairperson Abul Kasem Khan said that in addition to recycling and managing waste, we also need to promote green growth through diversification and broader adoption of environment-friendly models and solutions such as jute-based pulp, bamboo-based fibre, bio-fuel from waste, and so on. Citing the example of neighbouring countries that are coming up with innovative and sustainable business solutions, he underscored the importance of close and regular cooperation among the public and private sector through the SGGWC and its two proposed sub-committees.

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To disseminate and reemphasise the core health safety guidelines to prevent further spread of the disease and maintain trade and business activities of the economy following the impact of the COVID-19 pandemic, Business Initiative Leading Development (BUILD) and International Finance Corporation organised a virtual workshop on Workplace Health Safety for Business Continuity with Inland Container Depot (ICD) during COVID-19 on 7 March 2021.

This initiative is supported by Bangladesh Investment Climate Fund II, which is implemented by the International Finance Corporation (IFC), World Bank Group and funded by the Foreign, Commonwealth & Development Office (FCDO). The workshop’s objectives were to sensitise concerned service providers and service takers to maintain health safety measures to run businesses even in the post-COVID stage to mitigate export losses.

In the beginning, Ferdaus Ara Begum, CEO, BUILD, welcomed the participants and informed them that Inland Container Depot (ICD) contributed a lot to attaining revenue collection, which is continuously increasing, and the documentation processing time has also been reduced further. She reiterated that Bangladesh had been qualified as a developing country by the UN, which has enhanced the country’s image while posing new challenges. In the coming days, we will have to run our businesses, maintaining our health safety issues.

Saiyab Amal Ahmed, Consultant, International Finance Corporation (IFC), presented the keynote and explained how IFC works closely with NBR in regard to preparing policies, health safety guidelines and implementation of favourable trade policies. In this respect, he referred to the salient points of the WBG global guidance notes and acknowledged the role of NBR, ICD greatly.

Mr Nazmul Hoque, Additional Commissioner, Dhaka Custom Inland Container Depot (ICD), appreciated and thanked IFC for supporting them in preparing health safety guidelines to tackle the COVID situation. Because of continuing business while maintaining health safety guidelines during COVID19, revenue collection was almost uninterrupted. They have kept ICD operation open 24/7 days to support business and the private sector.

Enclosed is the press release (in English) for your kind consideration. Please feel free to contact us for any queries.

Business Initiative Leading Development (BUILD) Chairperson Abul Kasem Khan called on Paban Chowdhury, Executive Chairman of Bangladesh Economic Zone Authority (BEZA), on 2 March 2021 at his office to discuss more private sector-friendly policies and joint research for further success in BEZA.

BEZA Executive Chairman informed that BEZA has already received more than USD 20 billion of investment and it is going reach USD 30 billion soon. Terming Mirersarai EZ as a game-changer, he shared that land allocation is almost exhausted in this Zone. Considering the potential, the Zone areas can be increased further, encompassing Companigong, Sitakunda, Sandip, Hatia and so on.

He put emphasis on the macro-level policy reforms and strong governance for the successful completion of the targeted EZs in Bangladesh.

He further suggested that BUILD should come up with comprehensive proposals with facilitation of trade and investment, attracting more FDI, supporting SMEs, spillover over impact in society in the SEZs etc.

Mentioning the success of SEZs in different countries, Abul Kasem Khan added that each SEZ could become a new economic growth centre for the country. He added that BUILD is thinking of preparing a concept called SEZ – the New Economic Frontier.

He said that SEZs ultimately work towards not only creating jobs within the SEZ but outside as well in addition to generating various spillover economic opportunities, thereby effectively working as economic cities. Therefore, SEZs should share in the additional revenue generated from various taxes collected from economic activities created in that area due to the SEZs operations. This sort of support in terms of a revenue-sharing model and approach can be developed that will thus bring sustainability to SEZs to a great extent. Each SEZ is an economic frontier for the government to nourish and an economical city to be developed.

BUILD CEO Ferdaus Ara Begum said that the policy gaps in handling private and public EZs and other country-specific EZs would need to be minimized. She added that BUILD would come up with a research study on the New Economic Frontier to consolidate the idea and seek support from the government for policy reforms in attracting more private sector investment.

Enclosed are the press releases (in English and Bangla) for your kind consideration. Please feel free to contact us for any queries.

To ensure business continuity following the impact of the COVID-19 pandemic, BUILD and IFC organized a virtual workshop on Health Safety Guidelines for Business Continuity and Trade Facilitation during COVID-19 for Dhaka Custom House on 28 February 2021. This initiative is supported by Bangladesh Investment Climate Fund II, which is implemented by the International Finance Corporation (IFC), World Bank Group and funded by the Foreign, Commonwealth & Development Office (FCDO). The workshop’s objectives were to sensitize concerned service providers and service takers to maintain health safety measures to run businesses even in the post-COVID stage to mitigate export losses.

Muhammed Mahbubur Rahman, Additional Commissioner, Custom House, Dhaka, highlighted steps taken by the Dhaka Customs to smooth and effectively implement their daily tasks while maintaining health safety protocol.

The Custom House clears 3,000-4,000 bill of ladings (B/L) every day while minimizing risks and ensuring quality so that COVID exemptions are not abused. He stated that in order to maintain export and import growth as well as manage the supply chain, they worked hard so that revenue collection does not fall. Because of their sincerity, import growth has remained steady.

In the beginning, Ferdaus Ara Begum, CEO, BUILD welcomed the participants and mentioned that the likely losses of export earnings annually for the country could be about USD 7 billion after the LDC graduation by 2026. We need to be prepared for that and start working in a coordinated manner to stave off the potential negative impact.

She also referred that the revenue collection in different heads such as supplementary duty, export and VAT at the domestic stage has been reduced in the month of December 2020 compared to those in the corresponding month of 2019. The worst sufferers are the small entrepreneurs, while there was a decline in turnover tax of 31% in the corresponding period as mentioned above. She added that we need to apply the double speed strategy to overcome the challenges at the COVID recovery stage.

Nusrat Nahid, Private Sector Specialist, International Finance Corporation, made a presentation highlighting health safety issues and informed about the impacts of the COVID-19 in trade. She stressed the need to maintain different health and safety guidelines even after the roll-out of the vaccines.

Enclosed is the press release (in English) for your kind consideration. Please feel free to contact us for any queries.