Exporters upbeat about loss recovery

Exporters are optimistic that the new interim government, led by Prof Muhammad Yunus, will boost buyers’ confidence and increase orders due to the Nobel laureate’s positive reputation in the West, a key market for Bangladesh’s exports.

They believe if the government can restore law and order and ensure safety and security, they can recover the losses incurred during the past month’s disruptions caused by a massive student movement that ultimately led to Sheikh Hasina’s ouster after nearly 16 years in power.

Bangladesh has a good chance of attracting fresh investments into the country, they said, mentioning that buyers are already expressing their eagerness to increase sourcing from Bangladesh.

However, they urged the new government to restore law and order across the country to make it stable and ensure a business-friendly environment to cash these potential opportunities.

In discussions with The Business Standard on Friday, industry owners highlighted some challenges that could be quickly addressed, such as restoring safety and security on highways and speeding up port activities and customs procedures for exports and imports. 

A joint task force led by military officials has already been deployed in industrial zones to ensure safety, according to the Bangladesh Garment Manufacturers and Exporters Association.

Apparel exporters are hopeful that the port will soon resume full container handling capacity following the task force’s intervention. However, operations at Chattogram port and customs remain disrupted, with most customs officials, port staff, and C&F agents absent from their offices.

Decouple business from politics

Country manager for a leading European brand told TBS that confidence in the leadership of Prof Yunus could lead to improved law and order, as well as stronger protections for human rights and freedom of speech. 

Referring to discussions with top officials at his global office, the manager said a business-friendly administration would likely attract more global buyers and increase business from Western nations.

Besides, the official noted that Prof Yunus’ positive reputation in the West could bring in substantial foreign direct investment (FDI), though he presumed that “some neighbouring countries might be concerned about the West’s confidence in the new government.”

“The newly formed interim government must reassure Indian investors with stakes in Bangladesh, making it clear that, under the new administration, business will remain separate from politics,” he added.

An Indian multinational’s country manager said buyers are pleased with the political changes. He also said several European brands are eager to rely more on Bangladesh instead of China. 

Immediate restoration of safety and security is crucial, he added.

MA Jabbar, managing director of DBL Group, told TBS that the new government leader’s strong ties with the EU and the US will boost confidence and business. 

He added that this goodwill could improve the country’s recently downgraded rating. He also warned that the government must be aware of opportunists who would create a chaotic environment.

Situation getting stable 

Sparrow Group Managing Director Shovon Islam said most factories reopened on Friday, a usual weekend for the industry, to make up for production losses from last month’s disruptions caused by the student movement. 

He noted that a joint task force, led by military officials, has been deployed across major industrial zones to ensure safety and security. Shovon added that the industrial police, RAB, BGMEA, and other officials will collaborate with this task force.

Shasha Denims Managing Director Shams Mahmud said industrial zone security is nearly stable, and port operations are running smoothly with shipments on track. He said there is a need for greater cooperation from customs to clear the backlog and meet deadlines. 

He also suggested that the government should resume cooperation agreement negotiations with the EU. Besides, he urged the new government to “publish a white paper on the banking sector” to clarify the country’s economic position ahead of LDC graduation.

If the economic figures from the previous government are proven inaccurate, the new government should postpone the LDC graduation discussions for up to 10 years, he added.

TAD Group Managing Director Ashikur Rahman Tuhin said Bangladesh has already regained its image with the introduction of the new interim government.

“Now, the focus should be on short- and long-term plans to restore law and order, ensure safety, and address the power crisis,” he added.

Ashikur also noted that industries need bank cooperation to pay workers for last month, as payments were due in the first week of this month. 

“Due to the cash crisis in banks, payments might be delayed until 15 August,” he added.