Mahfuz Emran: In the last fiscal year 2022-23, Bangladesh exported goods worth more than $55 billion to the world market. This information was mentioned in the statistics published by the Export Promotion Bureau (EPB) last August. However, yesterday, Bangladesh Bank released the updated statistical report titled ‘Annual Export Receipt of Goods and Services 2022-23’. It shows the amount of money received in the banking channel for the export of goods in the last fiscal year was about$43 billion. According to that, the information of BB, the export earnings are$12 billion less than EPB. According to this, the difference between EPB and central bank statistics is 21.57 percent.
Experts believe that the discrepancy or difference in the statistics of the two organizations of the government regarding the data of national export income is not desirable in any way.
They say that it is important to eliminate the differences because of the needs of individuals and institutions starting from national accounting. Besides, it has special importance for ensuring good governance in trade. Because the practice of over and under invoicing is globally recognized as money laundering under the guise of trade.
The reflection of such practices in Bangladesh is also proven through government agencies. Moreover, in order to secure the future of the current dollar crisis and foreign exchange reserves, statistical differences in government agencies need to be removed.
In this regard, the former chairman of NBR, Mohammad Abdul Majid said Daily Industry, “Those who are doing business are keeping money outside the country through over-under invoices.” Bangladesh Bank has enough ways to identify them, but they don’t. It is said that there has been an increase in exports. But it actually comes at a price. However, it is necessary to see how many products are exported. The difference raises the question of the acceptability or trustworthiness of the account and its correctness.’
Central bankers also agree on this. They say that the issue of which source of statistics should be called export earnings needs to be addressed. And for this it is important to determine the definition of export related data. It also has an urgency to identify and stop illegal trade practices. The Ministry of Commerce formed a technical committee last August to look into the matter.
Bangladesh Bank Spokesperson and Executive Director Md. Mejbaul Haque told, “Our progress realization is real. There is no gap in between. But when the order comes it is treated as an export order. It is being worked on which one would be best to do. Our data definitions will come.
Majbaul Haque commented that there should be no difference in the data, but there will be a gap in the data definition. The spokesperson of Bangladesh Bank said, ‘When I receive the export order, there is a value. Another value when I’m doing the actual shipping. Either under shipment or over shipment or exact amount. There is no control here. It must be accepted. If you want to do business, sometimes send less, sometimes more. Again, when the progress is realized, another event happens. Many times, discount is taken, many times the buyer is not found. All of them have a real factor.
Responding to the question whether there is any illegal flow of money between the export of goods and the difference in the amount received, Majbaul Haque said, “No comment can be made on this without a detailed examination.” Matters will be clarified when the committee reports. These are the places we are trying to find. If the committee works properly and gives a good report, then the real reason why there is such a huge gap can be identified. As long as the payment for the export is not received, the liability of the exporter remains. There are some realities like we lost many millions of dollars because many companies were not found. If you want to do business, you have to accept this reality. The reason for the big difference has to be found.
The concerned officials of the central bank are claiming that there are some logical reasons in the statistics of EPB and Bangladesh Bank. According to them, exports from the country’s Export Processing Zone (EPZ) are within the country or inland. As a result, it is multiple times or double counting. However, the central bank does not do double counting. Returned goods are also re-exported. Again, the equipment of Padma Bridge has been re-exported. In this case, the value that is held by the central bank is excluded. They have no proceeds, only exports. Then there are some short shipments, as well as non-payments. All this is being worked on to bring the volume of repatriated goods closer to shipping and export.
According to the Ministry of Commerce, the related committee has identified several reasons for the difference in export statistics. Even if the actual reasons are excluded, if it is seen that the difference remains, the exporters are not bringing money, then there is room to think differently. In this regard, Tapan Kanti Ghosh, senior secretary of the Ministry of Commerce told, “The committee is verifying the data. Some primary causes have also been identified. I have given instructions for further investigation. It will take some more time to prepare the full report. Long-term statistical analysis is also necessary to identify the real cause. Whether due to timing differences or for any other reason, the export earnings have to catch up with what is coming in.’
It is learned that EPB mainly prepares the export information based on the bill of export issued by the custom houses. On the other hand, Bangladesh Bank prepares the Bill of Lading. If a bill of export is later canceled by customs, that information is adjusted in Bangladesh Bank’s system. But this information is not with EPB. Besides, the central bank considers only the amount of value addition as exports in case of exports on CMT (Cutting, Making and Trimming) basis. On the other hand, EPB considers the full money value (invoice value). Despite this, the stakeholders do not see such a big gap in the export data as normal.
According to the data kept with Bangladesh Bank, if the full value of CMT exports is calculated, the export amount will increase by $1100 million in the fiscal year 2022-23. Besides, bill of export worth $30 million has been canceled. Usually, its amount is around $50 million. Besides, the bill of export has been issued but the banks have not yet given the information about the bill of lading, the potential export value is $745 million. In the overall review, there is an opportunity to export products of maximum $4.8 billion in the banking channel in the financial year 2022-23.
Garment exporters, the country’s largest foreign exchange earner, say the discrepancy in data is not clear to them. A comparative analysis of the purchase order situation does not match the government statistics. Many of the exporters themselves are raising questions about the statistics provided by the government. But cannot be challenged. Because exporters have no statistics of their own. There is also no mechanism of its own to verify the actual quantity of exports.
According to garment exporters, unfair trade practices may also account for the discrepancy in figures. International trade is an important area of money laundering in Bangladesh as in many other parts of the world. There are many complaints of not bringing money to the country by exporting products. There is little opportunity for such incidents to escape the attention of Bangladesh Bank. Despite this, there are opportunities for this to happen. That is why the monitoring system of the bank needs to be strengthened. Whatever the reason, statistical differences need to be investigated.
Executive President of Bangladesh Knitwear Exporters and Manufacturers Association (BKMEA) Mohammad Hatem told, “Export revenue should be captured from the money that comes from exports. As such, Bangladesh Bank’s information is the actual export income. It is not unusual that the difference between the figures of EPB and Bangladesh Bank will increase, because as exports increase, the difference will also increase. There are two reasons why the difference this time is about $12 billion. One is that the difference will increase as exports increase. Besides, in recent times, buyers have been paying for imported goods very late. Due to increase in stock, decrease in sales, they are delaying payment. We will never be able to provide real accounting or accurate accounting until the entire system is automated and access to exporters is ensured. However, we do not agree with EPB’s account of exports. Compared to that, Bangladesh Bank’s statistics are very acceptable.
Incidentally, in the report of the central bank, the information of the money coming against the export of goods has been highlighted in the last three financial years. It shows that more than $3,396 million have come in 2020-21 financial year. Although according to the report of EPB, $3,875 million worth of products were exported in that financial year. As such, the difference in the statistics of EPB and Bangladesh Bank is 12.35 percent or $47.8 billion.
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