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

1. Experiences on Trade Facilitation Bottlenecks Sub: South Asia Subregional Economic Cooperation (SASEC) Trade Facilitation Week, Thailand Venue: InterContinental Bangkok Hotel, Thailand Date: March 25-28, 2013 Md. Sabur Khan President Dhaka Chamber of Commerce & Industry

2. Snapshots • Introduction of DCCI • Bangladesh Economy –at a glance • Introduction of SASEC • Benefits of Trade Facilitation • Trade Facilitation Bottlenecks-Experiences • Trade Facilitation initiatives in Bangladesh • DCCI-the lead private sector’s initiatives for TF • DCCI Customs House Automation-a Case • Way Forward

3. 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

4. Present Status of Bangladesh Economy

5. Present Status of Bangladesh Economy (2011-12) • 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

6. 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

7. TradeFacilitation 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.

8. BenefitsofTradeFacilitation • 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

9. Trade Facilitation Bottlenecks

10. 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.

11. Trade Discouraging NTBs faced by Business • Processing or clearance delays at borders or ports • Lack of transit and transport agreement • Compliance with sanitary and phyto-sanitary (SPS) standards • Technical barriers to trade (TBT) • Weak logistics systems • Poor infrastructure • High administrative fees, storage and handling costs • Limited IT usage • Lack of accreditation facilities • Excessive documentation • Lack of cooperation and coordination among trade supporting organizations

12. 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 

13. Trade Facilitation Bottlenecks.. • Limited information about overseas markets and marketing consumers goods • Additional market entry barriers • Lack of attention behind and between borders • Absence of comprehensive Aid for Trade Agenda • Barriers to the international markets of goods and procedures at and around the borders • Skilled human resources and technology • Cost of trading remains high-prevents potential exporters competing in the global and regional markets

14. Trade Facilitation Bottlenecks • Compliant with the TF Measures is almost impossible for an LDC country like Bangladesh • Among 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

15. 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

16. Trade Facilitation Initiatives

17. 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 websites • ASUCUDA ++ is also in place, ASUCUDA World in in process • Chittagong Port is under several reforms.

18. 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.

19. 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

20. Initiatives for TF by DCCI • Dhaka Custom House Automation • Training through DCCI Business Institute • Establishment 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 activities • Issuance of Certificate of Origin (CO) • Policy Advocacy and Reforms • Initiatives through different projects • DCCI Help Desk • Many more....

21. 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.

22. 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

23. The way forward

24. The Way Forward • Harmonization of trade documents • Adoption of the HS nomenclature and use of internationally agreed standard data elements • Online 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.

25. 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

26. Thank You For Your Patience Hearing