New policy planned to boost SME participation in exports

The government aims to connect SME entrepreneurs with large exporting companies, creating opportunities for them to enter international markets while helping raise the country’s annual export earnings to $100 billion by 2030. Officials hope the initiative will create new opportunities for SME entrepreneurs to access global markets.

According to Bida sources, Commerce Minister Khandaker Abdul Muktadir, Prime Minister’s Adviser for Economic and Planning Affairs Dr Rashed Al Mahmud Titumir, and Bida Executive Chairman Ashik Chowdhury will be members of the proposed committee.

The policy decision was made at a meeting between Prime Minister Tarique Rahman and private sector entrepreneurs organised by Bida at the Prime Minister’s Office in Tejgaon yesterday (12 August).

Bida Executive Member and Head of Business Development Nahian Rahman Rochi told The Business Standard that a large number of the country’s small and medium entrepreneurs remain outside the export market.

“The government wants to directly connect their products with exports. An initiative will be taken to determine how SME products can reach international markets through coordination with major exporters,” he said.

He said the government would also work to strengthen the capacity of SME entrepreneurs.
“Based on guarantees from the principal exporting companies, the relevant SME firms will be provided with necessary policy support, including tariff benefits, so that they can also access the facilities provided by the government,” he said.

After the committee is formed, meetings will be held with relevant stakeholders to prepare a draft policy. The target is to prepare the draft within the next two months. A meeting between Prime Minister Tarique Rahman and private sector entrepreneurs is expected to take place within another two to three months, where the draft policy will be discussed and finalised.
According to Bida sources, most SME entrepreneurs cannot directly enter export markets because of limitations in capital, technology and capacity, as well as difficulties in accessing finance. As a result, although many SMEs are part of the supply chains of major exporters, they do not receive the full benefits of international markets.

Against this backdrop, the government has decided in principle to bring SMEs into the direct export system based on guarantees from principal exporting companies.

The initiative has been welcomed by the SME Foundation.

Mohammad Jahangir Hossain, general manager of the SME Foundation, told TBS that the government’s initiative to increase exports is positive.

“It will give small entrepreneurs an opportunity to connect directly with foreign importers and potential buyers. Although some SME products are currently exported through large companies, small entrepreneurs do not receive proper recognition or valuation,” he said.

He said the SME Foundation is already implementing an export-readiness programme. Under the programme, 25 entrepreneurs have been selected from around 100 applicants for specialised training. They are receiving hands-on support on the entire export process, entering international markets, connecting with potential buyers and developing market linkages.

The SME sector currently contributes around 30% to Bangladesh’s economy.

According to the SME Foundation, only 9% of CMSME entrepreneurs currently receive direct bank loans, while another 14% access financing through microfinance institutions. The remaining 77% have no access to formal credit.