HE Commerce Secretary recently announced a number of stern measures including closing down or relocating commercial wings of Bangladesh Embassies for failure to meet his Ministry's export targets. This reminded me of my own experience with export targets as an Ambassador. My first tryst with export targets came in Egypt when the Commerce Secretary expressed disappointment in a letter after my Embassy failed to meet the target. That depressed me but not for too long for soon I learnt that the Embassy that topped the list as the most successful Embassy was one in the Middle East that was headed by a non-career Ambassador, a former private college Principal, whose main concern was politics with the Bangladeshi community. In Japan, in the space of a few months, I was once “congratulated” by the Commerce Secretary for surpassing the “target” but “reprimanded “the following quarter when the Embassy fell short. In four years in Japan, I was “congratulated “and “reprimanded” on export targets without realizing why my Embassy “failed” or "succeeded!” The strange fact was that there was really no tangible reason for such failure or success.
I hope readers do not get any wrong impression because the issue is a very serious one for Bangladesh. We either export more or perish. We are just on the wrong track. When I was in Japan, I was very interested to know the reasons behind Thailand's dramatic inroads into the Japanese market. In the 1970s, Thailand's export to Japan was a few hundred million US dollars. By 2002, Thailand was exporting to Japan in just poultry alone, more than US $ 2 billion. The Thai Ambassador in Japan who became a good friend explained the reasons. He said that the dramatic expansion in Thailand's export to Japan was the result of nearly 3 decades of painstaking work of the Thai private sector. Since the early 70s, the Thai private sector had targeted Japan by participating regularly in trade fairs there in the areas where they had potentials. By such participation, the Thai private sector won the confidence of the Japanese private sector in commodities of comparative advantage and expanded its exports that are now worth several billion US dollars. The Thai Foreign Ministry and its Embassy in Japan created the favourable field for its private sector by providing critical market information; negotiating favourable bilateral trade deals through which import restrictions were relaxed/removed; and backed its private sector in a manner that created confidence of the Japanese importers. In actual export, the Thai Embassy or its Government did not come into the scene directly for that was not their business.
The Thai experience is relevant for us to understand that we are on the wrong track. Our export targets are set arbitrarily. The Commerce Ministry does not consult the Embassies in setting targets. Embassies are given figures and a list of commodities without the platform to interface with the actual sellers, the exporters. They are thus “shadow” sellers who never see the goods they are asked to sell. To complicate matters further, they often find items in their list that they alone know would just not sell within the year for a variety of reasons as lists are prepared not just arbitrarily but also without professional market survey. When I was in Japan, pharmaceutical was one item in my mission's list. That was an impossible task for achieving in a year for import requirements for pharmaceuticals into Japan was and still is a very complex issue. Our pharmaceuticals have good prospect in Japan but it would require many years of coordinated efforts of the Embassy, the Foreign Ministry and the Ministry of Commerce to achieve the desired result.
Another questionable aspect about export targets is the importance it places on the officers of the Commercial Wing to achieve it given their background. A Commercial Counselor/First Secretary is chosen from non-BCS (FA) cadres, often a District Commissioner or a Customs/Income Tax officer. To expect such an officer to be able to deliver the export targets in a foreign environment, sometimes where language is a barrier is a fond wish and the weakest link in the entire process of setting export targets. There is also a very serious misperception about how diplomacy and diplomats work.
The most serious flaw, however, is the fact that export targets for Embassies are unrealistic. In a post cold war globalized world, governments are no longer directly involved in international trade. Today it is entirely a private sector matter where governments create the right environment for such trade. Rules and regulations for it are set in forums such as the WTO and bilateral trade negotiators. Governments and diplomatic missions today concentrate all their efforts to get the maximum advantage for their private sector for exporting commodities across national frontiers through such negotiations and with professional market information/assistance which automatically enhances exports.
There is thus a serious disconnect in both policy formulation and its implementation in the way we are trying to increase exports. All governments have export targets but as a part of that country's economic diplomacy. Unfortunately, we have no economic diplomacy except slogans and vague notions. In the 15 years of elected governments, a lot has been said about economic diplomacy. Yet nowhere in government is there a concept paper about what this means to our overall diplomacy. More vague still is the operating mechanism for achieving the goals of our so-called economic diplomacy that are often set arbitrarily and in an ad-hoc manner. The dangers of this are all around but no one takes notice while the country suffers. When BNP came in 2001, the Industries Ministry cancelled two agreements that were signed with China and Japan by the AL Government disregarding the views of the Foreign Ministry and international law! It upset China and Japan and stalled bilateral relations till the projects, DAP 1 and DAP 11, were reactivated a year and a half after cancellation. This is just one example in a long list of serious flaws in the implementing mechanism of a nonexistent policy of economic diplomacy. While posted in Japan, I felt that Japan could be extremely important for Bangladesh as an investment destination, the way it was in the case of the Malaysian economic miracle. As a result of historical problems between Japan and China, hundreds of billions of USD of Japan's investments in China have become unstable in recent years. Many Japanese investors are seriously considering relocating their investments in China in a new destination where Bangladesh can and has figured seriously to the Japanese given our large population, being a bridge between South and Southeast Asia and the prospects of South Asia being a free trade area under SAFTA. I tried my best to impress the government about this prospect by the only means available, addressing letters that interested nobody at home as there was no single authority to take lead in such matters. When Prime Minister Khaleda Zia visited Japan in 2005, her address at an investment seminar was attended by some 250 Japanese businessmen and investors, a few corporate giants among them, but did not lead to anything substantial as she was unable to impress them with any clear vision of what Bangladesh could do to attract Japanese investment. Our oft-repeated cliché that Bangladesh is the best investment destination in our region is a stale one and has no takers. Khaleda Zia failed to take advantage to impress her Japanese audience because her government then had no policy on economic diplomacy. It still does not have one.
No crystal ball is needed to predict that the stern warning of the Commerce Secretary will have no impact; it will merely have a Que Sera Sera outcome. Given the importance of exports for Bangladesh, however, it is imperative that we develop very urgently our so-called economic diplomacy into a detailed and professional one; streamline the mechanism for its implementation; and fit our need to increase exports as part of it. We have a very vibrant private sector today that has turned our exports from almost nothing to a multibillion US dollar industry with very little help of the government. It needs the government and embassies now to make the playing field for international trade favourable for them by protecting their interests in multilateral and bilateral trade negotiations; with in-depth information of the market abroad for access; and helping them establish contacts with business abroad to achieve the success of Thailand. If they are professional in helping the private sector, exports will increase much faster. The need to set targets for Embassies would become totally redundant, as it should. Unfortunately, most Bangladesh Embassies are not assisting the private sector pro-actively, partly due to their shortcomings and partly due to lack of pro-active direction from home. Half of Bangladesh Missions have no website and those that have are not professional websites that would meet our private sector's requirements. Finally, here is a question for the Commerce Secretary. Suppose an Embassy in a developed country failed to meet the so-called targets. Where would he re-locate that mission's commerce wing? Timbuktu? Economic diplomacy, exports included, is a serious matter that does not work by threats and arbitrariness!
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