Bangladesh National Single Window for Trade

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Bangladesh stands on a cross-road with enormous growth potential
For the $250 billion Bangladesh economy, exports are and will continue to be drivers of jobs and growth. With around two million young people entering the job market every year, Bangladesh has to break into new markets with new products to achieve its vision of export-led growth and the creation of new employment opportunities. Bangladesh’s share of manufacturing in the total exports is much higher than other LDCs (90% vs. 21%). But given that a colossal 83 percent of export is generated exclusively from the Ready-Made Garments (RMG), makes it imperative for Bangladesh to not only diversify its export basket but to also to enter new markets with new products, particularly in East and South Asia, tapping into emerging potential and its geographical advantage. Bangladesh, with its export-led growth vision, aims to increase trade-GDP ratio from 42%-50% with exports increasing up to $54 billion by 2020 as compared to the current $32 billion.

Efficiency in Trading Across Borders is the priority for private sector growth and investment
With trade doubling over the last five years, manual and archaic processing of consignments with limited human resources cannot deliver the expected results for growth. Bangladesh scores 34.9 in Distance to Frontier (DTF) for Trading Across Borders (DB, 2018), far below the South Asia regional average of 57.8 and its neighbors like Sri Lanka (70.7), India (56.5), and Pakistan (38.1). Estimates suggest that the modern customs and border clearance procedure can decrease the cost of trading from 14.-17.5% in lower-middle-income countries like Bangladesh. This has a direct impact on the growth of export as one additional day for clearance can reduce export by 1%. Efficiency in trading across the border is also a priority consideration for investors and the private sector.

Customs has made significant progress, but other trade-related agencies must step up
Introduction of the new Customs Act (replacing the Customs Act 1969), will allow for a number of improvements to support more efficient trading. In addition to this, Customs has also taken up a number of modernization initiatives, including risk-based customs control, post-clearance audit, pre-arrival processing, the introduction of the authorized economic operator, advance ruling, customs inquiry point and website amongst others.

But customs modernization alone cannot fetch the expected results in trade facilitation. More than 38 government and private sector agencies, as well as 13 ministries, are related to trade facilitation. Each of these agencies has to work hand in hand with customs to foster faster issuance of certificates, license, and permits and provide efficient clearance of consignments.

National Single Window for Trade will faster clearance and enhance transparency
To improve its international trading performance, Bangladesh has committed to developing, own and operate a National Single Window with support from the World Bank Group under Bangladesh Regional Connectivity Project 1 (BRCP1) with Customs Modernization and NSW Implementation component amounting to $74.1 million. The IFC implemented and DFID funded Bangladesh Investment Climate Fund is providing technical assistance to design and develop technical and functional specifications as well as key policy changes to make the system effective and sustainable.

With implementation of National Single Window for trade in Bangladesh, 319,000 traders (exporters and importers) are expected to be benefitted from reduced time and cost for trade in the fifth year of the operation of the solution. During the same year, the average processing time for import is expected to be reduced to 122 hours and average processing time for export is expected to be reduced to 88 hours.

What is a trade single window?
A Single Window is defined as a facility that allows parties involved in trade and transport to lodge standardized information and documents with a single entry point to fulfill all import, export, and transit-related regulatory requirements. If the information is electronic, then individual data elements should only be submitted once. As per WTO Trade Facilitation Agreement, members shall endeavor to establish a single window enabling traders to submit documentation or data requirements through a single-entry point to relevant agencies. After processing, results will be notified through the single window in a timely manner. This entails that documents and data should be only submitted once and Members should endeavor to use information technology to support a single window.

The Bangladesh National Single Window (BD-NSW), through the introduction of an electronic, online solution, will facilitate faster and more transparent international trade procedures reduce costs and provide consistency and certainty to the total process, from the start of the regulatory requirements to the clearance of goods.   The BD-NSW will deliver a user-friendly, electronic system that streamlines and automates procedures for registered private sector stakeholders and Government Agencies for international trade-related permits, licenses, certificates and customs declarations.

Thirty-eight government and private sector agencies and ministries to be connected with the Single Window for trade
Around 38 government and private sector agencies from 13 ministries will be connected with the National Single Window system. The agencies are signing a Memorandum of Understanding on August 07, 2018. The MoU outlines the general principle of collaboration, roles of different parties, preliminary commitment for business process and policy reform to make National Single Window system for trade effective and sustainable.

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