SMEs in Bangladesh

Tuesday, September 12, 2006

SMEs in Bangladesh produce a multitude of labour intensive goods including toys, consumer items, small tools and paper products for the domestic market. Further development of these industries offers various investment opportunities. Export-oriented production in SMEs has gained momentum in the past few years. Entrepreneurs from Hong Kong, Japan and Korea have taken advantage of Bangladesh’s cheap and easily trainable labour and its infrastructure facilities to manufacture products for the export market.
Present Scenario of SMEs in Bangladesh:
Macro-Economic Development: Bangladesh maintained its upward strides in economic growth duly manifested by positive developments of the major macro-economic indicators. The growth of GDP was 6.50 percent for the year 2004/2005. The national savings and investment reached 24.49 and 23.58 percent of GDP respectively in 2003/2004. Per capita GDP and GNI stand at US$ 421 and US$ 444 respectively. The contribution of service sector in the GDP was 50% in 2004/2005. The contributions of industry and agriculture sectors were 28% and 22% respectively.
?In Bangladesh small and medium enterprices (SMEs) have occupied a unique position in our economy with respect to their combined contribution to technological development and poverty alleviation. This sector is also playing a significant role for the development of our economy by creating employment opportunity and producing important alternative machines and machinery parts for saving huge foreign currency for our country. So as a part of our development strategy, we should intensify our efforts to develop this sector to grow industrial base and volume of foreign trade. As we know that in this age of globalization, it is impossible to stop the flow of foreign goods to any country. Only quality products can meet the challenges in global market. For meeting this situation SMEs need to upgrade their technological capabilities and production facilities in order to produce quality products at a competitive price.

Though the SME sector is becoming gradually a rising industrial sector of our country and contributing more and more to our export, this sector faces several problems like- lack of technical know-how, shortage of long-term financial support, lack of skilled workers, marketing link, R & D, knowledge on safety measures, hygiene, environmental pollution, etc. We need to acquire proper institutional knowledge in the fields of technological and managerial education and ask academics and researchers to work more vigorously for the sector’s rapid development.

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Source: Financial Express (link opens in a new window)