Challenges Before Newly Elected FBCCI Leaders

Challenges Before Newly Elected FBCCI Leaders

Md. Joynal Abdin

The Daily Sun on May 15, 2017

The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) is the apex trade organisation of the country. It represents all the Chamber of Commerce and Sectoral Associations in home and abroad. In one sentence we could term it as the focal point of Bangladeshi Private Sector. The General Body (GB) of FBCCI includes representatives from all the district chambers, joint chambers, metropolitan chambers, trade/sectoral associations including the women chambers and associations. No doubt that FBCCI general body is the comprehensive and inclusive forum with proper representations from each of the sectors and sub-sectors of Bangladeshi entrepreneurs. They are the key players of the economy. They are contributing directly in GDP growth, employment generation, export earnings and finally in the poverty alleviation of the country.

The general body of the Federation used to elect the Board of Directors through nomination or direct election. As part of their regular activities the GB of FBCCI elected its leadership for next two years (2017-2019) on 14 May (Sunday). We are waiting to welcome a group of dynamic, forward looking, knowledgeable and effective leaders to lead the federation for next two years. Current election of FBCCI has a significant difference than that of the previous elections. Current transformation trend of the economy (from agriculture dependent economy into industrialized economy), remarkable amount of foreign currency reserve, significant amount of idle money in the banking system, rising number of idle higher educated youth, achievement of our national economic visions, local and foreign investment trend, single product dependency in the export earnings, upcoming national election, concurrent change in the international economic ecology etc. made this election significantly different than that of the previous one. Therefore newly elected FBCCI leaders (Board of Directors) will face a series of built-in challenges in-front of them. The newly elected Board of the federation could consider the following issues in their action plan:

  1. Amicable Settlement with the New VAT and Other Business Related Laws: The government of Bangladesh is planning to implement new VAT law from July 2017. It is one of the widely discussed issues that the new VAT law (Draft) has few inconvenient points for the business community. There are scarcities of in-depth research findings with the issues. Therefore the upcoming leaders could take necessary initiative to measure the inconveniences through methodical research. Foreign best practices could be identified and select a best practice to be replicated here in Bangladesh in this regard. Both the parties the government and the private sector have to be cooperative to reach into an amicable settlement with this new VAT law. The newly elected Board of FBCCI have to consider the issue as first priority to safeguard stakes of the micro, small, medium and new entrepreneurs here in the new VAT law as well as other upcoming business related laws.
  1. Finding out a Way Forward to Utilise the Idle Money of Banking System: We have mentionable amount in the foreign currency reserve along with a significant amount of unutilised funds in the banking system. This unutilised fund has to be invested into productive sector for boosting up the investment wheel. We have unutilised funds but the rate of interest is comparatively higher than that of the competitor countries. So a way forward has to be identified to utilise this idle fund and moving the investment wheel.
  1. Initiative has to be taken to Diversify Product Basket: Bangladesh is the top denim exporter of the world. It is one of the key players in knitwear and readymade garment (RMG) export. What is next? We have potentials in leather goods sector, agro-processing sector, plastic sector, light engineering sector etc. But none of the sectors are coming up with a movement like RMG. Why newer sectors are not becoming export leader or near about RMG? This is because we have limitations in terms of new product designing and development. At the same time we have limitation to maintain international standard of existing products. Therefore new FBCCI leaders could take the issue seriously and establish few product research, design and development centers for potential sectors. They could claim funding from the development partners in this regard.

The government of Bangladesh announced 2017 as Leather Goods Year. But in absence of significant development initiatives (projects and policies) this announcement may not be worthwhile. The newly elected business leaders could take this issue to make the Prime Minister’s announcement meaningful.

  1. Internationalization of Bangladeshi Brands: Bangladesh is still lagging behind to establish an international brand. Walton has started this journey in a limited scale. I think all the major exporters of the country have this ability to establish own outlets abroad and establish Bangladeshi brand image with the world class products. The upcoming business leaders could negotiate with the government to allow outwards investment with few precautionary measures.
  1. Creating and Maintaining a Congenial Trade Regime with the Major & Potential Export Markets: Brexit, US presidential views with NAFTA and sloth movement of implementing WTO agreements etc. issues are giving us a signal of tomorrow’s global trade regimes. Bilateral trade arrangements are becoming faster and fruitful means of international trade regime. Till now we do not have a single effective bilateral trade, service or investment agreement with any global players or our major trade partners. Therefor the new FBCCI leaders could think of the issue seriously and insist the government to sign bilateral trade agreements with our major and potential export destinations to create and maintain a congenial trade regime with them. Otherwise we could be isolated in the international market after a certain period.
  1. Private Sector’s Capacity Building to Achieve SDGs: We are committed to attain the sustainable development goals (SDGs) by 2030. Government is enacting necessary policies and laws to facilitate the SDG achievement. But main game has to be played by the private sector. Almost all the sub-sectors of Bangladeshi private sector have limitation in terms of skills, knowledge and know-how. Fiscal and technical limitations are toughing the goals near about impossible. Therefore the private sector leaders like FBCCI Board has to be proactive to play due role in capacity building of the private sector as per requirement of concerned sectors.
  1. Special Attention has to be given to Employment Generation: Idle brain is a devil’s heaven. Idle young force is the engine of social unrest. Bangladesh has 3 million plus unemployed young forces at this time, another 2.2 million jobseekers are entering into the job market every year. Low or primary educated youth are going abroad as worker but a significant number of (not less than 1 million) higher educated middle class youth are remaining idle. This huge number of non-productive young people could be harmful for the family, society as well as the country. This problem could be more visible as an uncontrollable challenge in near future. Therefore it is the right time to think with the employment generation, facilitating self-employment opportunities like freelancing, entrepreneurship etc. Government alone could not be successful if adequate support is not available from the private sector.

From the above discussion it is clear that the new leadership of the Bangladesh private sector i.e. the Board of Directors of the FBCCI has significant role in employment generation, capacity building of the private sector, fostering the investment movement, creating and maintaining congenial trade regime in home and abroad. Therefore the GB members of FBCCI could think a while to elect learned, capable, farsighted, proactive and dynamic leaders to contribute in nation building movement toward a sustainable economic development of Bangladesh.

Absence of Functional Research Facilities in Bangladeshi Trade-bodies

Absence of Functional Research Facilities in Bangladeshi Trade-bodies

Md. Joynal Abdin

The Daily Sun on May 3, 2017

Bangladesh is considered as one of the potential emerging economic powers around the world. It has a very significant number of achievements in terms of fulfilling MDGs, increase per capita income, GDP growth, and export earnings.

It is one of the N-11, Frontier-5 countries. Bangladesh entered the level of lower middle income country and hopes to progress further. Bangladeshi scientists, innovators and researchers have proved their world class capacity and merits. As a result we are getting name of many Bangladeshi scholars in various prestigious global lists. But till now we hardly have a signboard of Bangladeshi companies out of our territory. Easiest answer of this absence could be that, it is prohibited for Bangladeshi nationals to carry beyond a certain amount of money abroad. Absence of capable entrepreneur could be another cause of it.

Government effort to develop capable entrepreneurs in Bangladesh is very insignificant. We have 122,176 primary schools, 20,297 high schools, 4,113 colleges, 9,319 madrashas, 5,790 technical schools and polytechnic institute and 132 universities in Bangladesh but we do not have a single specialised entrepreneurship development institute. We are producing doctors, engineers, managers, technologists and other professional job seekers through our education system here in Bangladesh. But we are not producing the job provider entrepreneurs through our existing academic curriculum. Globally it is proved that, entrepreneur could be created through proper education, training, mentoring in a congenial policy environment.

There are many challenges/barriers to operate a business enterprise beyond individual capacity. Therefore entrepreneurs became united under a single platform like chamber of commerce or sector specific associations around the world. Similarly Bangladeshi entrepreneurs/businessmen are united under two types of trade bodies namely the chamber of commerce and sectoral associations. There are four different types of chamber of commerce in Bangladesh.

These are district chambers, metropolitan city based chambers, joint chambers and international chamber of commerce. According to a recent list of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) there are 101 chambers of commerce and 379 associations in Bangladesh. The objective of all the trade bodies is capacity building of Bangladeshi private sector from respective fields and negotiating unitedly with the government to create and maintain a congenial business environment in home and abroad. Research based information has no alternative to carry forward this function of the trade-bodies successfully.

Bangladeshi trade bodies including the federation chamber have limitations in terms of research facilities. An effective and functional research centre is absent in all the chambers of commerce including the big players like FBCCI, DCCI and MCCI etc. Scenario is more inferior in the associations including the largest associations like BGMEA, BKMEA etc. Business leaders are providing special commitments for developing the research department of respective trade-bodies before each election during last decade. Another new election of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) is heading toward us in the next month. Hope all of the panels will give emphasis on research and development duly in respective election manifesto. But unfortunately research facilities in the trade bodies are not getting momentum. Let’s think a while why research facilities/capacity of research departments of the trade bodies is not reaching up to the standard of our expectations? The followings could be considered as the major causes of current inferior performance of the research departments in Bangladeshi trade-bodies:

Multiple expectations of the management from the research wing: Job responsibility of the research wing is not clearly defined in the trade bodies. As a result management has multiple expectations from the research team. For example an informative letter has to be written, president or vice president has a program then its requires a written speech, a sector studies has to be conducted, a position paper has to be prepared, trade statistics is required, seminar has to be organised, meeting minutes has to be written, project proposal has to be prepared etc. a long list of expectations to research wing. But writing letter could be completed by the administration or respective department, writing speech could be completed by the PR section, writing project proposal is a specialised job of project consultant etc. are similar tasks but having great distinctions than that of the functions of a professional research team. Thus a good research team could be ineffective if it would like to serve every expectations of the management.

Absence of yearly action plan and budgetary allocation: Most of the major trade bodies of Bangladesh have a research department. But it does not have annual action plan with required budgetary allocation. As a result research executives of the trade bodies became day labourer toward ad hock instructions of the higher authority. Therefore, no publishable research is conducting by them and no output is visible after a certain period.

Writing speeches and other ad hock write ups on an emergency basis: Research department of the trade bodies has to write down speeches for the respective presidents and vice presidents on an emergency basis/within short notice. Writing an informative speech requires time, but short notice decreases its quality. On the other hand giving message of the organization is purely a function of public relations (PR) section. So, PR and Research department has an overlapping position regarding writing speeches. Ad hock write ups like letter, meeting minutes etc. destroyed valuable time of a good research team.

Absence of qualified research team: Conducting research is a team work. It requires cross faculty specialized knowledge of economist, statisticians, MIS and business graduates along with sector specific expertise. But most of the research departments of the trade bodies do not have enough manpower to provide respective faculty inputs in a research team. As a result designing and conducting a quality research is not possible by the fractional team.

Absence of skill development initiatives: Conducting a good research requires a number of technical skills which is not available in all faculty of master level education. Therefore special tailor-made training skills are required to design and conduct a good research. You will hardly find a trade body who is investing money to build capacity of the research team by training them up in home and abroad. As a result research departments are not becoming skilled and proficient in respective tasks.

Absence of competitive package of benefits to retain competitive talents: Most of the trade bodies are paying non-competitive benefit to the executives.

Generally research related professionals are more knowledgeable than that of the others. As a result they have more opportunities than that of the others and switched over into a competitive career option and trade-bodies losses these talented people due to lower benefits packages.

Absence of job security and clear career path in the trade bodies: There is a vulnerability as well as ambiguity regarding the career options of a professional in the trade bodies. As a result these are not lucrative positions at all to the talented university graduates. Therefore, deserving graduates are not willing to apply for a position in a trade body.

From the above discussion it is clear enough that, Bangladeshi trade bodies are yet to determine the job responsibilities of respective research department to make them effective and efficient. Following steps could be considered for establishing a strong research cell in a chamber of commerce or sector specific association:

Determine specific objective of the research wing: Management of a chamber of commerce must determine their expectations from the team. Separate team could be formed for separate actions for example a small team could be specialised in speech, letter, meeting minutes etc. writing jobs. Separate team for designing and conducting professional research on specific issues. Similarly another specialised consultant group is required for project relevant tasks. All these activities are similar but needs different types of skills and mentalities. So a trade body must determine specific objective of its research team or form separate team for separate actions.

Prepare an annual action plan with required budgetary allocation and time frame: The chamber authority has to prepare a specific plan of actions with required budgetary allocation to conduct a specific number of researches on predetermined topics in a year. Ad hock assignment diversified focus of the team and make them weak performer.

Team formation and required capacity building: Conducting Research is a team work. It requires cross faculty knowledge including economist, business graduates, statisticians, development studies and MIS professionals. Therefore, forming a balance team is essential for well performance of a research team. Conducting research in practical fields requires few university plus skills. Therefore even the most scholar university team has to be trained up on specific research relevant skills for ensuring same page thinking of the team. Training has no alternative to make the team well performing.

Competitive package and clear career options: Competitive package is required to retain competitive merits. Job satisfaction, job security and clear career path is required to form and retain a functional and effective research team in a trade body.

Finally; we could state that it is the right time to establish a strong research team at every trade body of Bangladesh. Otherwise capacity building of Bangladeshi private sector will be hampered for another decade until we do so. In many countries chamber of commerce is fully financed by the respective governments. As a result they have skilled professionals in trade bodies. Even the neighbouring Indian trade bodies are well equipped with functional research team. Similarly the private sector of Bangladesh could claim government budgetary allotment for the chamber of commerce. The Federation of Indian Chambers of Commerce and Industry (FICCI) counterpart of the FBCCI has a long list higher educated research team with more professionals than that of the total manpower of FBCCI. A functional research team is much more essential today for capacity building of Bangladeshi Private Sector to negotiate with our global partners and enter into international market with our products either in the form of export or internationalisation of our own brands through outward FDI.