The dollar crisis, strict regulation of the Bangladesh Bank and the ongoing civil war in Myanmar hit the Bangladesh-Myanmar bilateral trade in the just concluded 2023-24 fiscal year, causing price rise of some essential commodities in the country, sources said.

According to the Bangladesh Trade and Tariff Commission (BTTC), export and import between Bangladesh and Myanmar are conducted through bank draft instead of traditional letter of credit (LC). 

Commercial banks in Bangladesh impose some strict regulations on doing export and import by opening LC rather than through bank draft against the backdrop of the regulations of the Bangladesh Bank. According to the Bangladesh Trade and Tariff Commission (BTTC) , trade between Bangladesh and Myanmar will increase substantially, provided Bangladesh Bank (BB) eases rules and regulations  on doing export and import through the bank draft.

Meanwhile, Bangladesh currency taka lost value against the US currency dollar in the last two and half years against the backdrop of the Russia-Ukraine war, instability in the global market and sudden drop in the forex reserve. The value of one US dollar against the Bangladesh taka was 85 in 2021 that now stands at nearly 120 taka in 2024.

Sources said Bangladesh Bank in recent times also put some steps on curbing imports against the backdrop of depleting forex reserves of the country.

The total export of Myanmar stood at 77,459.47 tonnes during the July-June period of 2023-24 fiscal year as compared to 2,00,000 tonnes in 2022-23 fiscal year showing over 60 per cent drop....

However, Myanmar exported  only 1006 tonnes of onion and 18,510 tonnes of ginger pushing the price of ginger at record high in the  Bangladesh market, sources said.

Meanwhile, some essential goods like onion, ginger and garlic posted a sharp rise in the local market as Myanmar’s export to Bangladesh dropped in the last fiscal year, sources said.

Prices of some consumer goods are the most competitive in the Myanmar markets compared to prices of commodities in the rest of the Southeast Asian and South Asian markets.

Myanmar exported 88,862 tonnes of onion and 37, 618 tonnes of ginger to Bangladesh in 2021-22 fiscal year. Myanmar export of onion to Bangladesh was zero in the 2022-23 fiscal that held the price of the commodity high during the same correspondent period.

However, Myanmar exported a record 82,804 tonnes of onion to Bangladesh and 585 tonnes of garlic to Bangladesh during the 2022-23 fiscal year. 

The demand of ginger in Bangladesh annually is around 4.5 lakh tonnes with the country producing 1.93 tonnes of ginger. The rest demand is met by importing the commodity from India, Myanmar and China, sources said.

In the past, India often put embargoes on export of some essential commodities like rice, sugar, onion and wheat creating bubble in the Bangladesh market, according  to the Trading Corporation of Bangladesh (TCB), Dhaka Chamber of Commerce and Industry (DCCI), Federation of Bangladesh Chamber of Commerce and Industry (FBCCI), Consumers Association of Bangladesh (CAB) and Directorate of National Consumer Rights Protection.

On December 8, 2023, the Indian government had banned export of onions that also pushed the price of commodities in the Bangladesh market. The Indian government in July 2023 put embargoes on some essential commodities and then lifted embargoes on export of the commodities in April, 2024….

The ban on export of onions was imposed to ensure adequate domestic supply against the backdrop of estimated lower Kharif and Rabi crops in 2023-24 compared to the previous year.

The Indian government April 28, 2024 allowed exports of onions, mainly sourced from Maharashtra, to six countries including the UAE and Bhutan despite the ban on shipments.

The government has “allowed export of 99,150 tonnes of onion to six neighbouring countries of Bangladesh, UAE, Bhutan, Bahrain, Mauritius and Sri Lanka,” the ministry of consumer affairs, food & public distribution said in a statement.

Jasim Uddin Chowdhury, general manager of United Land Port Teknaf Limited that operates Teknaf Land Port, said usually businessmen in Myanmar  send goods through 30-35 cargoes everyday during the beginning of 2024. But the civil war between Myanmar military and rebels in Myanmar and the dollar crisis hit export and import between two neighboring countries .

Bangladesh regularly imports ginger, garlic, and onions from Myanmar via the Teknaf land port. Additionally, a wide range of products such as fish, wood, pickles, spices, coconuts, and electrical goods are also transported to the country through this port.

According to a report from the Bangladesh Trade and Tariff Commission, Bangladesh exports various items, including potatoes, toys, plastic goods, garments, aluminium, medicine, cosmetics, chips, and assorted food items.

However, the export volume remains relatively low. Specifically, exports measured at 0.04 lakh tonnes in FY20, 0.03 lakh tonnes in FY21, and 0.11 lakh tonnes in FY22.

In contrast, imports from Myanmar amounted to 1.98 lakh tonnes in FY20, 0.75 lakh tonnes in FY21, and 2.33 lakh tonnes in FY22 during the same period. Bangladesh exported only 1408.78 tonnes of goods to Myanmar as against import of 77,459.47 tonnes of goods from the neighbouring country.

However, people concerned about trade with Myanmar said the volume of legally imported goods is nearly matched by goods entering Bangladesh through smuggling channels.

Meanwhile, Jasim Uddin Chowdhury said many importers are facing financial losses with trade coming to a standstill. Despite the issuance of many bank drafts, Myanmar traders are unable to export goods due to the country's instability.

He said import-export transactions at this port are not conducted via the Letter of Credit (LC) system, but rather through bank drafts. Due to the closure of banks in Myanmar, bank drafts cannot be processed, leading to a complete halt in imports. However, despite significant risks, Myanmar traders occasionally dispatch one or two trawlers, albeit in minimal quantities. As a result, the government's revenue from the port has also plunged.

The Tariff Commission's report highlights the significant role of cross-border trade between the two countries in ensuring the supply, normalisation, and stability of ginger prices in the domestic market.

Meanwhile, Bangladesh Ambassador to Myanmar Md Monwar Hossain said that Bangladeshi pharmaceutical companies should penetrate deeply into Myanmar as the neighbouring country has emerged as a prospective market.

Md Monwar Hossain was speaking as the chief guest at the seminar titled “Experience sharing in clinical response of Tolperisone, organised by Incepta Pharmaceuticals Limited, a leading pharmaceutical company  of Bangladesh  in Yangon recently .

Myanmar has a very competitive pharmaceutical market compared to other ASEAN countries and the market is attracting a growing number of foreign pharmaceutical companies as it is dominated by imports. Myanmar imports about 80 per cent of pharmaceutical products from other countries.

Bangladeshi pharmaceutical companies are expecting to export pharmaceutical products worth 30 million US dollars to Myanmar this year, and see a strong possibility to increase Bangladesh’s share in Myanmar’s pharmaceutical market.

To make the business grow, pharmaceutical companies should have a mid-term and long term strategy to penetrate into Myanmar market and maintain contacts with stakeholders in the neighboring ASEAN country, Md Monwar Hossain said

“We are encouraging Bangladeshi pharmaceutical companies to do more such events,” he said.

India, Vietnam, Germany, the USA and Pakistan are major suppliers of pharmaceuticals to the Myanmar market, according to available information. In FY 2022-2023, Myanmar imported medicines and related products amounting to US$171.565 million from India, US$53.137 million from China, and US$44.129 million from Thailand, as disclosed by the Ministry of Commerce.

Bangladesh only has a stake of some 5.00 per cent in the Myanmar pharmaceutical market, though the share can be increased to 20 per cent, said a professor while speaking at the seminar.

Senior professors, medical doctors and people working in pharmaceutical distribution and supply chain attended the seminar.

In FY 2022-2023, Myanmar imported medicines and related products amounting to US$171.565 million from India, US$53.137 million from China, and US$44.129 million from Thailand, as disclosed by the Ministry of Commerce.

Hailing from Rajshahi, Md Monwar Hossain obtained his MBBS degree from Chattogram Medical College.

Later, he did his Masters of Science in Health Policy, Planning and Financing from University of London and a PhD in Public Health Communication from Nanyang Technological University in Singapore.

Myanmar imports of pharmaceutical products was US$407.82 million during 2023, according to the United Nations COMTRADE database on international trade.

Bangladesh exported pharmaceutical products worth US$15.89 million during 2023, according to the United Nations.

Another report adds: Bangladesh should explore business potentials with neighbouring  Myanmar despite political tension over repatriation of Rohingya issues, said top business leaders and diplomats.

"The business potentials with neighbouring  Myanmar remain untapped though our business leaders can increase their export 2/3 times within years with some policy-guidelines, "said a FBCCI leader.   

Though Myanmar’s export to Bangladesh posted robust growth in 2022, Bangladesh’s export to the neighboring ASEAN country showed a negative growth during the same period amid political tension between the two countries over the Rohingya issue, sources

Though Bangladesh’s total exports to Myanmar posted some 5.00 per cent negative growth in 2022, Myanmar’s exports to Bangladesh clocked nearly 45 per cent growth.

Myanmar exported goods worth 181,096,000 US dollars to Bangladesh in 2022, 125,322,000 US dollars in 2021, 64,080,000 US dollars in 2020, 66,080,000 US dollars in 2019 and 99,517,000 US dollars in 2018.

Bangladesh exported goods worth 36,891,000 US dollars to Myanmar in 2022, 38,748,000 in 2021, 48,502,000 US dollars in 2020, 31191, 000 US dollars in 2019 and 28,091 US dollars in 2018.

Meanwhile, the  volume of trade between Bangladesh and Myanmar stood at 74,743 tonnes in FY13, 101,815 tonnes in FY14, 77,654 tonnes in FY15, 76,665 tonnes in FY16, 75,359 tonnes in FY17, 162,578 tonnes in FY18 and 109,248 tonnes in FY19.

According to Bangladesh  Trade and Tariff Commission (BTTB),  Bangladesh exported only 0.04 tonnes of goods in 2019-20 fiscal year ,  0.03 tonnes in 2020-21 and 0.11 million tonnes  in 2021-22 fiscal year.

However, Myanmar exported 1.98 million tonnes of goods in 2019-2020, 0.75 million tonnes of goods in 2020-21 fiscal year and 2.33 million tonnes of goods to Bangladesh.

Sources said that trade between two countries suffered during the 2020 pandemic period. But the trade bounced back in 2021.

Myanmar primarily exports dry fish, chilled fish, ginger, onion, burma teak wood, Garjan wood, plum pickle, red chilies and coconut to Bangladesh.

Bangladesh exports fresh potatoes, cement, apparel, textile wastage, soft drinks, biscuits, live eels and fish to Myanmar.                

While talking to this correspondent, a leader of the Federation of Bangladesh Chamber of Commerce and Industry (FBCCI), Bangladesh should explore the Myanmar market extensively as some major consumer goods are available at most competitive prices in the bordering country.

Meanwhile, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) has put emphasis on strengthening the trade relations between Bangladesh and Myanmar through speedily resolving the existing problems in the way of trade.