3 new custom procedure codes on cards that reduce discrepancies in export data

The government has decided to create three new customs procedure codes to establish actual export data, thereby avoiding the risk of multiple entries in the export of the same product, whereby sample export, CMT (cutting, making and trimming) export and local export will be calculated separately.

In addition, in order to facilitate the Bangladesh Bank or the relevant pledge bank in monitoring the repatriation of export proceeds from abroad, the export number will be considered as a mandatory field in the export bill. In other words, without including the export number, the export bill will not be included in ASYCUDA, the computerized customs management system that covers most of the foreign trade procedures.

Officials familiar with the matter say that in many cases, goods listed on the duty-paid export bill are not shipped or actually exported for various reasons. As a result, the government will prepare export data only on the basis of shipments that are actually loaded (on board). For this, the general export manifest will have to be automated or prepared online.

The government made the decision at a recent workshop on “Compilation, Maintenance and Processing of Import-Export Data in the ASYCUDA World Database.”

The workshop organised by the Ministry of Finance was attended by officials from the National Board of Revenue (NBR), Bangladesh Bank, Bangladesh Bureau of Statistics, Bangladesh Trade and Tariff Commission and Export Promotion Bureau (EPB).

Shams Mahmud, Managing Director of Shasha Denims Ltd, told TBS that the decisions to ensure accurate export data are very logical.

“By implementing separate customs procedure codes, it will be possible to get a detailed picture of exports in different sectors as well as value addition in Bangladesh’s export sector. This will facilitate the availment of GSP+ benefits in the future and facilitate sectoral decision-making by the government,” he said.

Mahmud added, “The decision to make export number mandatory for export account, if implemented, will be very beneficial. It will facilitate repatriation of export proceeds to Bangladesh and provide transparency for exporters.”

In July, a significant discrepancy was identified in the country’s export earnings. According to Bangladesh Bank data, the export earnings from July 2023 to May 2024 stood at $4.073 billion. However, EPB reported that the export value during the same period stood at $51.54 billion.

In other words, the difference between the two government agencies was $10.81 billion. While this gap did not lead to a fiscal deficit for the government, it did cause a current account deficit. When the issue sparked widespread concern, the finance ministry set up an inter-ministerial committee to determine how to publish accurate export data over a three-month period. Since then, the EPB has suspended the publication of monthly export data.

However, in the “Annual Economic Report on the Functions of Bangladesh Bank (Fiscal Year 2023-24)” submitted to the finance ministry this month, the central bank said the export amount from July last year to May this year was $44.47 billion, according to NBR data. The figure is $7.10 billion lower than the figure reported by EPB for the same period.

On July 15, at a meeting chaired by then finance minister Abul Hasan Mahmood Ali, Bangladesh Bank, EPB and NBR were given three months to find out the reason for the significant discrepancy in export data. Until the investigation was completed, EPB was directed not to publish monthly export earnings data.

The workshop, organised by the Finance Department, revealed that the discrepancies in export data were initially due to two main factors: double or triple counting of the same exports in customs records and re-export of goods after the shipments were cancelled by customs due to quality issues or other reasons.

Six decisions were taken in workshop to establish accurate export data. Among them is the NBR’s decision to create three separate customs procedure codes to capture actual export data. One of these codes will exclusively track sample exports.

A separate customs procedure code will be created for the export of products where the foreign buyer provides all kinds of raw materials and the exporter only receives remuneration for sewing or preparing the products.

By introducing separate customs procedure codes it will be possible to get a detailed picture of exports in different sectors as well as value addition in Bangladesh’s export sector

Shams Mahmud, Managing Director, Shasha Denims Ltd

Additionally, another customs procedure code will be created to track local exports or exports from one EPZ (Export Processing Zone) to another EPZ or within Bangladesh.

Workshop materials excellent“This will make it easier to obtain information on the quantity, value and other details of exports classified by type, and the export revenue data will also be accurate.”

It was also stated that in order to have accurate export data, the export number will be considered as a mandatory field in the case of export bill. In other words, without the export number, the export bill will not be entered into the ASYCUDA system. Providing this will make it easier for the Bangladesh Bank or the relevant mortgage bank to monitor the repatriation of export proceeds from abroad.

Officials attending the workshop agreed to establish an acceptable definition of export due to diverging opinions on the definition and interpretation of export among different national regulations and development partners.

To reduce the risk of errors or discrepancies in export data, the Ministry of Finance has decided to establish a unit or committee tasked with verifying and validating monthly export data prior to its publication next year.

Recently, after a meeting with EPB, Finance and Trade Advisor Salehuddin Ahmed told reporters that the exact export figures would be finalised soon. He said that the discrepancies between EPB and NBR figures would be resolved as soon as possible. He also directed EPB to establish a process for this purpose.

Although official export figures through June have not been released, EPB told the Commerce Ministry that total exports in the last fiscal year were $51.07 billion. This figure includes $44.48 billion in goods exports and $6.60 billion in services exports.

The Commerce Ministry forecasts that in the current fiscal year, exports of goods will reach $50 billion and exports of services – $7 billion.