3 new custom procedure codes on cards to curb export data discrepancy

The government has decided to create three new custom procedure codes to find out the actual export data, avoiding the risk of multiple entries in the export of the same product, through which sample export, CMT (cut, make and trims) export and local export will be calculated separately.

Additionally, to make it easier for the Bangladesh Bank or the respective lien bank to monitor the repatriation of export earnings from abroad, the export number will be considered a mandatory field for the bill of export. In other words, without the inclusion of the export number, the bill of export will not be included in ASYCUDA, a computerized customs management system that covers most foreign trade procedures.

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

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

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

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

“By implementing separate customs procedure codes, it will be possible to obtain a detailed picture of exports across various sectors, as well as the value addition in Bangladesh’s export sector. This will make it easier to obtain GSP+ benefits in the future and facilitate sector- specific decision-making for the government,” he said.

Mahmud added, “The decision to make the export number mandatory for the bill of export, if implemented, will be highly beneficial. It will facilitate the repatriation of export earnings to Bangladesh and ensure transparency for exporters.”

In July, a significant discrepancy was identified in the country’s export earnings. According to Bangladesh Bank’s records, from July 2023 to May 2024, export earnings amounted to $4.073 billion. However, the EPB reported that the export figure for the same period was $51.54 billion.

In other words, there was a $10.81 billion discrepancy between the two government agencies. While the gap did not lead to a financial deficit for the government, it did result in a current account deficit. When the issue sparked widespread concern, the finance ministry formed an inter-ministerial committee tasked with determining a way to release accurate export data within three months. Since then, the EPB has halted the publication of monthly export data.

However, in the “Annual Economic Report on the Functions of Bangladesh Bank (fiscal year 2023-2024)” submitted to the finance ministry this month, the central bank stated that, according to data from the NBR, the export amount from July of last year to May of this year was $44.47 billion. The figure is $7.10 billion less than what was reported by the EPB for the same period.

On 15 July, at a meeting presided over by the then finance minister, Abul Hasan Mahmood Ali, the Bangladesh Bank, the EPB, and the NBR were given three months to identify the root cause of the significant discrepancy in export data. Until the investigation was completed, the EPB was instructed not to publish monthly export earnings data.

The proceedings of the workshop organized by the Finance Division indicated that the discrepancy in export data was initially attributed to two main factors: double or triple counting of the same export in customs house records and the re-export of goods after shipments were canceled by the customs house due to quality issues or other reasons.

Six decisions were taken at the workshop to determine accurate export data. Among these is the decision for the NBR to create three separate customs procedure codes to account for actual export data. One of these codes will exclusively track sample exports.

A separate customs procedure code will be created to account for the export of products where the foreign buyer supplies all types of raw materials, and the exporter only receives wages for sewing or preparing the products.

By implementing separate customs procedure codes, it will be possible to obtain a detailed picture of exports across various sectors, as well as the value addition in Bangladesh’s export sector

Shams Mahmud, managing director of Shasha Denims Ltd

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

The workshop proceedings noted“This will make it easier to obtain information on the quantity, value, and other details of exports categorized by type, and the data on export earnings will also be accurate.”

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

The officials at the workshop decided to establish an acceptable definition of export due to differing opinions on the definition and interpretation of export among various national laws and development partners.

To reduce the risk of errors or discrepancies in export data, the finance ministry has decided to form a cell or committee to verify and validate monthly export data before its publication over the next year.

Recently, after a meeting with the EPB, Finance and Trade Adviser Salehuddin Ahmed told journalists that accurate export data will be reconciled soon. He stated that the discrepancies between the EPB and NBR data will be resolved as quickly as possible. He also instructed the EPB to establish a process for the purpose.

Although official export data up to June has not been published, the EPB has informed the Ministry of Commerce that the total exports for the last fiscal year amounted to $51.07 billion. The amount includes $44.48 billion in goods exports and $6.60 billion in service exports.

The commerce ministry has projected a target of $50 billion for goods exports and $7 billion for service exports for the current fiscal year.