Lesson 2: Promote exports

Given Bangladesh's economic characteristics and resource poverty it must receive a substantial boost from exports of manufactures and processed agricultural commodities to attain rapid growth. The importance of exports to East Asian countries is unequivocal. In Taiwan (China), Thailand, the Philippines, and China rural industries have been in the forefront of the export push. The spread effects from this push have been critical for improving rural welfare. Thus, once rural industry has made a strong start, an export orientation can make a vital contribution (Rants and Stewart 1993). China provides an excellent example of the export potential of rural enterprises especially those that have been primed by foreign direct investment. By 1994, there were some 25 million rural manufacturing enterprises, employing over 120 million workers and responsible for a third of rural production as well as nearly half of all manufacturing output. Rural enterprises, primarily the 10,000 that have been the recipients of foreign investment, account for 40% of total exports in 1994. Rural manufacturers active in the export market produce a broad spectrum of products but they dominate the trade in woven textiles, garments, silk products, handicrafts and other light manufactures (Yen Shanping, 1995, Oxford Analytica, August 30, 1995).