Saturday, May 18, 2013

Jumana Rezwan's Canvass




Dwindling export of tea
Tea exports have decreased over the years as rising prices and low production rates have seen international buyers turning to Vietnam and Malaysia as preferable sourcing options.  Once a major foreign currency earner, the tea industry is suffering deeply as deficits in production has resulted in the country importing supplies to match demand.  To revive the industry, the Bangladesh Tea Board is investing in new tea gardens in several locations throughout the country.

While this is good news for the country’s trade, it is also a very critical time for the nation’s workers. With the recent Savar tragedy, there is greater scrutiny of worker rights and workplace safety. The tea industry currently suffers from problems such as shortage of labor and lack of training in tea related issues.  If the tea industry wants to create a sustainable industry, these new expansion plans, still in its early stages offer a good opportunity to ensure that regulations are strictly applied and hazardous practices avoided before the industry expands further. Workers’ welfare must be a key priority, as Bangladesh cannot afford to suffer from accusations of negligence in yet another sector of the export economy.



Green Banking and the New Bangladesh
The banking industry in Bangladesh has taken a step towards sustainable development with the initial implementation of the Bangladesh Bank’s Green Banking guidelines. A fund has been created to help finance business ideas that specially focus on renewable sources of energy or efforts to develop environmental friendly practices. So far the response has been very positive with several banks dedicating significant funds for what is both a socially responsible and profitable cause.

If Bangladesh is to become a middle income country in the near future, this is the right way to go about it. By encouraging environmental friendly practices and offering special concessions to those who abide by them, BB is not only creating awareness but backing it up with financial incentives.  However, to ensure success in the long run, the cooperation of all banks is essential, as they are the main medium though which borrowers have access to funds.  While the initiative is positive, it is perhaps still too highly focused on large scale project loans, whereas the future of the country likely lies with SMEs. Moreover, there seems to be insufficient understanding on exactly what the banks are likely to gain from this initiative other than goodwill. This may hamper the sustainability of the initiative, as the initiative must not only be socially desirable but also profitable. 

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