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Index

1. Least Developed Countries,

2. European Union

3. European Union Trade with Bangladesh

4. Jute in Bangladesh

5. History of Jute Traders in Bangladesh

6. Exports of Jute from Bangladesh

7. Measures taken by Bangladesh Govt. to increase exports of Jute to the Global Market

8. Bangladesh Trade report

9. Future of Jute Exports from Bangladesh

10. References

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1. Least Developed Countries

Countries exhibiting lowest indicators of Socio Economic Development with the lowest Human
Development Index are considered as Least Developed Countries (LDC). UN office will decide Least
Developed Countries based on three points of criteria. They are,

I. Gross National Income on a three year average should be under $750 for inclusion and above
$900 for Graduation.

II. Nutrition, Health, Education and Adult literacy are the factors on which Human Asset Index
depends.

III. Economic Vulnerability Index based on indicators like Variation in agricultural production,
Exports of Goods and Services, Non-traditional activities economical importance and
Merchandise Export Concentration.

List of Least Developed Countries

List of Least developed Countries in Africa

Angola, Benin, Burkina Faso, Burundi, Central African Republic, Chad, Comoros, Democratic Republic of
the Congo, Djibouti, Equatorial Guinea, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Lesotho,
Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Niger, Rwanda, Sao Tome and Principe,
Senegal, Sierra Leone, Somalia, Sudan, Togo, Uganda, United Republic of Tanzania and Zambia.

Asia

Afghanistan, Bangladesh, Bhutan, Cambodia, Kiribati, Lao People’s Democratic Republic, Maldives,
Myanmar, Nepal, Samoa, Solomon Islands, Timor-Leste, Tuvalu, Vanuatu and Yemen

Latin America and the Caribbean

Haiti

2. European Union

European Union is formed by a list of European states (27 in number), it is a economic and political
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union. It aims at free and fair trade between its member countries and Least Developed Countries and
also it focus on promoting economic prosperity and creating more jobs to its citizens. European
Commission is its regulating arm for EU.

European Union is formally established in the year 1993; it was formed to support the trade system
between developed countries and developing countries as well as with under developing countries
(Least Developed Countries), which in turn will help these countries to explore the markets in
Developed countries.

List of European Union Countries

Austria, Belgium, Bulgaria, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece,
Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania,
Slovakia, Slovenia, Spain, Sweden and United Kingdom.

3. European Union Trade with Bangladesh

In early 1976 assistance from European Union Community has began, initially it focused on food aid and
later it was expanded to assist Irrigation, Rural settlements and Developmental projects. In the later
stages (early nineties) it has become more beneficial to Bangladesh in terms of getting advantage of
duty free and generally quota-free access to EU market.

Bangladesh largest industries are Readymade Garments and Raw Jute which has thriven virtually in the
competitive EU market with quota free access; however with autonomous decision of granting duty and
quota free access to the European Market to less developed countries by European Commission made
Bangladesh economy to find a new potential market.

4. Jute in Bangladesh

Bangladesh is the major producer and exporter of Jute all over the world, Jute is also called as “Golden
Fiber”. As it is the major producer of Jute, local price of Raw Jute is considered as International Price.
Major portion of the Jute (Approximately 75%) is used as packing material. In these days Jute is being
used for Decoration purposes in cars and automobiles.

5. History of Jute Traders in Bangladesh

Geographically Bangladesh is suitable to grow Jute producing plants, after the separation of Bangladesh
from Pakistan in 1971, Jute trading in not limited to Sub Continent or Asia it also started exporting to
Europe. After Bangladesh listed in Least Developed Countries in 1975, it gained quota free access to the
European market. After the separation of Bangladesh from Pakistan, to have a control over the Jute
industry in the country it established “Bangladesh Jute Mill Corporation (BJMC)”

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6. Exports of Jute from Bangladesh

Improvement in the usage of biodegradable products like Jute and Jute Products in the day-to-day life of
Overseas Customers boosted the exports of Jute Industry in Bangladesh which in-turn generated
revenue to the country.

Export Promotion Bureau (EPB) of Bangladesh, revealed the reports of Jute exports for the year June
2010. These statistics shows that there is drastic increase of 76.43 percent during the period July 2009 to
June 2010, it worth US $ 736.44 million revenue.

Jute yarn and Twine exports registered a growth of 88 percent, compared to same period last year. In
addition, Raw Jute exports grew by 32.46 percent compared to 2008-09($148.17 million) production
with 2009-10($196.27 million) which surged up by 70percent by this Jute export stood second in the list
of products exported by Bangladesh after export of Readymade Garments. Mainly there are three
reasons made this possible, they are

i. There is a considerable growth in privately owned mills

ii. Raw materials had became expensive

iii. Bangladesh Jute Mills Corporation had been reviewed the policies for the establishment of Jute
mills in Bangladesh and in Export Tariffs.

Bangladesh exports Raw Jute to 150 countries approximately; few among them are Belgium, Iran,
Turkey, Iran, Spain, Syria, Uzbekistan, China, India and Pakistan. Increased demand for the jute and its
products made the price of the Jute $1200 per tonne in the global market against $600 per tonne last
year.

7. Measures taken by Bangladesh Govt. to increase exports of Jute to the Global Market

Common Fund for Commodities (CFC) is supporting the implementation of a five year project in
Bangladesh and India, and it was named as “Development and Application of Potentially Important Jute
Geo Textile” to promote Jute Geo textile in the global market costing to US$3.962 million. Bangladesh is
contributing an amount of $0.567 million for the project and the rest is contributed by Indian Counter
parts and CFC.

State owned Bangladesh Jute Mills Corporation (BJMC) is collaborating with few privately owned Jute
mills which are in losses. For instance, “Latif Bawany Mills” exporting Jute to countries in European
Union, Australia and Canada with “Janata Jute Mills” a privately owned Jute Mill.

Bangladesh Govt. is implementing Public-Private ownership through which it is restructuring 27 state


owned jute mills into profitable business in less than one year or so, which are in losses in the present
situation. This situation prevailed due to inefficient management. If we consider the statistics of these
mills they are in losses for the last 10 years which are accounted to Tk 2060 crore, in the last fiscal year
itself they faced a loss of Tk 91 crore. These mills are running shortage of funds in-order to fulfill the
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shortage they are opting banks for huge loans, and they are unable to repay. As of February 2010, the
outstanding loans of jute mills stood at Tk 2467 crore among them Tk 688 crore was in defaults.

Bangladesh Govt. is planning to reopen five, state-owned Jute mills, Quomi Jute Mill and Adamjee Jute
Mill are among them. Quomi Jute Mill, was the largest state owned mill in Northern Bangladesh. It was
established in the year 1960 at Raipr of Sirajganj town, reopening of this mill may generate employment
for almost 5000 people.

State-owned Bangladesh Jute Mill Corporation, started process of reopening one of its largest Jute mill
(Adamjee Jute Mill) in this year and it accounts to Tk 608.72 crore which in turn it can provide
employment to 5720 workers to work on 1000 loom to produce export quality Jute from Raw jute.
Bangladesh government declared Tk 700 crore as a bailout package for closed mills to repay the loans
and to restart there operation.

8. Bangladesh Trade report

GDP by Sector

EU 27 Trades with Bangladesh

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From the above graph we can interpret that there is considerable change of Imports (0.3 Billion Euros)
from Bangladesh to EU, it shows a positive sign of stabilizing the economy of a Least Developed Country
like Bangladesh.

EU 27 Merchandise Trade with Bangladesh by Product (2009)

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From the above two graphs we can interpret, Import of Textiles and Clothing from Bangladesh to
European Countries are comparatively high, this resembles the support given by European Union to
Least Developed Countries like Bangladesh to sustain its economic stability.

9. Future of Jute Exports from Bangladesh

A recent study by International Jute Study Group (IJSG) proved that Jute can also be used with concrete
in construction of roads, which in turn will increase the demand for Jute in the global market.

10. References

1. http://www.userfocus.co.uk/us/eu.html (Autonomous, Accessed 22nd November, 2010)

2. http://www.un.org/special-rep/ohrlls/ldc/ldc%20criteria.htm (Autonomous, Accessed 23th


November, 2010)

3. http://en.wikipedia.org/wiki/Least_Developed_Country (Autonomous, Accessed 23th


November, 2010)

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4. http://www.iioa.org/pdf/15th%20Conf/sikdar_chakraborty.pdf ( Chandrima Sikdar and Debesh
Chakraborty, Paper Submitted for Presented for presentation at the Fifteenth International
Input-Output Conference to be held at the Renmin University in Beijing, China June 27, 2005)
(Accessed November 22, 2010)

5. http://en.wikipedia.org/wiki/Jute_trade (Autonomous, December 2007, Accessed November


24th 2010)

6. http://news.theage.com.au/breaking-news-world/bangladesh-jute-gets-boost-from-plastic-bag-
backlash-20100620-yotg.html (Kamrul Hasan Khan June 20, 2010)

7. http://www.fibre2fashion.com/news/jute-news/newsdetails.aspx?news_id=88956
(Autonomous, July 22, 2010)

8. http://www.worldjute.com/jute_bangladesh/bangladesh_jute_news.html (Autonomous,
Accessed November 23, 2010), Source: thefinancialexpress-bd.com

9. http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113349.pdf (Autonomous,
Accessed November 22, 2010)

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