The Overall Contribution of Economic Development and Industrial Growth Strategy Paper of the Small and Medium Enterprises in Bangladesh

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The Overall Contribution of Economic Development and Industrial Growth Strategy Paper of the Small and Medium Enterprises in Bangladesh

Abstract

In Bangladesh the Small and Medium Enterprises (SMEs) account for about 43 percent of manufacturing value addition, 80 percent of industrial employment, 90 percent of total industrial units, about 25 percent of the total labour force and the make up 75 percent of the domestic economy. The project’s seeks to create an enabling environment that will allow for the sustainable development of SMEs, provision of business development and support services. The SME Policy strategies have been formulated to assist in the achievement of the goals and target the MGDs (2009-15) set by the Government. SME Foundation as a pivotal platform for the delivery of all planning, developmental, financing, awareness-raising, evaluation and advocacy services. The government and the non-government organizations in Bangladesh have initiated various programmes for the SME development in Bangladesh,such as :booster sector implemented by the government and various trade fair arranged by NGOs. There are various constraints that hinder the development of SMEs in Bangladesh, such as lack of modern technology,lack of adequate investments etc.The national economy on the SMEs for generating employment and income especially for the poor in the rural areas, development of entrepreneurship, new business creation and development of intersect oral linkages the SMEs should be declared as a ‘priority sector. This paper is an academic analysis toward policy formulation in respect of SME financing and development.

Keywords: SMEs, Policy strategies, SME Foundation, Government initiatives and NGOs financing, sustainable development

ACRONYMS

BDT Bangladesh Taka
BSTI Bangladesh Standards & Testing Institution BSCIC Bangladesh Small and Cottage Industries Corporation BEPZA Bangladesh Export Processing Zones Authority BGMEA Bangladesh Garments Manufacturers and Exporters Association CCCI Chittagong Chamber of Commerce and Industry DCCI Dhaka Chamber of Commerce and Industry EPZ Export Processing Zone

FDI Foreign Direct Investment
GOB Government of Bangladesh
MOI Ministry Of Industries
MFA Multi Fibre Arrangement
PPTA SME Development and Export Expansion PRSP Poverty Reduction Strategy Paper R&D| Research and Development|
RMG| Readymade Garments|
SCITI Small and Cottage Industries Training Institute SMEF SME Foundation
SOE State-Owned Enterprises
TIN Tax Identification Numbers
VAT Value Added Tax
WTO World trade Organization

Introduction

Many of the growth theories suggest that industrialization is the engine of economic growth. A balanced growth of both agriculture and industrialization is very important and necessary for the economic development of Bangladesh. For pursing the industrial development efforts, the main objectives and strategies focused are optimal utilization of resources, creating employment opportunities and catalyzing the growth of production and exports. The World Business Council for Sustainable Development (WBCSD) showed that in Bangladesh, enterprises of less than 100 employees account for 99 % of firms and 58 % of employment. Well managed and healthy, Small and Medium Enterprises (SMEs) and wealth as well as poverty alleviation. The World Banks “Doing Business” reports indicate that a healthy SME sector corresponds with a reduced level of informal or “black market” activities. Local SMEs can...
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