FF exporters unhappy with stimulus, demand 20pc incentive
April 27, 2009
Frozen food exporters have demanded a 20 percent cash incentive instead of the 12.5 percent in the government’s newly-announced stimulus package. The Tk 3424 crore package, rolled out Sunday, raised the cash incentive for frozen food exports to 12.5 percent from 10 percent. The Bangladesh Frozen Foods Exporters Association, however, have claimed that the increased incentive was equivalent to just 7.5 percent in practice. BFFEA president Musa Meah told a press conference Wednesday the cash incentive was not calculated on “real export earnings”.
“The government pays on a flat rate of $3.79 per pound of export, but our prices range from $7 to $11 depending on categories,” he said, demanding incentives on real export earnings.
The global recession has led to a fall in demand, especially for shrimp as it is a luxury food item, according to Musa.
“Export earnings (for the industry) were about 10 percent less than the target in the last fiscal,” he said.
Bangladesh’s frozen food exports earned $534 million in FY 2007-08, touching an all time high, according to the Export Promotion Bureau.
But exports from July to February of FY 2008-09 amounted to $331 million, about 11 percent less compared to the same period of the previous year, said the EPB.
Musa said the industry is facing a liquidity crisis of around Tk 400 crore due to losses over the past year and a half.
The crisis has resulted in non-payment to shrimp farmers, which has in turn adversely affected production, added the BFFEA president.
“Already, many of them have switched to growing paddy,” said Musa.
Source: bdnews24
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