1. Brief development history
The plastics industry in Bangladesh started in the 1960s. Compared with the garment manufacturing and leather industries, the development history is relatively short. With the rapid economic growth of Bangladesh in recent years, the plastics industry has become an important industry. The brief development history of Bangladesh plastic industry is as follows:
1960s: In the initial stage, artificial molds were mainly used to produce toys, bracelets, photo frames and other small products, and plastic parts for the jute industry were also produced;
1970s: Started to use automated machinery to produce plastic pots, plates and other household products;
1980s: Started to use film blowing machines to produce plastic bags and other products.
1990s: Started to produce plastic hangers and other accessories for export garments;
Early 21st century: Started to produce molded plastic chairs, tables, etc. The local area of Bangladesh began to produce pulverizers, extruders and pelletizers for recycling plastic waste.
2. Current status of industry development
(1) Overview of basic industries.
The domestic market of Bangladesh’s plastics industry is about US$950 million, with more than 5,000 production companies, mainly small and medium-sized enterprises, mainly in the periphery of cities such as Dhaka and Chittagong, providing more than 1.2 million direct and indirect jobs. There are more than 2500 types of plastic products, but the overall technical level of the industry is not high. Currently, most household plastics and packaging materials used in Bangladesh have been locally produced. The per capita plastic consumption in Bangladesh is only 5 kg, which is much lower than the global average consumption of 80 kg. From 2005 to 2014, the average annual growth rate of Bangladesh's plastics industry exceeded 18%. A 2012 study report of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) predicted that the output value of Bangladesh's plastics industry could reach US$4 billion in 2020. As a labor-intensive industry, the Bangladesh government has recognized the market development potential of the plastics industry and included it as a priority industry in the "2016 National Industrial Policy" and "2015-2018 Export Policy". According to Bangladesh’s 7th Five-Year Plan, Bangladesh’s plastics industry will further enrich the diversity of export products and provide strong product support for the development of Bangladesh’s textile and light industry.
(2) Industrial import market.
Almost all machinery and equipment in Bangladesh's plastics industry are imported from abroad. Among them, manufacturers of low- and medium-end products mainly import from India, China and Thailand, and manufacturers of high-end products mainly import from Taiwan, Japan, Europe and the United States. The domestic productivity of plastic production molds is only about 10%. In addition, the plastics industry in Bangladesh basically relies on imports and recycling of plastic waste. imported raw materials mainly include polyethylene (PE), polyvinyl chloride (PVC), polypropylene (PP), and polyethylene terephthalate (PET). And polystyrene (PS), accounting for 0.26% of the world's imports of plastic products, ranking 59th in the world. China, Saudi Arabia, Taiwan, South Korea and Thailand are the five major raw material supply markets, accounting for 65.9% of Bangladesh's total plastic raw material imports.
(3) Industrial exports.
Currently, Bangladesh's plastic exports rank 89th in the world, and it has not yet become a major exporter of plastic products. In the 2016-2017 fiscal year, about 300 manufacturers in Bangladesh exported plastic products, with a direct export value of approximately US$117 million, which contributed more than 1% to Bangladesh's GDP. In addition, a large number of indirect plastic products are exported, such as garment accessories, polyester panels, packaging materials, etc. Countries and regions such as Poland, China, India, Belgium, France, Germany, Canada, Spain, Australia, Japan, New Zealand, the Netherlands, Italy, United Arab Emirates, Malaysia and Hong Kong are the main export destinations of Bangladesh’s plastic products. The five major export markets, namely China, the United States, India, Germany and Belgium account for about 73% of Bangladesh's total plastic exports.
(4) Recycling of plastic waste.
The plastic waste recycling industry in Bangladesh is mainly concentrated around the capital Dhaka. There are about 300 companies engaged in waste recycling, more than 25,000 employees, and about 140 tons of plastic waste are processed every day. Plastic waste recycling has developed into an important part of Bangladesh's plastics industry.
3. The main challenges
(1) The quality of plastic products needs to be further improved.
98% of Bangladesh's plastic production enterprises are small and medium-sized enterprises. Most of them use imported modified mechanical equipment and locally produced manual equipment. It is difficult to purchase high-end equipment with high automation and sophisticated craftsmanship with their own funds, resulting in the overall quality of Bangladesh plastic products. Not high, not strong international competitiveness.
(2) The quality standards of plastic products need to be unified.
The lack of quality standards for specific products is also an important factor restricting the development of the plastics industry in Bangladesh. At present, the Bangladesh Standards and Testing Institute (BSTI) takes too long to formulate quality standards for plastic products, and it is difficult to reach an agreement with manufacturers on whether to use the US Food and Drug Administration standard or the International Codex Alimentarius Commission CODEX standard for food-grade plastic product standards . BSTI should unify the relevant plastic product standards as soon as possible, update the 26 types of plastic product standards that have been issued, and formulate more plastic product standards based on the certification standards of Bangladesh and export destination countries to ensure the production of high-quality plastics that meet international standards. Products to improve the international competitiveness of Meng Plastics products.
(3) The management of plastic waste recycling industry needs to be further strengthened.
Bangladesh's infrastructure is relatively backward, and a good waste, wastewater and chemical recycling management system has not yet been established. According to reports, at least 300,000 tons of plastic waste is dumped into rivers and wetlands in Bangladesh every year, posing a serious threat to the ecological environment. Since 2002, the government banned the use of polyethylene bags, and the use of paper bags, cloth bags and jute bags began to increase, but the effect of the ban was not obvious. How to better balance the production of plastic products and the recycling of plastic waste and reduce the damage of plastic waste to the ecology and living environment of Bangladesh is a problem that the Bangladeshi government must properly handle.
(4) The technical level of workers in the plastics industry needs to be further improved.
In recent years, the Bangladeshi government has taken various measures to improve the professional skills of its workers. For example, the Bangladesh Plastics Product Manufacturers and Exporters Association initiated the establishment of the Bangladesh Institute of Plastic Engineering and Technology (BIPET) to improve the technical level of Bangladeshi plastics industry workers through a series of targeted vocational and technical courses. But on the whole, the technical level of Bangladeshi plastics industry workers is not high. The Bangladeshi government should further increase training and at the same time strengthen technical exchanges and capacity building with major plastic producing countries such as China and India to improve the overall technical level of the plastics industry in Bangladesh. .
(5) Policy support needs to be further increased.
In terms of government policy support, Bangladesh's plastics industry lags far behind the garment manufacturing industry. For example, Bangladesh Customs audits the bonded license of plastic manufacturers every year, while it audits the garment manufacturers once every three years. The corporate tax of the plastic industry is the normal rate, that is, 25% for listed companies and 35% for non-listed companies. The enterprise tax for the garment manufacturing industry is 12%; there is basically no export tax rebate for plastic products; the upper limit of the application for the Bangladesh Export Development Fund (EDF) for plastic production enterprises is 1 million US dollars, and the garment manufacturer is 25 million US dollars. In order to further promote the vigorous development of Bangladesh's plastics industry, further policy support from government departments such as the Ministry of Commerce and Industry of Bangladesh will be particularly critical.
