August 18, 2010

Bangladeshi shrimp industry faces more stumbling blocks

Shrimp industry in Bangladesh is bogged down by government's withdrawal of additional cash incentive this year, even as it continues to face hurdles from EU's imposition of various restrictions citing health hazard.

Industry people said the sector is already going through a crucial time and the government's recent decision is a great setback for the exporters.

The government has withdrawn the extra 2.5% cash support offered to frozen shrimp and fish exporters enjoying loan rescheduling facilities from July, 2010.

Frozen food exporters earlier got a cash incentive of 15% and last year the government offered an additional support of 2.5%.

However, officials said that a new package in the form of block account facility has been introduced for the exporters. But it was later claimed that this block account facility is helpful for the bankers rather than the exporters as they will pay interest at a rate of 8% while the government will pay 3%.

At present the industry is facing a hard time as the EU has made mandatory testing of 20% sample of consignments heading towards European states effective from July 15, according to sources.

As a result, hundreds to Bangladeshi shrimp consignments are now stranded in different ports of the world due to the new EC rules preventing them to enter European states without carrying a certificate declaring the produce is free of oxytetracycline and chlortetracycline bacteria.

The government has sought relaxation of new EU testing requirements for Bangladeshi shrimp containers sent before July 13 this year saying these containers are not accompanied by testing certificates.