The World Bank has approved $100 million financing to help Bangladesh diversify exports in labour and skill-intensive industries beyond the garment sector and create more and better jobs.

The Export Competitiveness for Jobs Project will improve competitiveness of existing and potential export-oriented industries such as leather, footwear, plastics and light engineering, where Bangladesh has demonstrated a competitive edge.

The project will help create more than 90,000 jobs in non-garment export sectors, said the Washington-based lender in a statement yesterday.

“Bangladesh is the world's second largest garments exporter after China and it can boost growth by diversifying its exports, and repeat the garment sector success story in other sectors,” said Qimiao Fan, country director of the World Bank for Bangladesh, Bhutan and Nepal.

“The project will help the economy integrate further into the world trading system, and provide better jobs to Bangladeshi youth entering the labour market in the next decade, with a particular focus on improving female labour participation.”

The WB said the project would help firms access international markets and enhance their ability to comply with international standards through awareness building and matching grants.

The project will address the shortage of skills development, especially in industrial training for women, as well as in infrastructure and technology, according to the statement.

“The project will enhance growth and competitiveness of selected sectors that have a demonstrated comparative advantage or that provide essential inputs in export-oriented manufacturing value chains,” said Michael Olavi Engman, team leader for the project.

The scheme will encourage training to improve skills and labour productivity, and thus help generate better-paid jobs. The average wage growth for firms benefitting from the project could rise by an estimated 34 percent by the end of the project.

Although the garment sector constitutes 82 percent of exports, employment growth in the sector has stalled. However, the non-garment manufacturing sectors have been generating about 300,000 new jobs annually since 2010, the WB said.

Light manufacturing sub-sectors, which are labour-intensive and employ women, have expanded employment by 4.3 percent annually since 2010, according to the statement.

“The project will build on this momentum, and help increase the number of firms directly exporting in targeted sectors by about 29 percent.”

The credit from the WB's International Development Association, which provides grants or zero-interest loans, has a 38-year term, including a six-year grace period, and a service charge of 0.75 percent.

The WB has committed nearly $26 billion in grants and interest-free credits to Bangladesh since the country's independence. In recent years, Bangladesh has been the largest recipient of the bank's interest-free credits.