Over the past decade, Bangladesh has seen an estimated $6.83 billion illicitly leave the country through trade-related channels. At the current exchange rate of 122 Bangladeshi taka per US dollar, this amounts to more than BDT 833,000 crore. On average, around $683 million is siphoned abroad each year, representing a significant portion of the nation’s foreign trade.
On 26 March, the US-based international organisation Global Financial Integrity (GFI) released a comprehensive report analysing trade-based money laundering in developing Asian countries. Bangladesh featured prominently among the ten Asian nations highlighted for substantial trade-related capital outflows.
Table of Contents
Mechanisms of Trade-Based Money Laundering
The report identifies falsified import-export declarations as the principal method for illicit fund transfers. Companies underreport or overreport the value of goods, allowing large sums to exit the country undetected. Such practices often involve collaboration among business figures, corrupt politicians, financial intermediaries, and bureaucrats, according to both GFI and national reports.
In December 2024, Bangladesh’s interim government white paper committee on economic policy revealed that between 2009 and 2023, during the tenure of the previous Awami League administration, approximately $23,400 crore—equivalent to BDT 28 lakh crore at the period’s exchange rate of 120 BDT/USD—was transferred abroad illegally. This corresponds to roughly BDT 1.8 lakh crore per year.
Annual Trade-Based Outflows
| Country | Decade Outflow (USD Trillion) | Percentage of Annual Trade |
|---|---|---|
| Bangladesh | 6.83 Billion | 16% |
| China | 6.96 | 25% |
| Thailand | 1.18 | 15% approx |
| India | 1.06 | 22% approx |
According to GFI, nearly half of Bangladesh’s trade-based outflow—approximately $3.28 billion—reached developed economies. The report warns that Bangladesh faces a high risk of trade-based money laundering, which hampers economic development, reduces domestic resource mobilisation, diminishes tax revenue, and restricts funding for public services and infrastructure investment.
Global Context
The report notes that larger economies experience higher volumes of illicit financial flows due to the scale of trade. For instance, over the past decade, China’s trade-based illicit flows reached $6.96 trillion, Thailand $1.18 trillion, and India $1.06 trillion, accounting for significant portions of their respective annual trade volumes.
Recommendations
To combat trade-based money laundering, GFI recommends:
- Strengthening customs enforcement and oversight.
- Enhancing information sharing through regional agreements.
- Improving transparency in free trade zones.
- Intensifying international cooperation and compliance measures.
Experts warn that failure to address these trade-based illicit outflows could undermine Bangladesh’s economic stability, weaken governance, and constrain long-term development objectives.