Bangladesh is slowly coming out of obscurity. It is now growing in popularity among investors who seek Southeast Asian fortunes. The status of Bangladesh as an emerging country on a strong growth trajectory was recently cemented during the recent OpEd, a large scale investors’ summit, which was a first to take place in the country.
Prime Minister of Bangladesh, Ms. Sheikh Hasina, emphatically announced:
“They have gathered at a place that is seeking to develop itself into a land of investment; a land that can provide rich manpower.”
Some of the biggest multinational companies in the world like Unilever and Standard Chartered were represented at the summit. Many were proud to announce that almost all of their employees are now Bangladeshi. When big businesses come to town, they need to keep costs down, that is, of course, their main strategic reason for relocating in the first place. In Bangladesh, with its young, educated workforce of over 60 million, there is a pool of talent ready to occupy positions.
Of course, this might be a defining cost consideration for European countries and Japan, but what about neighboring Asian countries looking to reduce their cost base? China and Vietnam are more interested in infrastructure projects. Large scale inter-country projects are ongoing. Cynical analysts will question their motivations for improving the infrastructure, which will eventually be of great benefit for transit routes between nations in the region. Having said that, the key to attracting further investment is laying the infrastructural foundations, so Bangladesh will modernize quickly and consequently become more appealing to further investors.
Geographically blessed, Bangladesh has both land and river connections between China and India, two economic powerhouses. Both members of the BRIC nations (Brazil, Russia, India, China) seen by analysts as being on the verge of becoming top tier economies. Lately though, China has had a setback, their economy is flagging, but this is surely only a blip. Bangladesh can also benefit from linking up with the silk route from China to Europe.
Challenges ahead
It is of course not all plain sailing on the horizon for Bangladesh. The country is still undeveloped, with traffic jams and poor telecommunications. Internet penetration stands at just 30 percent. While that offers significant untapped growth potential, it also means a corporation expecting everything to move quickly and smoothly at the start, would be naive. The benefits will be reaped by multinationals who are in it for the long run. Bangladesh is on the verge, and those businesses willing to take a risk will get first mover advantage.
