Around 95 per cent Nordic companies doing business in Bangladesh are contemplating to increase their activities in the country in the coming three-year period, said a recent survey.
Part of the reason for the plans to increase activities in Bangladesh could be that they experience higher profit opportunities here compared to other markets they are currently active.
Other reasons are the growing demand from the middle class as well as increasing costs in other markets where the companies are active such as China, according to a Business Climate Survey among Nordic companies in Bangladesh.
The Nordic Chamber of Commerce and Industry in Bangladesh together with the Sweden Bangladesh Business Council and the three Nordic embassies here — Embassy of Sweden, Royal Norwegian
Embassy and Royal Danish Embassy —conducted the survey.
About 67 per cent respondents consider the business climate in Bangladesh as favourable despite political instability, erratic power supply, poor transport infrastructure, legal barriers and bureaucratic norms that impede growth.
Almost half (47 per cent) of the respondents have a very favourable outlook whereas not one single respondent reports an unfavourable business outlook for the coming three-year period.
The picture that Nordic companies portray when doing business in Bangladesh is not solely positive. Companies report that certain areas need to be looked into by decision makers for Bangladesh in order to remain an attractive business destination.
The survey suggests that telecom and IT/ITES is the biggest sector for Nordic companies in Bangladesh (32 per cent of respondents) while RMG/textiles account for 25 per cent.
Of course in terms of volume/turnover, RMG is most likely the biggest sector but the large number of relatively young IT companies show that the Bangladesh economy is evolving towards more high-tech industries.
About one million jobs are created as a result of Nordic businesses in Bangladesh.
Lack of adequate infrastructure is one of the major problems in Bangladesh.
Some 66 per cent of the respondents identified lack of power supply as a major deterrent while 61 per cent of the respondents identified clean water and proper waste management as one area that needs huge improvement.
The survey also revealed the dissatisfaction among the companies due to scarcity of land and offices for commercial purposes.
In relation to the business confidence survey, NCCI has jointly organised a panel discussion, titled ‘opportunities and challenges in Bangladesh: perspective of Nordic businesses’ with the three Nordic embassies — Embassy of Sweden, Royal Norwegian Embassy and Royal Danish Embassy at a hotel on Tuesday.
Bangladesh Bank governor Atiur Rahman participated as the chief guest in the panel. Swedish ambassador Anneli Lindahl Kenny and John McKenzie, head of SEDF, International Finance Corporation, participated as special guests.
NCCI president Shamim Ul Huq also took part in the panel discussion.
The session was moderated by FutureLeaders Group CEO and former NCCI secretary general Quazi M Ahmed.
The main objectives of the survey were to monitor the business confidence of Nordic companies in Bangladesh, to assess Bangladesh’s future role among the emerging Asian economies, to gather the joint experience and knowledge of Nordic companies in order to facilitate for future establishment of Nordic companies in Bangladesh and to be able to better understand trends in the Bangladeshi business environment as the survey will be repeated yearly.
The survey was sent to a total of 55 companies, of which 46 are NCCI members and 9 non-members.
Out of the 55 invited companies, 37 responded corresponding to a response rate of 74 per cent among members of the NCCI and 33 per cent from non-members.
The survey was conducted from December 1, 2012 to January 15, 2013.
-With New Age input
