Japanese private sector keen to boost investment in BD
FE Online Report |
July 23, 2020, 6:14 p.m.
July 23, 2020 8:02:59 p.m.
More than 200 participants from the Japanese private sector expressed interest in boosting investment in Bangladesh during a webinar on Wednesday.
The online conference titled âDialogue to Boost Japanese Investments in Bangladeshâ was jointly organized by the Prime Minister’s Office, the International Finance Corporation (IFC) and the Japan International Cooperation Agency (JICA).
The benefits and facilities available in Bangladesh have been highlighted by key Japanese policymakers and companies already working in Bangladesh.
Japanese companies Sumitomo Corporation, Marubeni Corporation and Honda have actively participated in the awareness effort.
âThe strength and stability of our economy and our political leadership are unquestionable. We are very grateful to be seen as a destination for more Japanese investment, âsaid MP Salman Fazlur Rahman, the Prime Minister’s investment and private industry advisor, in his opening remarks.
He urged Japanese companies to take advantage of Bangladesh’s high corporate profitability, pro-business policies, massive domestic market, and strategic access to key markets around the world.
His Excellency Japanese Ambassador Ito Naoki, addressing the event, urged Japanese investors to explore the various investment opportunities available in Bangladesh.
BIDA Executive Chairman Md. Sirazul Islam and BEZA Executive Chairman Paban Chowdhury addressed the plenary session and answered questions from Japanese investors.
Zeuna Aziz, Senior Coordinator (SDG Affairs), Prime Minister’s Office, who heads the high-level government committee for the promotion of FDI, graced the ceremony and delivered the closing speech. Hiroshi Jinno, Director of Investments at IFC Tokyo, moderated the event.
Wendy Werner, Country Manager, IFC and HayakawaYuho, Senior Representative, JICA Bangladesh, joined the dialogue and discussed initiatives to support the private sector in Bangladesh.
The webinar followed BIDA’s high-level meeting with His Excellency the Ambassador of Japan, JICA, JETRO and JBCCI in early May, which was facilitated by IFC.
In addition to Japanese companies and major conglomerates, representatives from Japan’s Ministry of Economy, Trade and Industry, Ministry of Finance and Ministry of Foreign Affairs were also present.
Here are the highlights of the dialogue:
A changing landscape
The landscape of Bangladesh will be transformed in a few years with the support of the Japanese government, His Excellency the Ambassador of Japan Ito Naoki told Japanese investors.
He mentioned Japan’s cooperation in the Bay of Bengal Industrial Growth Belt (BIG-B initiative), the Mass Rapid Transit project and the expansion of HazratShahjalal International Airport in Dhaka. âThe Moheshkhali-Matarbari Integrated Infrastructure Development Initiative (MIDI), an energy hub, will be a game-changer for Bangladesh,â he said.
He urged Japanese companies to explore various opportunities in Bangladesh and reiterated Japan’s commitment to the development of Bangladesh in priority sectors such as agriculture, health and human resource development. âThe Japanese government has a menu of cooperation. We will take advantage of it as much as possible. “
A land of profitability
Bangladesh Investment Development Authority (BIDA) Executive Chairman Md. Sirazul Islam highlighted the profitability of the Bangladesh market, as revealed by JETRO’s Asia and Oceania survey during two consecutive years.
âBangladesh currently has more than 300 Japanese companies. In the 2019 survey, 70.3% of Japanese companies are ready to expand in Bangladesh, which remains the highest proportion in Asia and Oceania, âhe said.
The head of BIDA discussed initiatives taken to improve the business climate through Doing Business reforms and the expansion of online one-stop-shop service. âBIDA’s online and interoperable one-stop-shop service already provides 18 electronic payment services from three branches. And will provide another 34 services from 15 government agencies during this year. “Under the leadership of the PMO, we are preparing an attractive package for investors.”
He referred to the government’s measures to simplify the repatriation of dividends and profits. Foreign companies can now access a working capital loan from parent companies. âRight now, we are working to further liberalize the investment regime for foreign companies. “
On Tuesday, announcements were made by the Bangladesh Bank to allow banks and non-bank institutions to extend financial support to foreign companies against foreign guarantees. The registration process has also been simplified through automation.
âOur economic zones give you the infrastructural support you need, on and off site, at very competitive land prices compared to our neighboring countries,â said Paban Chowdhury, executive chairman of the Bangladesh Economic Zones Authority (BEZA). . The 1,000-acre Japanese Exclusive Economic Zone is being developed at AraihazarUpazila of Narayanganj, which is Bangladesh’s very first economic zone under the G2G initiative.
He mentioned the proposed tax and non-tax incentives and highlighted proactive measures such as skills development centers in economic zones of Bangladesh. The total value of expected investments in just three of the economic zones amounts to nearly $ 17 billion. Of these, $ 8 billion will come from foreign investment in the manufacturing sector, âhe said, citing UNCTAD.
“But beyond the incentives, what is also very important is our continued commitment, our service delivery mechanism and the speed with which we respond to issues raised by investors.”
Experiences of Japanese investors
âBangladesh is a strategic priority for Honda,â said Yuichiro Ishii, CEO and General Manager of Bangladesh Honda, which established its factory in 2018. âDespite COVID-19, demand for motorcycles has increased. Both our sales and our share are increasing. Beyond exporting, the potential of the Bangladeshi domestic market is too great to be missed. “
Marubeni Corporation, operating in Bangladesh since the 1950s, spoke about its profitable businesses in textiles, infrastructure and fertilizers. Marubeni Managing Director Hikari Kawai highlighted the effectiveness of joint platforms such as the Japan-Bangladesh Public-Private Economic Dialogue, the Japan Bangladesh Society and the Japan Bangladesh Chamber of Commerce and Industry (JBCCI) .
âThe special attention paid to Japanese investors and the rapid elimination of problems cannot be expressed in numbers,â said Kenta Ono, assistant general manager of Sumitomo Corporation, which is developing Japan’s economic zone in Araihazar. The macroeconomic stability and diligence of the Bangladeshi people cannot be underestimated. He advised potential investors to use BIDA and BEZA as an entry point.
Looking forward to facilitating new projects
The views shared under this initiative are proof of Bangladesh’s readiness as a market, said Zuena Aziz, Senior Coordinator (SDG Affairs), Prime Minister’s Office, in her closing remarks.
âIt was a pleasure to learn more about the experiences of Japanese companies operating in Bangladesh. It is very exciting to listen to potential Japanese investors, whose projects we hope to facilitate. We have taken note of all your suggestions in detail and will respond and resolve any issues promptly.
Strong development partners
There is a particular appreciation for Japanese innovation and technology solutions in Bangladesh, said Wendy Werner, Country Manager, IFC (Bangladesh, Bhutan and Nepal). The ground for investment is also well paved with strong ties based on diplomacy and economic cooperation, she said. IFC will continue to support private sector development in Bangladesh as it is one of the most promising emerging markets in the world.
Bangladesh is not only a gateway to South Asia, but also to Southeast Asia, said Chief Representative of JICA Bangladesh Hayakawa Yuho. âIt is the fastest growing economy in the Asia-Pacific region. âWe have seen Bangladesh’s commitment and this will be the new frontier for Japanese investment.