Professional Documents
Culture Documents
Bangladesh has been lauded for its poverty-reduction efforts and hailed a stabilising force in South Asia
Golden Bengal in pre-industrial days. Its infrastructure was destroyed during the war of independence of 1971. In addition, natural disasters hit developing countries hardest and Bangladesh was recently identified by the Global Climate Risk Index as the country most affected by extreme weather events between 1991 and 2010. Unsurprisingly, the government is tackling global climate change, food security and poverty confidently. In 2005, the poverty rate in Bangladesh was around 40 per cent; by the end of last year it had fallen to 31.5 per cent, putting the governments Poverty Reduction Strategy on a good footing to hit its goal of lifting 12 million people out of poverty by 2015. So what is behind the poverty rate falling by almost a quarter in just five years? In a recent interview with The Washington Post, the Prime Minister attributed it to a combination of factors, saying: We have been trying to find the root causes of poverty and how we could reduce it. We wanted to ensure food security so we put all our force into producing more food and also the distribution system so that food should first reach the poorest of the poor. Then we tried to create job opportunities for them in the rural areas. Now our farmers can open bank accounts with 10 taka [8 pence], a very small amount, and the subsidy we give goes directly to the farmer. So they use this money for cultivation and also it creates job opportunity. We also established one bank to create job opportunities for the younger generation. Without any collateral, they can take out a loan from the bank to start a business. I believe that educating our people will also help to reduce the poverty level. So our education is free up to primary level for everyone, and for girls it is free up to high school level.
BANGLADESH
CLIMATE CHANGE
institutions, for example in the latters role as a major provider of UN peacekeeping forces and in multilateral bodies responsible for climate change negotiations. Prime Minister David Cameron welcomed Bangladeshs Prime Minister Sheikh Hasina on her visit to London in January, commenting: We have a good and strong relationship between Britain and Bangladesh. We have a great shared interest in tackling issues like climate change. In addition, both Britain and Bangladesh have been targets of indiscriminate terrorist violence. During the January visit, both leaders reaffirmed their commitment to continue working together to counter the threat by building up the capacity to pursue terrorists and protect against attack, and also through addressing the root causes of extremism. We have now become an example to the world in terms of disaster management where we have involved the whole community in a disaster management programme. We have also become an example in terms of counter terrorism and counter extremism, says Dr Dipu. In our society there is no room for extremism or terrorism because people do not like it. Even though at some point in our
history some regimes did support these groups, the population rejected it completely. This determination to draw the line at extremism has allowed Bangladesh to become a pluralist society where ethnic and religious harmony is present, not because of any imposed force, but rather from something that has come from within. Dr Dipu says, The influence of Buddhism is where men are carriers of knowledge, but women are carriers of wisdom. The Hindu influence is also there. In Islam the first person to become a martyr was a woman, and in our Prophets life there was a great influence of women around him. There is violence against women in this society, like anywhere, but in our culture there is a special place for women. Dr Dipu is a firm advocate of womens participation in politics. She is one of two master trainers who have trained women political activists under a programme she helped design and implement in close relationship with the National Democratic Institute (NDI) of the US. This is a great country for women and everyone, because if women move forward, then the whole country moves forward, she says. Dr Dipu has also played an important role in many other sectors, including health and human rights, both locally and globally. The Foreign Minister stresses the importance of good international relations. Our main motto with regard to our foreign policy is to be friends with everyone, she says. The US is Bangladeshs biggest trade partner and largest source of foreign direct investment, followed by the UK. It also has growing business, trade and investment relationships with China. Dr Dipu adds: If you look at our infrastructure, a sizeable proportion of it has some kind of Chinese influence. We are definitely looking forward to cooperating in the energy, power and infrastructure sectors, as well as other areas including science and technology, agriculture, research and innovation.
BANGLADESH PRO JECT TE AM: ANDREW MACHAJ, SOPHIA SHEPODD, MAX GAJDEL. REGIONAL DIRECTOR: VINCENT RIFICI. UPPER REACH, 68 King William Street, London EC4N 7DZ, Tel: +44 (0)207 959 2424, Fax: +44 (0)207 959 2201 See it also at facebook.com/worldfolio
BANGLADESH
BRAC now reaches over eight million borrowers, with the number steadily rising due in part to this years launch of bKash Limited, a mobile financial service provider in Bangladesh and a subsidiary of BRAC Bank. Gender equality, respect for the environment and inclusivity cut through all of its activities. BRAC is also an internet service provider, has a university, and its primary schools educate 11 per cent of Bangladeshs children. BRAC also runs feed mills, chicken farms, tea plantations and packaging factories. Although BRAC is now active in 10 countries and spans three continents, the majority of its work remains in Bangladesh. Its low-cost, effective and adaptable solutions to the day-today problems facing poor families can be scaled up quickly to a national level and now reach every village in the country, which covers an area roughly twice the size of Ireland and has a population of more than 158 million people. BRAC has built a massive global network of micro-franchised entrepreneurs providing services in agriculture, poultry, livestock and health. Sir Fazle calls it a holistic, sustainable, market-oriented approach to poverty alleviation that uses microloans, training and branding, while offering borrowers low-cost access to inventory, efficient distribution systems and continuous support. He recently presented his approach to more than 2,000 delegates at the Global Microcredit Summit 2011 in Valladolid, Spain.
BANGLADESH
FINANCE
A
mid the unprecedented global financial crisis Bangladesh has managed to keep its head above water. Bangladesh achieved a GDP growth of 5.74 per cent in the 2008-09 fiscal year and the Medium Term Macroeconomic Framework has envisaged it will only keep growing. An anticipated GDP growth of 6.7 per cent is expected for the 2010-11 fiscal year, with a gradual increase to 7.2 per cent and 7.6 per cent in 2011-12 and 2012-13 respectively. A combination of all of the sectors of Bangladesh are to thank, as reforms and projects are being done in every area to make Bangladeshs potential more obvious to investors. Abul Maal Abdul Muhith, a renowned economist, diplomat, freedom fighter, language veteran, and now currently the Finance Minister of Bangladesh, feels confident that through the multiple projects in various sectors that he oversees, these investments will be achieved. I think the potential here is easy to recognise, and investors will continue to come and invest in Bangladesh. Billions of dollars need to be invested in power, roads, highways, and obviously in railways. So, we are appealing for higher foreign investments and high foreign assistance. So far we are receiving strong responses from investors. They have increased their commitment to the country even though there are a number of problems we continue to work to correct, he says. One sector getting a lot of attention is power and energy. Due to power outages and an overall lack of power in many parts of the country investors have been discouraged. The government has yet to provide gas connections to more than 250 new industrial units and some 5,000 new apartments,
South-East Asia is growing very fast. So, if we can make transit facilities available with these countries I think the economy of Bangladesh will grow rapidly.
which concerns the strategic pillars, where additional capital is required... We have been talking about Basel III as well. ABB continues its efforts to spread its reach to the unbanked population. According to Mr Sattar, currently 9 per cent of our population are bankable, though he is optimistic about future prospects. Soon this figure will be up to 30 per cent.
BANGLADESH
BANGLADESH BANK
CRISL
he borders of Bangladesh as they stand today were established back in 1947 with the Eastern region of Bengal becoming East Pakistan, the eastern part of a new country Pakistan, separated by over 1,600 kilometres of Indian territory from West Pakistan, the Western part. Political exclusion, ethnic and linguistic discrimination, and economic neglect by the politically dominant West Pakistan kept breeding resentment and unrest in East Pakistan, eventually leading to the War of Liberation that ended on December 16, 1971, with surrender of the Pakistani occupation forces to a joint command of Indian Army and Bangladesh liberation forces at Dhaka, the capital of the new Peoples Republic of Bangladesh. Branches of the State Bank of Pakistan in the erstwhile East Pakistan were reconstituted by the government of Bangladesh as Bangladesh Bank, the central bank of the new country. Sheikh Mujibur Rahman, founding father of the new nation, had a socialist agenda; and accordingly the government nationalised all banks in 1972 to ensure channelling of the countrys funding resources to high priority sectors for the reconstruction of the war-ravaged country with the restoration of industry and agriculture. However, the administrations inexperience with state control of various sectors prevented banks from functioning as they should. In the initial years in regime of directed lending at prescribed interest rates the meagrely capitalised nationalised banks kept on handing out loans without commercial consideration driven due diligence. Legal processes for recovery of defaulted loans were hopelessly slow in the nascent judicial system, and non-performing loans kept piling up. While the government in the early years made a point of intervening in all possible areas, proper regulatory and supervisory processes for timely diagnosis and redressing of problems were not in place. As such, in the early years after independence, banking concepts like liquidity and profitability became alien to many financial managers, with capital adequacy and solvency taking backseats. Financial sector reform initiatives taken up in the 1980s brought back private sector bank ownership and lending on commercial considerations; from early 1990s directed lending was abolished, and interest rates were freed up. From then on Bangladesh Bank has been steadily pursuing updating of local financial sector regulatory and supervisory practices structures towards full convergence with international best practice standards, including the Basel Committee riskbased capital standards and liquidity buffers. Dr Atiur Rahman, the incumbent Bangladesh Bank Governor, is keen to point out that despite the teething period problems of the earlier years the Bangladesh
We are much, much cheaper than both China and India in terms of labour costs. We can outbid anybody for many years to come.
DR ATIUR RAHMAN, Governor of Bangladesh Bank
economy has been growing steadily over the years, and is now on firm footing on a path of faster growth over the coming years. He insists that it is this future rather than the past that should be of most interest and relevance for investors. Bangladesh is an untold story, an unearthed secret, waiting to come out to the world. A new, inclusively growing, socially and environmentally responsible Bangladesh is emerging outside the glare of centre stage and beyond the traditional Western vision. This Bangladesh is resilient, innovative, very forward looking and liberal in attitude. Bangladesh Bank has now progressed vastly from the initial shaky
start to presiding over a dynamically growing, robust and stable banking sector, with proactive reforms in regulatory and supervisory standards and the introduction of practices like stress testing. This dynamic financial sector is capably supporting steady output growth in the economy. Our 6.7 per cent FY11 real GDP growth target was attained, and the economy is on course for attaining the 7 per cent growth target for FY12, said Governor Atiur. Exports and imports both grew by more than 40 per cent y-o-y in FY11. The composition of imports was remarkable, with only about one seventh in consumption goods and all the rest in capital goods and production inputs. BBs financial inclusion campaign embraced enthusiastically by banks is promoting credit flows to the productive, income and employment-generating micro, small and medium-scale enterprises throughout Bangladesh, hastening poverty reduction. This is evidenced in the recent substantial rise in rural real wages and in attendant decline in poverty. Governor Atiur sees the growing population of young and willing workers throughout Bangladesh as an important advantage. We are much, much cheaper in labour costs than both China and India; we can outbid other countries on this count for many years to come. Ive heard of a Western automobile manufacturer getting their car interiors designed by teams in Bangladesh. Senior representatives from many leading global IT sector corporates visiting Bangladesh have expressed keen interest in utilising our upcoming crop of young tech-savvy manpower. Foreign investors in the apparels and other light export manufacturing sectors, including those from China, India, Korea and the Gulf region, have bought up or set up manufacturing units in Bangladesh. The electricity and gas shortages impeding these processes are now being addressed which by themselves are investment opportunities for foreign investors. Governor Atiur recognises the important role that foreign investors, particularly the larger multinationals, can play towards faster economic growth in Bangladesh, bringing in global marketing clout besides output technology and investment capital. Recalling the role of capital market development side by side with financial sector development, Governor Atiur points out that except for volatile short-term capital flows in the money and credit market, non-resident owned direct and portfolio investments can enter Bangladesh freely; and post tax profits/dividends and disinvestment proceeds thereon can be freely repatriated abroad in convertible currencies. Further information on these foreign investment facilities in Bangladesh can be accessed from such sources as Bangladesh Bank, Board of Investment and the Bangladesh missions abroad.
redit Rating Information and Services Limited (CRISL) is the first credit rating company in Bangladesh. The company was incorporated with the Registrar of Joint Stock Companies in 1992 and Credit Rating Company rules 1996 as a recognised ECAI, and has been operating as the first rating company in the country since 1995. Initially, all credit risk assessments were done internally by SEC Bangladesh (Security Exchange Commission of Bangladesh), which acts as the regulatory body for external rating institutions. This scenario has been changing slowly as dependency on, and trust of, credit rating agencies grow stronger. The genesis of the CRISL is linked with the Bangladeshi governments efforts to organise the first ever Euromoney Conference in Bangladesh in 1994, where a large number of international investors and world investment forum members were invited, with a view to gaining some insight into the financial stability of the South Asian country. The participants concluded that the reason Bangladesh had not been receiving the desired level of investment was that the country did not have a rating agency, and the country had not been rated officially by any international rating body. In absence of the above, some international rating agencies, based on the limited financial information available at the time, gave Bangladesh a C rating, which meant a highly speculative and risky country for investment. In late 1994, Dr Muzaffar Ahmed, a leading Bangladeshi economist and business professor at the University of Dhaka, took the position of CEO at CRISL, a position which other financial experts had considered carried too much responsibility, for too little reward. Dr Ahmed immediately visited several rating agencies in India to get a better understanding of those companies, their operational methods and their prospects. Upon returning to Bangladesh he discussed the project with a few select professionals and business people, making detailed presentations, ultimately convincing them to join with him, and invest in CRISL. Since its beginnings CRISL has played a major role in reversing the financial mistakes made by the newly independent Bangladeshi government of the 1970s, particularly non-performing loans. Dr Ahmed recently said: The Central Bank instructed all banks to be rated every year in the financial sector, which means all the banks have to submit a credit rating to the Central Bank every year. This has a tremendous impact on the economy, since banks are required to report on their compliance status. As a result, in the last 10 years the number of non-performing loans (NPL) of our banks has substantially decreased.
BANGLADESH
We do not term it as CSR, but rather corporate sustainability (CS) because there is a connotation in CSR of doing charity. Our growth model is more about co-existing in the country and trying to sustain businesses together, explains Sanjay Prakash, CEO of HSBC in Bangladesh. With offices in 87 countries, HSBC is a truly international enterprise, but it has established firm roots in Bangladesh, with local workers comprising 99 per cent of its staff, as Mr Prakash proudly asserts: There are only three expats here out of 1,050 people. CS is very much a part of the companys DNA, and is embedded is in all its credit procedures. Each time we lend money to any corporate body, we make sure that they comply with good practices from a corporate sustainability point of view. We would not fund any project which violates the en-
The second largest corporation in terms of market capitalisation on the stock exchange, ICB offers a wide array of commercial and investment products to global investors Since 1991, Bangladeshs economy has prospered with an average GDP growth of 5 per cent, and the government has set a 7 per cent target for this year. The role of foreign direct investment is not to be underestimated in this growth. In Asia we are one of the three largest countries in terms of foreign remittances. Last year our export sector grew by 44 per cent. FDI in Bangladesh grew by about 30 per cent in 2010 when it only grew by 4.56 per cent globally, explains Mohammad Fayekuzzaman, managing director of the Investment Corporation of Bangladesh (ICB). ICB was created in 1976. The purpose, explains Mr Fayekuzzaman, was to create a capital market. There was no private sector, so ICB had to play a strong role. Today, it is one of the countrys largest investment banks and has evolved with the times. We have reformed ICV and created three
vironment or pollutes rivers, for example, or if we found children working in the factories, he adds. Each year, HSBC Bangladesh contributes to four different areas: education, under-privileged children, climate and environmental issues, and cultural preservation. In all our activities for example, supporting underprivileged children, installing rainwater harvesting systems, promoting Bangladeshs young entrepreneurs at a regional level, tree plantations, art and cultural endeavours our staff play a key role, Sanjay commented. As the leading international bank in the country, HSBC is committed to supporting Bangladeshs international trade, particularly the exporters, he added.
subsidiary companies established to compete within the private sector. As a result, net profits have more than tripled since 2001. The Bangladeshi government has an Equity Entrepreneurship Fund (EEF), now under the responsibility of ICB, which encourages innovation and aims to create new entrepreneurs, giving unemployed people a chance to build their own business, particularly in the IT and agricultural sectors. We provide 49 per cent equity for the sponsors, not through a loan. They are obliged to return it in the fourth year using their profits. If they do not make a profit, they will simply return the amount they received initially, and become a 100 per cent owner of the company. Looking into the future, Mr Fayekuzzaman envisions an alternative market. There should be a new market where these new companies can trade and sell venture capital. Furthermore, ICB has a Unit Fund Scheme that contributes to the industrial development of the country. I invite non-resident Bangladeshis to invest in this fund so they can contribute to the stability of the capital market.
BANGLADESH
FARMING INFRASTRUCTURE
A strong agricultural sector is vital to the nations wellbeing
A
griculture is the single most important sector in Bangladeshs economy today, contributing about 20.24 per cent to GDP in 2009-10. The growth rate of this broad agriculture sector for 2009-10 was estimated to be 4.67 per cent. The highest priority in this country is agriculture, Abul Maal Abdul Muhith stressed, who has been the Finance Minister of Bangladesh since January, 2009. The agriculture sector is so important to Bangladesh not only for the numbers it contributes towards the countrys GDP, but also for what it does for the people of Bangladesh. This sector has given Bangladesh food security, while also making an overwhelming impact on the macroeconomic objectives of poverty alleviation, employment development, and human resources development. As a result, the Bangladeshi government is paying close attention to agriculture and fishing, and doing everything in its power to maintain its upward curve. Against a backdrop of global recession, commodity price hikes and food shortages, measures have been taken to meet the increasing food demand by increasing domestic production. Special emphasis has been given to build up a modern
agricultural system, with the introduction of new technologies and expansion of opportunities for agricultural research. Furthermore, measures for increasing subsidy on inputs to agriculture, expanding irrigation and making agricultural inputs more available, preserving the harvest and ensuring fair price of crops and agro-products have been taken, with the aim of increasing productivity. The target for agricultural credit disbursement in 2009-10 was fixed at Tk. 11,512.30 crore, of which Tk.11,116.88 crore was disbursed, achieving 96.57 per cent of the target. Rice and jute are the countrys primary products, though maize and vegetables are assuming a greater importance. Tea is grown in the northeast, and due to fertile soil and an ample water supply, rice can be harvested up to three times a year. The livestock sector has become increasingly significant, and the government has taken steps such as producing and distributing vaccines, supplying ducklings and chickens at lower prices, expanding artificial insemination programs, and preventing and controlling avian influenza. All the measures contribute to the same goal to achieve self-sufficiency in milk, poultry and livestock production, and to meet the protein demands of a rapidly growing population.
In working towards developing a Digital Bangladesh it is important to understand that we have a young population, the majority of which are under the age of 25.
MEHBOOB CHOWDHURY, CEO of Citycell
BANGLADESH
ack in 1976, Mostafa Kamal started his journey with a small trading initiative for essential consumer goods at the Moulvi Bazaar, in the heart of Dhakas wholesale trading market. His vision was to switch from trading to industrialisation in order to cater to the demand of the local market and decrease overdependence on imports. Thus, Meghna Group of Industries (MGI) was formed, which is now one of the largest and fastest-growing conglomerates in the country. Mr Kamal set up his first industry in 1989 in the industrial park at Meghnaghat, Sonargaon, in the district of Narayangonj. Over the years, Meghna Group of Industries has added several industries to its portfolio, and today has 29 industries ranging from construction to fast-moving consumer goods (FMCG) to heavy industrial products. Presently, MGI employs about 15,000 permanent and casual workers.
We have been growing fast and there are several projects in the pipeline.
the world, with over 1.2 million homes fully utilising solar power. Son of the founder, and company director Niaz Rahim recently announced a new venture: We have set up a 50 megawatt power plant in Thakurgaon. This is the first time the government has allowed the production of power from the private sector. Mr Niaz is also confident about the future for business in his country. Decisions are now being made in a more timely manner. The government is focusing heavily on power resources and infrastructure development right now which is important, and which is going to help move Bangladesh forward as a nation.
BANGLADESH
government is very keen to complete projects such as this flyover and is giving us maximum support. If we need police support for anything, it is provided immediately, says Mr. Karim. Presently, we are facing traffic jam issues because we are digging up ground in the middle of a narrow road. There is some inconvenience, however Bangladeshis understand the value this project will bring once completed. We are receiving a lot of support from local people. Dhaka is one of the most congested cities in the world. The World Bank predicts its population, currently 13 million people, could rise to 25 million by 2020. After completion of the four-lane flyover, which will be named the Mayor Mohammad Hanif Flyover, the citys third elevated expressway will greatly improve links between the Dhaka metropolitan area and at least 30 other districts, including the port city of Chittagong, Mongla, Sylhet and Barisal. Superlati ve achievements The Orion Group has not only blazed trails in PPPs, but it has also taken real estate to new heights. It reshaped Dhakas skyline when it constructed the countrys tallest building, the 39-storey City Centre, and also has plans to create a new satellite town near the capital. Its pharmaceutical arm was the first company in Bangladesh to produce amino acids and to manufacture anti-cancer drugs, bringing down the cost of cancer medication from 2,100 taka (17) to 350 taka (2.85) per box. In agriculture, the group is currently collaborating with a Dutch company to grow mushrooms on two large plots of land. Our location and facilities are ideal, says Mr. Karim. European companies have tried going to China for these agroproducts, however they have found Bangladesh is a better more cost-effective producer. The company has plans to develop an agricultural industrial park and produce vegetables targeted at European markets.
nance on a build-own-operate-transfer (BOOT) basis. The concession agreement was sealed in June 2005 and construction began in June 2010. The Jatrabari-Gulistan flyover breaks new ground in Bangladesh. This is the first infrastructure project in Bangladesh under a public-private partnership (PPP) agreement. Previously there was no such type of investment and it was a dream that a private entity would be able to invest in infrastructural development, says Mr. Karim. Initially, the flyover was to be seven kilometres long, now it is 10 kilometres. The investment is around $290 million and we are working on raising these funds from completely local sources. In addition to entering unchartered financing territory, other challenges facing the Orion Group include the required construction time for the project being shortened by a year, to two and a half years construction time, and the physical constraints imposed by the site being in such a built-up area. The
Power gener at ion A reliable, affordable supply of energy is vital to maintaining Bangladeshs socio-economic development and industrialisation. The government has set a goal of providing electricity to all citizens by 2021, so power generation has been highlighted as another priority area for private-sector involvement. Through its joint ventures, IEL Consortium and & Ltd and Dutch Bangla Power & Associates Ltd, the Orion Group now has two 100MW power plants in operation. It is frustrating that our countrys international image is not so good, even though we did not take a single penny from the outside world; we raised the funds here and we completed a 100MW power plant in only 217 days. I challenge you to find another company that can complete such a project in the same timeframe using the particular European technology we have brought over, says Mr Karim. The group has been awarded two more concessions to build power stations generating 300MW and 650MW respectively. The government is serious about power production. We used to have a large natural gas reserve, however, now there is a shortage. So, we are going to set up a coal-based power plant, which will be much cheaper. We are on our way to producing electricity at low cost, says Salman Obaidul Karim, Orion Groups managing director and son of the chairman. In our power sector, demand is significant at the moment, which represents an opportunity for foreign involvement. Our companys projects have set examples showing foreign investors that infrastructure and power projects are feasible and can be completed quickly.
10
BANGLADESH
MADE IN BANGLADESH
An economy which once relied heavily on agriculture is now focused on improving its industrial sector fter gaining independence from Pakistan in 1971, the early Bangladeshi governments enforced a socialist economy upon its population with the nationalisation of all industries. The lack of an entrepreneurial culture resulted in a lack of engineers, technicians, managers and administrators. But by the mid-Eighties the government implemented policies aimed at encouraging private enterprise, investments and imports, and the Bangladeshi economy started to show signs of growth. Today, the country's economy is not only strong, but growing rapidly: according to the International Monetary Fund (IMF) Bangladesh ranked as the 43rd largest economy in the world, among the Next Eleven, or N11 of Goldman Sachs, with a gross domestic product of $269.3 billion (174 billion) in 2010. Growing at an average rate of 6-7 per cent per annum, more than half the GDP now comes from the service sector while a large part of the Bangladeshi work force continues to
Previously, Bangladeshi people were more interested in trading but gradually we are moving towards industrialisation.
DILIP BARUA, Minister of Industries,
industrialisation. Now, Bangladesh is in a transitional stage to move towards industrial business from trading. Our honourable Prime Minister is very concerned about this matter with a visionary outlook towards the concept of industrialisation, said the Bangladeshi Minister for Industries, Dilip Barua, recently.
he Bangladeshi leather industry developed during the 1970s and grew significantly in the 1990s. During that decade, the export market grew at an average rate of 10-15 per cent annually, averaging yearly exports that accounted for $225 million (145 million). Apex Adelchi Footwear Limited (AAFL), formerly Apex Footwear Limited, is one of the major manufacturers and exporters of leather footwear of Bangladesh that went into commercial production in the nineties. Though the company has diverse interests, Syed Manzur Elahi, chairman of Apex Group, says: Because our shoe business is our core strength, we will concentrate on that. Apex Adelchi first set up in Shafipur, once an economically depressed area where most of the population worked as farm hands, and transformed the regions working landscape. Following Apexs first factory opening, many of the smaller companies who made rubber soles, threads and insoles relocated to the area boosting the local economy, creating new employment opportunities and attracting workers from surrounding districts and towns. Apex Adelchi is a prime example of how the leather industry has developed over the past two decades. In 1990 AAFL produced 1,000 pairs of shoes each day and employed 350 people. Today, its workforce is made up of more than 7,500 people distributed in two factories and its production capacity totals 15,000 pairs of shoes per day. Continuous training programmes
and generous salaries have helped the company to maintain a strong and loyal work force. Mr Elahi says: I have been in the business since 1973 and I have never had a single strike. Over the years, I have learnt that to have a happy pool of workers, you need to make sure that floor management behaves properly when dealing with the workers. Our workers are to be given the respect they are due.
as China and Vietnam. It is currently the leading exporter of leather footwear from Bangladesh to major shoe retailers in Europe, North America and Japan. In 2010, the company exported over 3.6 million pairs of shoes to 120 major shoe retailers
I have been in the business since 1973 and I have never had a single strike.
Bangladeshs leather is known all over the world for its quality. This is due partly to the luxurious vegetation the country boasts which encourages large populations of livestock. Traditionally, natural farms and fields do not apply barbed wire fencing which can damage the skins of animals. AAFL, for example, has experienced significant export growth as global buyers are relocating to Bangladesh from countries such
Two per cent of the global livestock population is found in Bangladesh, providing Apex Tannery with plentiful stocks of raw material. It can produce from both local and imported sources freely without import duties and, due to the countrys pro-export policy, AAFL is able source any required shoe component duty-free for re-export. AAFLs achievements are not solely export-based; in 1997 it established its local retail wing and today it has the fastest growing shoe retail network in Bangladesh. Trading as Gallerie Apex within the domestic market, its product range of quality leather designs follows European trends and has received a phenomenal response from Bangladeshi consumers. Apex is also known as one of the countrys most socially responsible firms. Compliant with industrial and environmental regulations it also works in areas of healthcare and education to ensure the future of the country. Some of the companys corporate social responsibility (CSR) initiatives, for which it has an annual budget allocated, are helping drug victims re-establish themselves in society through retraining and employment and contributing to flood-affected victims in distressed areas. As part of its plan to continue expansion within the leather sector, Apex became one of the major pioneers and stakeholders in the apprenticeship programme for disaster-affected people organised by the Centre of Excellence for Leather Skills Bangladesh Limited (COEL), and is providing technical support and lending its premises over the next three years to prepare 2,400 new trainees. AAFL has set elevated objectives for the near future and aims to increase its export volume by 200 per cent and up its domestic sales 275 per cent by 2015. The stakes are high but the company is confident in its abilities to outshine global competitors.
national in Bangladesh. AM Faruque, managing director and chief executive officer of APL, says: I am very delighted with this groundbreaking agreement which will take advantage of both companies strengths to deliver high quality medicines to the maximum number of doctors, chemists and patients. Iftekharul Islam, managing director of SanofiAventis Bangladesh Limited, adds: Through this agreement we are appointing Apex Pharma as the distributor for our five selected products and we believe their broad coverage will be a useful addition for the purpose of offering quality medicines to a maximum number of doctors, pharmacies and patients. This year, APL also created history in the Bangladesh pharma industry by introducing the firstever team of professional graduate pharmacists as Medico-Marketing Executives.
The aim of this unique initiative is to enhance the quality of pharmaceutical company medicinal communication and services to the medical profession. It will bring a new dimension to the relationship between pharmaceutical manufacturers and the medical community that will provide a tangible benefit to the healthcare system by encouraging best use of APLs range of products. This initiative is comprised of more than 100 fully trained pharmacists in the first phase. Importantly, it also creates a new career path for pharmacists in Bangladesh. Apex is coming on in a big way, said Mr Faruque. Another milestone for APL this year was the signing of a comprehensive contract with Rob Walker GMP Consultancy Ltd (RWGMP) to obtain UK MHRA and Australian TGA accreditations for its purpose-built manufacturing facility. RWGMP is based in the UK and has vast experience in obtaining MHRA accreditations in Europe, Africa and Asia. APL is moving fast towards attaining its operational vision of becoming a global
centre of excellence for pharmaceutical manufacturing. The company intends to continue partnering with multinational companies to ensure access to the latest manufacturing technologies and newest products. Apex Pharma look set to achieve its vision to become one of the top 10 pharmaceutical manufacturers in Bangladesh within the shortest possible time.
BANGLADESH
11
SPORT
HOWZAT! Bangladesh has shown it can stage world-class events and has enhanced its position in the sporting world
he 2011 ICC Cricket World Cup was first time Bangladesh had co-hosted such a major international sporting event and enabled the former Pakistani province to display its capacity to showcase world-class sporting competitions and cemented its place as a global cricket destination. Headquartered in Dhaka, the Bangladesh Cricket Board (BCB) is the nations main governing body for the sport and was instrumental in the success of the competition. We got a lot of support from the ICC and from the government, says Abu Hena Mustafa Kamal, president of the board at BCB. The government gave us moral support, financial support for the development of our stadiums, and provided enough security. The government has also physically come to visit us and wanted to see that we can do it, so that we can upgrade our image to the world. Then from the Cricket Board, we had a professional and serious approach. The BCB was formed in 1972 and is responsible for the operation and development of cricket, maintenance of venues and selection of the national team. Our ideology for the World Cup was to get everyone in Bangladesh involved in it, says Mr Kamal. We fixed giant screens in all the district
so many people who are willing to spend money on cricket. But cricket is a game that needs a lot of money to nourish it and develop it, says Mr Kamal. During the World Cup I raised about $5 million [3.2 million] from the private sector for the benefit of the game. The BCB now hopes to build on the momentum generated by the publicity around the World Cup as it prepares for Bangladeshs upcoming role as the host for the ICC World Twenty20 championship in 2014. Twenty20 cricket, or T20 as it is also known, was originally introduced in England as a professional intercounty competition in 2003. A T20 game involves two
S.A.K. EKRAMUZZAMAN, managing director of RAK Ceramics, outlines the benefits of manufacturing in Bangladesh, and considers the countrys requirements for further economic growth Contributing to the nations economic success are companies such as RAK Ceramics, a manufacturer and marketer of ceramic tiles, bathroom sets and other sanitary ware established in 2000. With an average annual turnover of more than BDT 5 billion (over 42 million) in its 11 years of existence, RAK has established itself as one of the sectors leading manufacturers. Mr Ekramuzzaman, managing director of RAK, comments on the factors behind Bangladeshs success. We have a very enthusiastic workforce. The availability of labour is another strong success factor. If you offer a reasonable salary, the migration of workers is minimal. This, he says, has helped shaped present-day Bangladesh. Bangladesh is now self-sufficient. The people are not starving and a large market exists here. There are explored and unexplored markets here, both for local and international entrepreneurs. Regarding the ceramic industry, Mr Ekramuzzamans area of expertise, he says: I can say that, we have enough demand that we can sell what we produce in the same day. Our company is already booked for orders for the next six months.
However, Bangladeshs economy is in such a prime position that certain developments require urgent attention before economic growth continues, primarily infrastructure. Mr Ekramuzzaman shares this thought: We have very poor infrastructure, which needs to be built up first. We need to develop roads, highways, gas, and electricity amongst other aspects of the country. Public-private partnerships have been introduced in Bangladesh, though they are in their early stage. RAKs managing director is optimistic that they will continue to grow so as to aid the growth of both infrastructure and the economy as a whole. RAK is also making its way into the housing sector, and has already embarked on a project to build 2,500 flats in Dhaka city to help the lower-middle class population. Another plan for 5,000 flats is under way. RAK profits are shared with the community. We are contributing approximately 2 per cent of profit to assist with health and education programs. Maintaining a quality standard of life of its workers is one of the companys main concerns. We employ 5,000 people and pay the best salaries in Bangladesh. We provide 100 per cent life insurance coverage to employees. The company contributes 5 per cent of its profit before taxes towards the Workers Profit Participation Fund and Welfare Fund. We are just like a family, he explains.
Here, cricket is very popular, and nobody plays it just for money; we play for passion.
teams, each having a single innings of around 75 minutes, batting for a maximum of 20 overs. Hosting the ICC World Twenty20 competition will further heighten Bangladeshs international profile in the sport and strengthen the BCBs push for improved facilities nationwide. We are trying to spread cricket all over Bangladesh, says Mr Kamal. We are trying to arrange international cricket all over the country, or at least in the major cities of Bangladesh. School cricket is very popular and the BCB runs a talent programme that scours the country for the best young players in its attempt to develop Bangladesh as a regional hotspot for cricketing expertise. Here, cricket is very popular and nobody plays it just for money; we play for passion, says Mr Kamal. Just give us a little more time; Bangladesh will not let you down.
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BANGLADESH
We have the hills, we have the sea, we have vast plain lands, we have rivers, we have archaeologically important sites and most importantly, we have our wonderfully hospitable people.