 |
| Ads by BDS |
In the last ten years, Bangladesh attracted substantial amounts of foreign direct investment (FDI).
1. The economic and fiscal reforms of Bangladesh, improvements in infrastructures and developing industry clusters have been amongst the main local stimuli to FDI.
2. Nevertheless the country continues to compete hard for every investment dollar.
3. In spite of the pressures from other competitive economies, in the eyes of many investors, Bangladesh remains the most cost competitive and industrious location to setup foreign subsidiary companies.
Steady export growth of almost 20% per annum in exports 2003-2007
Sources: UN World Investment Report 2009, UN Comtrade 2009.
Investment Environment
Compared to the other South Asian economies, Bangladesh offers an unparalleled investment climate. The below eight key-pointers to Bangladesh's investment climate are the significant indicators.
1. It is a country of largely homogeneous society with no major internal or external tensions and a population with great resistance in the face of adversity (e.g. natural calamities, like flood, draught, storm).
2. Bangladesh is a liberal democratic country. The population of this country irrespective of race or religion have been living in harmony and understanding for thousands years.
3. A broad unbiased political support for market oriented reform and the most investor-friendly regulatory administration in South Asia.
4. Trainable, passionate, hardworking and low-cost (even by regional standards) labor force is suitable for any labor-intensive industry.
5. Geographically the country is an ideal for global trade, with very convenient access to international sea and air routes.
6. Bangladesh is gifted with plentiful supply of natural gas, water and its soil is very fertile for any type of cultivation.
7. Though Bengali (Bangla) is the official language, English is widely used as the second language. The majority of the educated people can read, write and speak in English.
8. Due to low per capita GDP, present domestic consumption is not significant. However, it should always be considered that there exists a middle class with over 10% of the population. As economic growth picks up, the purchasing power of people is also growing substantially.
Not only that, Bangladeshi products are enjoying duty free and quota free access to the most of all developed countries. This access to the global market is helping further by the policy regime of Bangladesh for FDI is by far the best in South Asia. Most of Bangladeshi products enjoy complete duty and quota free access to EU, Canada, Australia and Norway. In limited scale, Bangladeshi products already found their access with lower duty in the markets of Thailand, India and Pakistan. As a continuous effort of Bangladesh, talks are underway with China, Russia, Malaysia and other neighboring countries in this regard too.
Bangladesh is a liberal democratic, moderate and homogeneous country. It is a multi party parliamentary democratic republic. Parliamentary elections are held on the basis of universal suffrage and the winner political party/coalition forms the government for the next five years.
Government has initiated various supportive policies initiatives to promote socio-economic development of the country. The key features of the Government industrial policies are indicated here as below:
1. To inflate the production base of the economy by accelerating the level of industrial investment.
2. To encourage the private sector to lead the growth of industrial production and investment.
3. To focus the role of the government as the facilitator in creating a suitable environment to expand the private sectors and constant economic growth.
4. To ensure public undertaking only in those industrial activities where public sector involvement is essential to facilitate the growth of the private sector and / or where there are over riding social concerns to be accommodated and private initiatives are absent.
5. To attract FDI in both export and domestic market oriented industries to make up for the inadequate domestic investment resources, and to obtain evolving technology and gain access to export markets.
6. To ensure the rapid growth of industrial employment by encouraging investment in labor intensive manufacturing industries, including investment in efficient small and cottage industries.
7. To generate female employment in higher skill categories through special emphasis on skill development training and motivation.
8. To increase industrial productivity and to move progressively to higher value added products through skill development and technology upgrading.
9. To boost operational efficiency in all remaining public manufacturing enterprises through appropriate management restructuring and pursuit of market oriented policies.
10. To diversify and rapidly increase export of manufactures.
11. To ensure a process of industrialization, which are environmentally secured and sound, and consistent with the resource endowment of the economy.
12. To promote balanced industrial development throughout the country by introducing suitable measures and incentives.
13. To utilize the existing production capacity effectively.
14. To coordinate all macro-economic policies.
15. To expand indigenous technology and to increase productions based on domestic raw materials and inputs.
16. To rehabilitate and support deserving sick industries of the country.
Its low labor costs of semi-skilled workers have been provided its advantage of competitiveness in the world. Bangladesh has an adequate pool of semi-skilled as well as unskilled workers who are willing to work at very competitive rates, thus enabling Bangladesh to access deep into the hearts of the international markets, with comparative and competitive cost advantages.
The government supports the principle of fair wages to the workers linked to increase levels of production. The wages may be fixed through collective bargaining processes. In case of insufficiency of the collective bargaining process, wages can be set by the ‘Minimum Wages Board’. The Minimum Wages Board tries hard to ensure a balanced view of both the interests of the management and the workers. The following examples indicate the average monthly basic wages and fringe benefits in US$ per worker in a private sector organization. In the final analysis, wages and other compensations are market set.
Wage (monthly in US$)
|
Unskilled
|
Semi-skilled
|
Skilled
|
Basic wages
|
30
|
50
|
70
|
Fringe benefits
|
20
|
25
|
30
|
Total
|
50
|
75
|
100
|
Overview
The financial sector in Bangladesh is continuously evolving towards a more modern and efficient system of finance which is supportive of greater investment and inclusive economic growth. The financial system of Bangladesh consists of The Bangladesh Bank, scheduled banks, non-bank financial institutions, micro finance institutions, insurance companies, co-operative banks, credit rating agencies and stock exchange.
Banking infrastructure (As of March, 2010)
Type of bank
|
No.
|
No. of branches
|
State owned
|
4
|
3,391
|
Specialized
|
4
|
1,365
|
Private
|
30
|
2,387
|
Foreign
|
9
|
58
|
Total
|
47
|
7,201
|
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
An overview of financial sector in Bangladesh
Source: Policy Analysis Unit (PAU), Bangladesh Bank
Investment freedom
The Foreign Investment Act of 1980 guarantees the right of repatriation of invested capital, profits, capital gains, post-tax dividends, and approved royalties and fees. Foreign firms are able to repatriate funds without much difficulty, provided the appropriate documentation is in order.
Economic freedom in Bangladesh
Bangladesh’s economic freedom score is 51.1, making its economy the 137th freest in the 2010 Index. Its overall score is 3.6 points higher than last year, mainly reflecting improvements in trade freedom and investment freedom. Bangladesh is ranked 29th out of 41 countries in the Asia–Pacific region. Bangladesh has enjoyed impressive economic growth of around 6 percent per year over the past five years, driven mainly by its limited but growing services and industrial sectors
Source: Index of economic freedom 2010, The Heritage Foundation
Comparison on economic freedom in Asia Pacific region
Name of the country
|
Business freedom (%)
|
Trade freedom (%)
|
Monetary freedom (%)
|
Investment freedom (%)
|
Bangladesh
|
59.4
|
58
|
66.6
|
45
|
Cambodia
|
39.9
|
70
|
70.5
|
60
|
China
|
49.7
|
72.2
|
70.6
|
20
|
India
|
36.3
|
67.9
|
67.5
|
35
|
Indonesia
|
53.1
|
77.9
|
70.8
|
35
|
Philippines
|
48.1
|
77.8
|
72.7
|
40
|
Singapore
|
98.2
|
90
|
80.9
|
75
|
Sri Lanka
|
71.8
|
62.2
|
56.8
|
15
|
Thailand
|
70.7
|
75.9
|
66.4
|
40
|
Vietnam
|
60.7
|
68.9
|
58.1
|
20
|
Source: Index of economic freedom 2010, The Heritage Foundation
Country's score over time
Source: Index of economic freedom 2010, The Heritage Foundation
Ten economic freedoms of Bangladesh
Source: Index of economic freedom 2010, The Heritage Foundation
Short history of banking
The banking system at independence (1971) consisted of two branch offices of the former State Bank of Pakistan and 17 large commercial banks, two of which were controlled by Bangladeshi interests and three by foreigners other than west Pakistanis. There were 14 smaller commercial banks. Virtually all banking services were concentrated in urban areas. The newly independent government immediately designated the Dhaka branch of the State Bank of Pakistan as the central bank and renamed it Bangladesh Bank. The bank was responsible for regulating currency, controlling credit and monetary policy, and administering exchange control and the foreign exchange reserves. The Bangladesh government initially nationalized the entire domestic banking system and proceeded to reorganize and rename the various banks. Foreign-owned banks were permitted to continue doing business in Bangladesh.
The insurance business was also nationalized and became a source of potential investment funds. Cooperative credit systems and postal savings offices handled service to small individual and rural accounts. The new banking system succeeded in establishing reasonably efficient procedures for managing credit and foreign exchange. The primary function of the credit system throughout the 1970s was to finance trade and the public sector, which together absorbed 75% of total advances.
The government's encouragement during the late 1970s and early 1980s of agricultural development and private industry brought changes in lending strategies. Managed by the Bangladesh Krishi Bank, a specialized agricultural banking institution, lending to farmers and fishermen dramatically expanded. The number of rural bank branches doubled between 1977 and 1985, to more than 3,330. Denationalization and private industrial growth led the Bangladesh Bank and the World Bank to focus their lending on the emerging private manufacturing sector.
Bangladesh Bank (BB)
Bangladesh Bank has been working as the central bank since the country's independence. Its prime jobs include issuing of currency, maintaining foreign exchange reserve and providing transaction facilities of all public monetary matters. Bangladesh Bank is also responsible for planning the government's monetary policy and implementing it thereby. Bangladesh Bank, which is the designated central monetary authority of the People's Republic of Bangladesh, has a governing body comprising of nine members with the Governor as its chief. Apart from the head office in Dhaka, it has nine more branches, of which two in Dhaka and one each in Chittagong, Rajshahi, Khulna, Bogra, Sylhet, Rangpur and Barisal.
Source: Bangladesh Bank
Scheduled Banks (SB)
Out of 6,562 Scheduled Bank branches operating in the country, up to end December 2006 the nationalized commercial Bank's operate 3,384 branches, of which 2,146 are in rural areas and 1,238 are in urban areas; Scheduled Banks have 1,354 branches of which 1,200 are in rural areas and 154 are in urban areas; Public Commercial Banks have 1,776 branches of which 488 are in rural areas and 1,288 are in urban areas.
Source: Bangladesh Bank
In Bangladesh 119 cooperative banks are operating, of which 64 are central cooperative banks, 48 are land mortgage and the rest seven are other cooperative banks. The maximum share of total assets, 90%, is controlled by central cooperatives. Similarly the maximum share deposits (85%) and advances (90%) are handled by the same central cooperatives.
Investment Corporation of Bangladesh (ICB)
The Investment Corporation of Bangladesh was established in 1976 with the objective of encouraging and broadening the base of industrial investment. ICB underwrites issues of securities, provides substantial bridge financing programmers’, and maintains investment accounts, floats and manages closed-end & open-end mutual funds & closed-end unit funds to ensure supply of securities as well as generate demand for securities. ICB also operates in the DSE and CSE as dealers.
Source: Investment Corporation of Bangladesh
Securities and Exchange Commission (SEC)
The Securities and Exchange Commission (SEC) was established on 8th June, 1993 under the Securities and Exchange Commission Act, 1993. The Chairman and Members of the Commission are appointed by the government and have overall responsibility to administer securities legislation. The Commission is a statutory body and attached to the Ministry of Finance.
Dhaka Stock Exchange (generally known as DSE) is the main stock exchange of Bangladesh. It is located in Motijheel- the heart of the Dhaka city and its central business district. It was incorporated in 1954. Dhaka Stock Exchange is the first stock exchange of the country. At the end of March 2010, the amount of all issued capitalize securities and debenture was $8,179m which is 23% greater than the value of June 2009 ($6,611m). During 30th June 2009, the price of all securities of Dhaka Stock Exchange was $18,951m, which has increased by 73% at the end of March 2010 where the value was $32,850m. The share indices of DSE increased by 85%, where the value was $434m on June 2009 and reached to $805m at the end of March 2010.
Dhaka Stock Exchange is a public limited company. It is formed and managed under the Companies Act 1994, Security and Exchange Commission Act 1993, Security and Exchange Commission Regulation 1994, and Security Exchange (inside trading) regulation 1994. According to stock market rule, only members can participate in the floor and can buy shares for himself or his clients. At present it has 238 members.
Source: Dhaka Stock Exchange
* As of March, 2010 1 crore Tk = 10 million
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Chittagong Stock Exchange (CSE)
Chittagong Stock Exchange (generally known as CSE)-the first automated and modern trading bourse in the country. The Chittagong Stock Exchange began its journey in 10th October of 1995 from Chittagong city through the cry-out trading system with the promise to create a state-of-the art bourse in the country. Introduction of automated trading system in June 1998 replacing the practice and culture of age-old manual cry-out system of trading in the stock market of Bangladesh was a revolutionary step made by the Chittagong Stock Exchange in the history of the country's capital market. At the end of March 2010, issued capital increased by 29% compare to June 2009, reached to the amount of $2,539m. In addition, total market capital had a growth of 93% at March 2010, compare to June 2009, reached to the amount of $26,894m. Moreover, share index reached to 12,194 at the end of March 2010, with an increment of 54% compared to the index of June, 2009.
Source: Chittagong Stock Exchange
* As of March, 2010 1 crore Tk = 10 million
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Investment opportunities
1. Foreign investment or joint venture investment in the Export Processing Zones (EPZs) or outside EPZs (with the exception of the five industries mentioned earlier).
2. Portfolio investment by purchasing shares in publicly listed companies through the stock exchange.
3. Investment in infrastructure projects such as power generation (private power generation policy announced); oil, gas and mineral exploration, telecommunication, ports, roads and highways.
4. Outright purchase or purchase of shares of state-owned enterprises, which are under process of privatization.
5. Investment in private EPZ (Private EPZ Act recently passed).
Legal security for investment
1. Foreign Private Investment (Promotion and Protection) Act, 1980 ensures legal protection to foreign investment.
2. Bangladesh is a member of Multi-Lateral Investment Guarantee Agency (MIGA), Overseas Private Investment Corporation (OPIC) of USA and International Centre for Settlement of Industrial Disputes (ICSID)
3. Member of World Intellectual Property Organization (WIPO) and World Association of Investment Promotion Agencies (WAIPA).
Non-bank financial institutions are an important part of financial system in Bangladesh, operations are regulated under the Financial Institutions Act, 1993. The non-bank financial institutions consist of investment, finance, leasing companies etc. There were 29 financial institutions operating in Bangladesh as of 31 December 2006. Of these one is government owned, 15 are local (private) and the other 13 are established under joint venture with foreign participation. Bangladesh Bank has introduced a policy for loan and lease classification and provisioning for non-bank financial institutions from December 2000 on a half-yearly basis. Among the 29 financial institutions, 12 have been listed in the stock exchanges up to 31 December 2006 to strengthen financial capability and the rest are under process to be listed in due course.
The insurance sector is regulated by the Insurance Act, 1938 with regulatory oversight provided by the controller of insurance on authority under the Ministry of Commerce. A separate insurance regulatory authority is being established. A total of 62 insurance companies have been operating in Bangladesh, of which 18 provide life insurance and 44 are in the general insurance field. Among the life insurance companies, except the state-owned Jiban Bima Corporation foreign owned American Life Insurance Company, and the rest are private. Among the general insurance companies, state-owned Shadharan Bima Corporation is the most active in the insurance sector. A total of 31 insurance companies are listed in the capital market, of which eight offer life insurances.
Micro finance institutions (MFI)
Micro fiance institutions in Bangladesh were left unregulated for a long time since their inception. The government, with the close cooperation of Bangladesh Bank, undertook efforts to establish a regulatory framework which culminated in the enactment of the Micro credit Regulatory Authority Act, 2006. An executive board consisting of eight members is responsible for executing the general and administrative tasks of the management. The board consists of the Governor of Bangladesh Bank as ex-officio chairman, six government officials nominated by the government and one executive vice-president who serves as the member secretary of the board. The main responsibilities of the authority include issuance and cancellation of the license for micro credit, overseeing, supervising and facilitating the entire activities of micro finance institutions.
Recent developments in the financial sector
The stock market grew by 82% in 2009 compared to the year 2008, representing a total capitalisation of $275m. In order to encourage corporate houses with good fundamentals to come forward with new Initial Public Offerings (IPOs), the regulatory body introduced the ‘book building mechanism'. In the year 2009, the Securities and Exchange Commission also asked Dhaka Stock Exchange to open Order Confirmation Transaction (OCT) market to facilitate trading of de-listed companies from the floor. Moreover, preparations are afoot to set up Bangladesh Institute of Capital Market to work for its expansion. The scheduled banks in Bangladesh will be able to get credit reports of their clients online from the Credit Information Bureau from mid 2010. BRAC bank plans to open exchange houses in Malaysia, Singapore and Italy, in order to attract more remittances through its own channel.
The Asian Development Bank (ADB) has signed deals with 12 local private commercial banks for expansion of its trade finance facilitation programme in Bangladesh. Under the agreement, the banks will be able to offer more trade financing support to their clients particularly exporters and importers through international banks. The banks are Bank Asia Ltd., BASIC Bank Ltd., Dhaka Bank Ltd., Dutch Bangla Bank Ltd., Eastern Bank Ltd., Export Import Bank of Bangladesh Ltd., National Bank Ltd., Premier Bank Ltd., Prime Bank Ltd., Southeast Bank Ltd., Standard Bank Ltd., and United Commercial Bank Ltd.
Quick facts relating to the financial sector in Bangladesh
1. Bangladesh has applied for membership of Egmont Group to operate its newly-established financial intelligence unit in line with international standard.
2. Bangladesh Post Office is going to introduce postal cash card (e-money order) system through which people, across the country even in the remotest areas, will be able to send and receive money through mobile phone.
3. The central bank has raised the ceiling of foreign currency for Bangladesh nationals allowing them to spend more while traveling abroad.
4. The Bangladesh Bank launched the automation project of its Credit Information Bureau aiming at providing credit information in a faster and efficient way.
5. Bangladesh Bank has once again lowered different banking charges, fees and commissions to provide assistance to businessmen hurt by falling exports.
Economic data relating to the financial sector of Bangladesh
Money and credit (bn* taka)
Money data
|
2006-07
|
2007-08
|
2008-09
|
2009-10*
|
Money suppy (narrow)
|
501.68
|
593.14
|
664.27
|
775.79
|
Money supply (broad)
|
2,115.04
|
2,487.95
|
2.965.00
|
3,375.79
|
Scheduled banks time deposits
|
1,613.36
|
1,894.81
|
2,300.73
|
2,600.00
|
* As of March, 2010
Sector: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Government finance (bn* taka)
Data
|
2006-07
|
2007-08
|
2008-09
|
2009-10
|
Revenue receipts
|
494.72
|
605.39
|
691.80
|
794.84
|
Revenue expenditure
|
454.12
|
569.89
|
671.25
|
769.38
|
Public sector development expenditure
|
179.16
|
243.16
|
247.12
|
308.27
|
Foreign exchange reserves (m US$)
|
5,077
|
6,149
|
7,471
|
10,117
|
Yearly interest rates (% per annum)
End of period
|
Bank rate
|
Call money market's weighted average interest rates on
|
Schedule bank's weighted average interest on
|
Spread
| ||
borrowing
|
lending
|
deposits
|
advances
| |||
2010*
|
5.00
|
3.51
|
3.51
| |||
2009
|
5.00
|
5.04
|
5.04
| |||
2008
|
5.00
|
10.27
|
10.27
|
7.31
|
12.31
|
5.00
|
2007
|
5.00
|
9.31
|
9.31
|
6.77
|
12.75
|
5.98
|
2006
|
5.00
|
7.17
|
7.17
|
6.98
|
12.99
| |
2005
|
5.00
|
8.41
|
8.41
|
5.90
|
11.25
|
5.35
|
2004
|
5.00
|
4.93
|
5.74
|
5.56
|
10.83
|
5.27
|
2003
|
5.00
|
6.88
|
8.17
|
6.25
|
12.36
|
6.11
|
2002
|
6.00
|
9.49
|
9.56
|
6.49
|
13.09
|
6.67
|
*As of March, 2010.
Bank deposits ($ m)
Items
|
February, 2010
|
January, 2010
|
February, 2009
|
% changes of February, 2010 over
| |
January, 2010
|
February, 2009
| ||||
Demand deposits*
|
4,885
|
4,786
|
3,655
|
2.03
|
33.63
|
Time deposits*
|
36,919
|
36,094
|
30,398
|
2.29
|
21.45
|
Total
|
41,804
|
40,880
|
34,054
|
2.26
|
22.76
|
* Excludes inter-bank and government deposits
m=million, bn=billion. Source: Statistics Department, Bangladesh Bank.
1. Land and factory building are available on rental basis.
2. The zone helps to provide electricity, water, gas and
telecommunications.
3. Import and export permits are issued by EPZ within 24 hours.
4. Work permits are issued by BEPZA.
5. EPZ is a secured and protected area.
6. Recreational facilities are available.
7. Availability of foodstuff and beverage on payment of nominal tax
foreigners working in EPZs.
8. Potential investors are required to deal only with BEPZA for investment and all other operational purposes.
INCENTIVES AVAILABLE FOR EPZ INDUSTRIES
FISCAL INCENTIVESTax Exemption
1. Tax holiday for 10 years
2. Exemption of income tax on interest on borrowed capital.
3. Relief from double taxation subject to bilateral agreement.
4. Complete exemption from dividend tax for tax holiday period for foreign nationals.
5. Exemption of income tax on salaries of foreign technicians for 3 years subject to certain conditions.
Duty Free Import and Export
1. Duty free import of machinery's, equipment and raw materials.
2. Duty free import of three motor vehicles for use of the enterprises in
EPZs under certain conditions.
3. Duty free import of materials for construction of factory buildings in the
zones.
4. Duty free export of goods produced in the zones.
NON-FISCAL INCENTIVES
I. Investment
1. All foreign investment secured by law.
2. No ceiling on extent of foreign investment.
3. Full repatriation of profit and capital permissible.
4. Repatriation of investment including capital gains, if any, permissible.
5. Remittances allowed in following cases:
- All post tax profit and dividend on foreign Capital.
- Savings from earnings, retirement benefits, personal assets of
individual on retirement/termination of services.
- Approved royalties and technical fees.
- No permission required for expansion of the project or
product diversification.
II. Project financing and banking
1. Offshore banking facilities available.
2. Local and international banking facilities also wide-open.
III. Import
1. Freedom from national import policy restrictions.
2. Import of raw materials also allowed on Documentary Acceptance (DA) basis.
3. Advantage of opening back-to-back LC for certain types of industries for import or raw materials.
4. Import of goods from the domestic tariff area permissible.
IV. Project Implementation
o Re-location of existing industries from one zone to another within the country permissible.
V. Operation
1. Sub-contracting within EPZ allowed.
2. Inter-zone and intra-zone export permitted
3. All customs formalities done at the gate site of the respective factory building within the zone.
4. Permission for import/export given in the same day.
5. Repairing & maintenance's of machinery's and capital equipment from domestic tariff area allowed.
VI. Employment
1. Liberal employment of foreign technicians/experts allowed.
2. Foreigners employed in the zones enjoy equal rights similar to those of Bangladesh nationals.
3. Law forbids formation of external politics influenced labor union within the zones but welfare council, which has elected representation of the employees.
VII. Available Support Services
Customs Office, Post office, Medical Center, Fire Station, Police Station.
Foreign Direct Investment (FDI) in Bangladesh
Foreign Direct Investment (FDI) has played a key role in the modernisation of the Bangladesh economy for the last 15 years.
Inflows of foreign direct investment
There was an inflows of $666m foreign direct investment in 2007 which raised significantly in 2008 to $1086m. As of June 2009, inflows of foreign direct investment recorded to $358m.
Inflows of foreign direct investment during 2001-2009*
*As of June, 2009
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Private investment statistics
Year
|
Proposed
local investment
|
Proposed
foreign investment
|
Total proposed
investment
|
Growth
%
| |||
Project
|
US$ m
|
Project
|
US$ m
|
Project
|
US$ m
| ||
2005-2006
|
1,754
|
2,662.31
|
135
|
3,621.15
|
1,889
|
6,283.46
|
125%
|
2006-2007
|
1,930
|
2,848.98
|
191
|
1,728.26
|
2,121
|
4,577.24
|
(-27%)
|
2007-2008
|
1,615
|
2,833.76
|
143
|
787.39
|
1,758
|
3,621.15
|
(-21%)
|
2008-2009
|
1,336
|
2,480.72
|
132
|
2,137.53
|
1,468
|
4,618.25
|
27%
|
2009-2010*
|
876
|
1,831.44
|
92
|
617.68
|
968
|
2,449.12
|
-
|
* February, 2010
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Foreign and joint venture investment
In the year 2009-10 (February), there were 89 new foreign and joint venture investment projects registered to BOI which amount to $590m. The projects were invested to mainly in the service, engineering, clothing and agricultural sectors.
Sector-wise foreign and joint venture investment during 2009-2010*
* As of February, 2010
Countrywise foreign and joint venture investment during 2009-2010*
Country
|
No. of projects
|
Proposed investment (US$ m)
|
Saudi Arabia
|
3
|
478,652.17
|
Australia
|
4
|
2,036.23
|
USA
|
5
|
2,990.33
|
Finland
|
2
|
3,023.89
|
India
|
9
|
8,451.53
|
South Korea
|
12
|
33,768.91
|
Malaysia
|
3
|
3,056.52
|
Netherlands
|
5
|
8,544.76
|
China
|
12
|
21,000.36
|
United Kingdom
|
5
|
3,507.76
|
Pakistan
|
2
|
990.91
|
Japan
|
8
|
2,624.85
|
Denmark
|
1
|
1,217.39
|
Sri Lanka
|
2
|
646.23
|
Canada
|
2
|
1,017.23
|
Taiwan
|
1
|
502.97
|
Singapore
|
4
|
1,929.62
|
Turkey
|
1
|
150.94
|
Greece
|
1
|
156.81
|
Italy
|
2
|
1,039.95
|
Hong Kong
|
5
|
14,805.94
|
Total
|
89
|
590,114.91
|
As of February, 2010
Source: Bangladesh Economic Review-2010 (Bangla version), Ministry of Finance
Living in Dhaka
Expatriates living in Dhaka have found it to be an affordable, safe and comfortable place to live in, with a good range of expatriate housing readily available in centrally located apartments. Popular places to live in include Gulshan, Baridhara and Banani. Most expatriates live in these areas. A quality apartment rents for $700-$1,000/month. Luxury houses rent from $1,000-$1,500 (luxury units).
In several suburban areas, quiet and secluded housing are also available for rent. For those visiting Bangladesh, Dhaka offers several international standard hotels including the Dhaka Sheraton and the Sonargaon (a Pan-Pacific Hotel). These hotels provide deluxe accommodation, restaurants, health clubs and entertainment facilities. In addition there are a number of medium standard hotels and guest houses in Dhaka and Chittagong to accommodate the expatriates.
Daily living items
|
Typical costs (Dhaka)
|
Accommodation
| |
Rental of 2-3 bedroom unfurnished apartments
|
US$ 600-1,200/month
|
Rental of 3-4 bedroom unfurnished apartments
|
US$ 900-1,500/month
|
Domestic help/maid services
| |
Average wages for a full time living maid
|
US$ 50-80/month
|
Utilities
| |
Electricity
|
US$ 100-150/month
|
Gas
|
US$ 10-15/month
|
Groceries
| |
Car rental prices
| |
Low price cars (900-1299cc)
|
US$ 10,000-12,000 excl. tax and duty
|
Compact cars (1300-1799cc)
|
US$ 25,000-30,000 excl. tax and duty
|
Family cars (2500cc upwards)
|
US$ 35,000-75,000 excl. tax and duty
|
Petrol & gas
| |
Unleaded petrol
|
US$ 1.12/liter (Dec. 2009)
|
CNG
|
US$ 0.24/cubic metre (Dec. 2009)
|
Car operating expenses
| |
Annual road tax
|
US$ 73
|
Eating out (per person)
| |
Formal 3-course dinner at top restaurant
|
US$ 50-100
|
Simple meal at coffee shop of a 5-Star hotel
|
US$ 10-20
|
Rental accommodation
Expatriates in Bangladesh have found it to be an affordable, safe and comfortable place, with acceptable expatriate housing readily available in centrally located apartments. Many expatriates live in the Dhaka areas of Gulshan, Baridhara, and Banani. A typical apartment will rent for $800-$1,200/month, houses for $1,200-$1,500 (luxury units).
Hotels
Dhaka offers several 5 star hotels. They include the following:
Schools
A range of private, international schools are also available in Dhaka city. American International School, which provides education of grades one to 12, is located near the high-class residential area of Gulshan in Dhaka. A Japanese school is located in the residential area of Baridhara in Dhaka. The school is managed by the Japanese Association in Bangladesh.
Following is a selection of schools and their website addresses:
Healthcare
Basic health care needs can be met at any of the country's hospitals or clinics, or by a foreign-trained registered physicians, engaged in various state owned and private hospitals and clinics. The majority of medical staff are are highly qualified, well experienced and educated in USA, UK, Japan, and other European countries.
Several of the hospitals, especially those situated in Dhaka are at par with the excellent hospitals that can be found in Singapore, Malaysia and Thailand. Notable hospitals in Dhaka include:
Entertainment and recreation
Dhaka city offers a wide variety of entertainment. Cultural shows, concerts, fashion show events, and international cuisine, all on par with international standards, are found every day of the week in the popular districts. Dhaka city offers a range of private clubs, the most popular ones being International Club, Dhaka Club, Gulshan Club and American Club.
Workdays and business hours
Bangladesh observes a Friday and Saturday weekend. Business hours are 9:00 - 17:00. Banks observe the same hours while industry has a 48-hour week.
Costs of Doing Business
The cost of doing business in Bangladesh is highly competitive in comparison to other economics in the region. The following table summarizes the relevant costs typically incurred by businesses.
Summary of business costs
Land
|
US$
| |
Average price of developed land in the different industrial belts varies depending on location (price per square meter).
|
10.0-15.0
| |
Construction
| ||
Average per square meter
|
100-125
| |
Gas tariff
| ||
Average per '000 meter
|
64
| |
Power tariff
| ||
Average per kW/h
|
0.07
| |
Human resources: labor force
| ||
Average per month depending on skill level
|
50-100
| |
Human resources : management salaries
| ||
Mid-level: average US$ per month depending on the skills and experience
|
400-500
| |
Top-level: average US$ per month depending on the experience
|
1000-2500
| |
Sea freight (in US$ approx.)
| ||
Destinations
|
20'FCL*
|
40'FCL
|
Major European ports
|
`900
|
1,800
|
USA - east coast (NY)
|
2,000
|
900
|
USA - west coast (LA)
|
1,900
|
2,550
|
Canada (Toronto/Montreal)
|
2,700
|
3,700
|
Australia (Melbourne)
|
800
|
1,600
|
New Zealand (Auckland)
|
1,250
|
2,400
|
Hong Kong
|
500
|
900
|
UAE (Dubai)
|
800
|
1,600
|
TAX STRUCTURE
| ||
Personal income:
| ||
On the first Tk. 165,000
|
Nil
| |
On the next Tk. 275,000
|
10%
| |
On the next Tk. 325,000
|
15%
| |
On the next Tk. 375,000
|
20%
| |
On the balance
|
25%
| |
Corporate income:
| ||
Publicly traded company
|
27.5%
| |
non-publicly traded company
|
37.5%
| |
Bank, insurance and financial company
|
45%
| |
Mobile phone operator company
|
45%
| |
* FCL=Full container load
Note: The above costs are for reference purpose only. For specific and detailed information, you may contact relevant service agencies, business consultants etc.
No comments:
Post a Comment