Bangladesh misses out on US duty benefits to travel goods

The US has extended its generalised system of preferences to a new product — travel goods — but despite being a strong player in the segment, Bangladesh will miss out on the opportunity as the trade benefit is currently suspended for the country. The US government last month included some travel goods like luggage, backpacks, handbags, and pocket goods such as wallets in the GSP mainly for least developed countries. The countries that will be benefitted from the move are Myanmar, Nepal, Cambodia and some African nations under the African Growth and Opportunity Act (AGOA), even though the countries are not strong in manufacturing these goods. US retailers and brands urged the United States Trade Representative (USTR) to offer GSP to more countries, as the existing countries enjoying the trade benefit cannot meet the demand for travel goods. Bangladesh has already applied to the USTR, the chief trade negotiation body of the US government, for the reinstatement of the trade privilege, which was scrapped in June 2013 on grounds of poor labour rights and workplace safety. But the Obama Administration did not give in, although Bangladesh has fulfilled almost all the 16 conditions attached to the revival of the GSP.

Source: http://www.thedailystar.net/business/bangladesh-misses-out-us-duty-benefits-travel-goods-1303165

Foreign Direct Investment (FDI) rises 9.3%

Foreign investment increased 9.3% year-on-year in fiscal 2015-16 due to an improvement in reinvestment in existing companies. Last fiscal year, net foreign direct investment stood at USD 2.0 billion in contrast to USD 1.8 billion a year earlier, according to data from the central bank. Foreign investment is split into three categories: equity, reinvestment of earnings and intra-company loan. Last fiscal year, equity capital or new investment declined 4.4% from a year earlier to USD 505.0 million. However, reinvestment of earnings edged up 1.0% to USD 1.2 billion. Intra-company loans more than doubled year-on-year to USD 344.0 million during the period. More than 50.0% of the recent FDI are actually reinvestment by existing companies. This is a positive sign since it indicates that the foreign companies are earning sufficient revenue to run their business and their confidence is growing, said a World Bank report released early this month. On the other hand, a deceleration in the contribution of equity capital to the total share of FDI inflows is indicative of the continuing lack of enthusiasm on the part of new investors to invest in Bangladesh, the report, Bangladesh Development Update, added. The WB comment comes at a time when fresh foreign investment dropped about 10.0%.

Source: http://www.thedailystar.net/business/fdi-rises-927pc-1303174

Telecom operators lose 7.0% of customers in August

The telecom industry faced a setback in August with its active SIM connections declining about 7.0% from the previous month. The top four mobile phone operators experienced the drop while Teletalk and Citycell maintained their position due to the use of different calculation tools, according to data from Bangladesh Telecommunication Regulatory Commission. The total number of active users in Bangladesh was 119.7 million in August, compared to 128.9 million in July. The six operators lost 3.7 million subscribers in July. The industry has been witnessing a decline in six out of the eight months to August. This is because the operators are adjusting to the drop in subscribers after biometric SIM re-registration that ended on May 31, said a top official of the regulator. As per rules, operators have to count any number as active unless it remains off for three consecutive months. In August, leading mobile phone operator Grameenphone lost 1.8 million (3.2%) from its customer base that pushed down its total to 54.5 million. Banglalink’s subscriber base came down to 28.9 million in August as the operator lost 2.4 million or 7.6% of subscribers in the month. Robi lost 3.6 million customers or 13.3% of its active customer base in the month that brought down its total to 23.3 million. Fourth largest operator Airtel lost 15.1% of its active customer base and came down to 7.9 million in August.

Source:
http://www.thedailystar.net/business/telecom-operators-lose-7pc-customers-aug-1303168
http://www.newagebd.net/article/1334/mobile-cos-shed-92-lakh-users-from-lists-in-aug

Bangladesh outbids China as top cotton importer

Bangladesh has overtaken China as world’s top cotton importer with a significantly expanding global market share to feed stronger demand from apparel makers. Such transition in the arena of import of raw materials for the garment industry is adjudged by the US Department of Agriculture. In the year ending July 31, 2016, the overall cotton import increased by 500,000 bales to 6.2 million bales, reinforcing Bangladesh’s position as the world’s largest importer of the item in 2015/16, said the USDA last week. Meanwhile, consumption has gone up by 300,000 bales, to 6.1 million bales, as market reports attest to growth of spinning, the USDA explained. For the 2016/17 year, the USDA has forecast imports to increase by 400,000 bales to 6.3 million, and use to 6.4 million. This raises Bangladesh’s share of global imports to just over 18.0%–more than double of the volume seen five years before. Currently, around 400 spinning units are in operation across the country.

Source: http://print.thefinancialexpress-bd.com/2016/10/24/154894

Dhaka Stock Exchange (DSE) on the lookout for strategic partners

Dhaka Stock Exchange is desperately looking for strategic investors to sell shares to, as part of a regulatory requirement. Although the premier bourse and the Chittagong Stock Exchange were demutualized three years back, they are yet to find any strategic investor in line with the demutualization scheme. The deadline to get strategic partners ends in December. Under demutualization rules, 25.0% shares of the bourses have been kept in a block account for the strategic investors, while another 35.0% have been set aside for institutional and individual investors. The rest 40.0% is owned by existing shareholders, who are commonly known as stockbrokers and stock dealers. In recent times, the DSE sat with some 10 local and international institutions, offering them to be strategic partners. As part of its latest effort, the DSE also published ads in newspapers last week, seeking proposals from potential strategic investors by November 15. In December last year, Bangladesh Securities and Exchange Commission asked the twin bourses to find strategic investors this year to sell shares to them. As per the demutualization scheme, which was approved by the BSEC in September 2013, a strategic investor should have the experience of managing exchanges or a business so that the tie-up could form an effective synergy.

Source: http://www.thedailystar.net/business/dse-the-lookout-strategic-partners-1303162

China beats India to be Bangladesh’s top energy partner

As Chinese President Xi Jinping visited Bangladesh recently, he announced a slew of agreements, among them investments in two coal-fired power plants in Bangladesh, according to http://scroll.in. These are the 1,320 megawatt (MW) thermal power plant in Payra located in the southern district of Patuakhali, and the 1,320 MW thermal power plant in Banshkhali located in the port city of Chittagong. Unnoticed by others, this marked the first time that Chinese-Bangladeshi energy cooperation exceeded that between India and Bangladesh. In 2009 Bangladesh had planned to establish two 1,320 MW capacity coal-fired power plants at Rampal near the protected Sundarbans with the assistance of India. But late this year, Bangladesh has slowly retreated from the idea of building the second plant after mass protests by local citizens.

Source: http://print.thefinancialexpress-bd.com/2016/10/24/154887

Low skill, poor business environ overshadow country’s advantages

A US rating agency has ranked Bangladesh as the world’s most cost-competitive destination for outsourcing. In a latest global survey conducted by the agency, the country has beaten world’s top outsourcing destinations like India, China, Malaysia and Brazil to secure the highest score in terms of financial attractiveness. However, despite such outstanding score in terms of cost-competitiveness, Bangladesh secured 26th position in the overall survey output due to very low score in terms of skill and business environment. The findings were revealed in the latest edition of the Global Services Location Index of American global management consulting firm A.T. Kearney. The research paper analyzes and ranks top 55 countries for outsourcing worldwide based on scorecards in three areas, namely, financial attractiveness, people’s skills and availability, and business environment.

Source: http://www.thefinancialexpress-bd.com/2016/10/24/50458/Low-skill,-poor-business-environ-overshadow-country’s-advantages

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