Nation bucks economic downturn

PUBLISHED : Sunday, 26 March, 1995, 12:00am
UPDATED : Sunday, 26 March, 1995, 12:00am

AS Hong Kong and many other economies foundered through a miserable downturn last year, Bangladesh bucked the trend.

It respresented a big swing for a country once synonymous with natural disaster and dependency on international aid.

Depressingly regular floods and typhoons - along with at least two man-made setbacks, the trauma of partition and a failed post-liberation flirtation with socialism - had also conspired against progress.

However, the Dhaka Stock Exchange index doubled in value last year, reflecting the nation's economic health.

Bangladesh's priority is not to rely on foreign aid but to mount a concerted campaign to lure overseas investors.

The significance of this quantum leap in socio-economic policy should not be taken lightly. For many countries locked into the aid mentality, the easiest and most obvious option is to carry on depending.

Bangladesh, on the other hand, has embarked on a bolder and more positive mission: the task of attaining self-sufficiency.

Last year, more than a third of the money allocated to 'development projects' was funded domestically, compared to none in the early 1990s.

Foreign help continues to be required if the nation is to stand on its own for the first time in decades, but the help being sought mainly involves investment, rather than handouts.

First, a new 'open-door' economic policy has been formulated specifically with overseas investors in mind.

Also, since Bangladesh is a poor country, it has low labour and land costs, making it one of the cheapest production bases in Asia.

Business opportunities are, therefore, almost limitless.

'The country remains an undiscovered, attractive market for almost any product since consumers have not developed any distinct bias for specific products,' said S. H. M. B. Nur Chowdhury, Bangladesh's High Commissioner in Hong Kong.

'Prospects are immense.' The ultimate goal of the Prime Minister, Khaleda Zia, is self-reliance for the nation.

'Bangladesh's industrial, privatisation, foreign investment and trade policy's main thrust is towards this philosophy,' Mr Chowdhury said.

Yet Mrs Zia is pragmatic enough to concede: 'In order to achieve this goal, increased levels of investment, especially from abroad, will be required.' The 'bait' for foreign investors is tempting. They are now treated in exactly the same way as domestic investors and the climate could be described as supportive and promotional, rather than regulatory.

The thrust is towards 'rapid expansion of the private sector and a market economy'.

Mr Chowdhury said nearly all the complex barriers of the past had been removed and investment procedures had been vastly simplified.

In the financial arena, a dual foreign exchange rate that was in force until 1992 has been abandoned and the currency, the taka, is convertible.

'Bangladesh aspires to join the ranks of Asia's newly-industrialised countries,' Mr Chowdhury said.

'It is only a matter of time before we catch up.' Bangladesh's hopes are pinned on a more prosperous future in the 21st century, and the outlook appears to be promising.

The reputable Indian weekly, Business World, reported recently: 'Bangladesh has all the makings of being tomorrow's success story - unsung and mostly unnoticed - but a success story nevertheless.

'If luck holds, it could even become that cliche of the Asian age, a tiger.'