More trade helps to cement ties

Ties between Bangladesh and Hong Kong will only strengthen, built on burgeoning two-way trade and increasing areas of cultural exchange.

Firm foundations are in place, helped by the migration of manufacturing and production from factories in South China and elsewhere. The stage is set for further rapid development, as Bangladesh takes advantage of its open, market-based economy and innovative private sector to attract foreign direct investment (FDI) and target annual growth rates of more than 8 per cent.

Last year, exports to Hong Kong hit US$218 million, and total trade volumes with the city were valued at US$1.2 billion. For the same period, FDI from Hong Kong topped US$63 million and, with the two governments negotiating an agreement on the avoidance of double taxation, the door is open for new investment and initiatives.

'We have a winning combination of a competitive, business-friendly environment and a cost structure that gives manufacturers good returns,' says Ashud Ahmed, Consul General of Bangladesh in Hong Kong. 'The country also has a strategic location between China, India and Southeast Asia, good regional connectivity, and access to markets worldwide.'

The garment and footwear sectors have been a traditional focus and will remain important. However, practical incentives backed by an industrious, low-cost workforce - among a population of 152 million - and improving infrastructure have seen many new ventures established in the pharmaceuticals, electronics, leather goods, light engineering, software and shipbuilding sectors.

Many of these enterprises are based in one of Bangladesh's six exclusive economic zones for foreign investors. There, they can rely on extensive assistance from local authorities with construction plans, start-up formalities and recruitment. In addition, there is the prospect of tax holidays and useful introductions to potential partners in the country's fast-expanding domestic economy.