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- Nov 29, 2009
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Japan keen to shift plants to Bangladesh
Japanese investors are interested in relocating their factories to Bangladesh to reduce their costs of production, said a senior official of the Japan External Trade Organisation (JETRO) yesterday.
Bangladesh should go for foreign direct investment (FDI) for diversification and support Japanese investment. They could support industrial diversification, Takashi Suzuki, the JETRO representative in Bangladesh.
He was speaking at a seminar on 'Diversification of Exports of Bangladesh to Japan', organised by Dhaka Chamber of Commerce and Industry (DCCI) in Dhaka.
Japanese companies have started to diversify production or procurement sites to places other than China due to a rise in labour costs, said Suzuki.
Bangladesh could take advantage of this and encourage more FDI support, he added.
Speaking as the chief guest, Commerce Minister Faruk Khan said Bangladesh wants to enhance trade with its trusted friend, Japan, by utilising the facilities provided by the Japanese government.
There is ample opportunity to enhance trade with Japan through product diversification and quality improvements. Our entrepreneurs will feel encouraged to utilise the facilities that Japan provides, said Khan.
Japanese Ambassador in Dhaka Tamotsu Shinotsuka said Bangladesh should remove bottlenecks like weak infrastructure, and an electricity and gas crisis, and ensure better road connectivity for better business operations.
These are essential to attracting foreign direct investment, particularly investment from a country like Japan, he said.
He urged the Bangladesh government to internationalise the rules of business and Japan will be happy to see Bangladesh's progress.
He said facilities, like relaxation of the rules of origin, will help promote trade and investment between the two countries.
Export Promotion Bureau (EPB) Vice Chairman Jalal Ahmed said Bangladesh has a small export basket and it depends on only a few commodities. Only five items contribute to about 90 percent of exports. It's very risky for an economy to be dependent on a few items.
He said the Japanese market is a growing market for Bangladesh and export diversification is urgently needed for better economic output.
Japan is the 3rd largest importer of garment products in the world. In 2009-10, Japan imported apparel worth about $30 billion, which is highly monopolised by China that comprises about 80 percent of total market share.
Bangladesh's share in the Japanese market is still tiny. But it is possible to attain at least $1 billion market share in the apparel market of Japan annually if there is concerted effort from both the private and public sectors, said Asif Ibrahim, president of DCCI.
According to EPB data, Bangladesh exported products worth $ 350.56 million while it imported products worth $1.26 billion from Japan in the last fiscal year.
Bangladesh mainly exports frozen food, readymade garments, knitwear, leather and jute goods to Japan. On the other hand, it mainly imports motor vehicles and machinery; electronic and electrical machinery; and iron, steel and plastic articles from Japan.
The DCCI president said Japan could be a lucrative market for Bangladesh due to its cost competitiveness.
He observed that China will be losing its market in the near future due to high labour costs and buyers are looking for new low cost suppliers like Bangladesh.
Japan keen to shift plants to Bangladesh
Japanese investors are interested in relocating their factories to Bangladesh to reduce their costs of production, said a senior official of the Japan External Trade Organisation (JETRO) yesterday.
Bangladesh should go for foreign direct investment (FDI) for diversification and support Japanese investment. They could support industrial diversification, Takashi Suzuki, the JETRO representative in Bangladesh.
He was speaking at a seminar on 'Diversification of Exports of Bangladesh to Japan', organised by Dhaka Chamber of Commerce and Industry (DCCI) in Dhaka.
Japanese companies have started to diversify production or procurement sites to places other than China due to a rise in labour costs, said Suzuki.
Bangladesh could take advantage of this and encourage more FDI support, he added.
Speaking as the chief guest, Commerce Minister Faruk Khan said Bangladesh wants to enhance trade with its trusted friend, Japan, by utilising the facilities provided by the Japanese government.
There is ample opportunity to enhance trade with Japan through product diversification and quality improvements. Our entrepreneurs will feel encouraged to utilise the facilities that Japan provides, said Khan.
Japanese Ambassador in Dhaka Tamotsu Shinotsuka said Bangladesh should remove bottlenecks like weak infrastructure, and an electricity and gas crisis, and ensure better road connectivity for better business operations.
These are essential to attracting foreign direct investment, particularly investment from a country like Japan, he said.
He urged the Bangladesh government to internationalise the rules of business and Japan will be happy to see Bangladesh's progress.
He said facilities, like relaxation of the rules of origin, will help promote trade and investment between the two countries.
Export Promotion Bureau (EPB) Vice Chairman Jalal Ahmed said Bangladesh has a small export basket and it depends on only a few commodities. Only five items contribute to about 90 percent of exports. It's very risky for an economy to be dependent on a few items.
He said the Japanese market is a growing market for Bangladesh and export diversification is urgently needed for better economic output.
Japan is the 3rd largest importer of garment products in the world. In 2009-10, Japan imported apparel worth about $30 billion, which is highly monopolised by China that comprises about 80 percent of total market share.
Bangladesh's share in the Japanese market is still tiny. But it is possible to attain at least $1 billion market share in the apparel market of Japan annually if there is concerted effort from both the private and public sectors, said Asif Ibrahim, president of DCCI.
According to EPB data, Bangladesh exported products worth $ 350.56 million while it imported products worth $1.26 billion from Japan in the last fiscal year.
Bangladesh mainly exports frozen food, readymade garments, knitwear, leather and jute goods to Japan. On the other hand, it mainly imports motor vehicles and machinery; electronic and electrical machinery; and iron, steel and plastic articles from Japan.
The DCCI president said Japan could be a lucrative market for Bangladesh due to its cost competitiveness.
He observed that China will be losing its market in the near future due to high labour costs and buyers are looking for new low cost suppliers like Bangladesh.
Japan keen to shift plants to Bangladesh
