Weekly News Clippings (September 26, 2013)

Bangladesh may get 95% duty-free access to China (Dhaka Tribune, September 26, 2013)
China will increase the duty-free access of Bangladeshi products to its market up to 95% to boost the trade relations between the two countries and to support Bangladesh in bringing down its trade deficit with the trading partner. Chinese Foreign Minister Wang Yi said this when he met Prime Minister Sheikh Hasina at the Conference Building of the UN Headquarters in New York. The Prime Minister is there on an eight-day official visit to attend the 68th Session of the United Nations General Assembly (UNGA).

CPD for Tk 6,560 minimum wage (The Daily Star, September 25, 2013)
Civil society think tank Centre for Policy Dialogue (CPD) has recommended Tk 6,560 as the minimum wage for an entry-level worker in the country’s apparel sector. The CPD came up with the recommendation after conducting a survey, because a Minimum Wage Board comprised of representatives from the government, workers and factory owners is working to set the entry-level wage. The proposed minimum wage has been estimated based on the upper poverty line of Tk 6,444.

Bangladesh secures 161st spot in internet usage (The Daily Star, September 23, 2013)
Bangladesh stands 161 out of 194 countries in internet usage with 6.1 percent of its population having access to the web in 2012. According to a report “State of Broadband 2013; Universalising Broadband”  published by the Broadband Commission, a conjunction with International Telecommunication Union (ITU) and Unesco, internet usage in Bangladesh is ahead of Afghanistan that ranked 165 with 5.5 percent internet users and Myanmar at 189 with 1.1 percent users.. Bangladesh also ranked 138 with 0.3 percent fixed broadband penetration compared to Cambodia’s 0.2 percent penetration and 143rd position worldwide. In mobile broadband, Bangladesh has secured the 137th position with 0.2 percent penetration outranking Thailand with 0.1 percent penetration and a rank of 140.

Pay Dispute Hits Bangladesh's Clothing Industry(The Wall Street Journal, September 22, 2013)
Tensions rose in Bangladesh's garment industry over the weekend as factory owners and workers squared off over a new minimum wage for the South Asian country's largest export industry. Tens of thousands of garment workers took to the streets in the capital of Dhaka on Saturday, demanding the government set minimum monthly pay at 8,000 taka, or about $100. The factory-owners' association said a higher minimum wage could cripple the industry as costs of other inputs to clothing production are also rising. The minimum wage was fixed at 3,000 taka a month in 2010. Labour groups are now demanding a big increase to offset the impact of a high inflation rate that has often climbed above 10% in Bangladesh.

Bangladesh top achiever along with Cambodia (The Daily Star, September 22, 2013)
Bangladesh and Cambodia have topped the chart of the least developed countries in achieving Millennium Developed Goals. According to a new study, the first of its kind, by the Centre for Policy Dialogue, both the countries were likely to meet eight out of 14 targets under review, while they made progress in four other areas. It was conducted by CPD Distinguished Fellow Debapriya Bhattacharya and his three researcher colleagues Towfiqul Islam Khan, Umme Salma and Gazi Joki Uddin. Bhutan came in third while Rwanda stood fourth.

Yet another high-rise car park in Dhaka (The Daily Star, September 22, 2013)
Rajdhani Unnayan Kartripakkha (Rajuk) has opened another multi-storey car park with a capacity of parking 228 vehicles in efforts to ease the traffic congestion in at Gulshan. Rajuk has developed the facility comprised of two basements and first seven floors of a 14-storey commercial building. It has constructed the building at a cost of Tk 39 crore on a 19.5-katha land in front of the city corporation market at Gushan-1 over a period of six years since December 2007. The top seven floors will be rented out for office and other commercial occupancy. There will be seven shops on the ground floor and a Rajuk office on the second floor. Out of a total of 1,39,260 square-foot floor area, 98,935 square feet will be allocated for car parking, and 40,325 square feet for office. There are three car lifts to travel between 3rd and 7th floors.

Airlines plan big (The Daily Star, September 21, 2013)
The aviation industry is likely to see an unprecedented boom as both the public and private airlines are expected to invest around $1 billion in the sector by next year. National carrier Biman plans to acquire eight aircraft, Regent Airways five, NOVOAIR four, United Airways three and US-Bangla Airlines at least two. This investment is aimed to tap around 10 percent annual growth of passengers and eight percent that of cargo over the next seven years, as the Bangladesh economy is marking a steady growth of over six percent, said executives of the Civil Aviation Authority of Bangladesh (Caab) and different airlines.

Complaints pile against three state banks (The Daily Star, September 21, 2013)
Bangladesh Bank (BB) has received the highest number of complaints against state-owned Sonali, Janata and Bangladesh Krishi banks in fiscal 2012-13. Most of the complaints are tied to inability to pay the bills of Hall-Mark Group by Sonali Bank. According to Bangladesh Bank, over 30 banks have around Tk 1,300 crore stuck in Sonali Bank. In fiscal 2012-13, the financial integrity and customer services department of BB received a total of 4,296 complaints from customers, of which only 68.45 percent, have been settled so far.

BPC suspends fuel import, bill payment (The Financial Express, September 20, 2013)
The state-owned Bangladesh Petroleum Corporation (BPC) has suspended import of fuel from international market and payment of bills against imports in protest of a legal action by Anti-Corruption Commission (ACC) against some BPC officials. A senior BPC official said that the BPC officials have stopped opening letters of credit (L/Cs), providing payment advices to commercial banks concerned and clearing payments against fuel imports.

Weekly News Clippings (September 19, 2013)

Price rockets due to trading racket (The Daily Star, September 19, 2013)
The steep rise in onion prices is not just due to a supply cut from India, but also an artificial supply shortage created by a band of traders. According to a study conducted by International Food Policy Research Institute, a food policy research think tank, the market supply of onions in Bangladesh declined not only because of the reduction in imports from India, but also due to local traders taking advantage of the situation by cutting the supplies of their stored onions to the market in order to make extra profits. The study has been made public at a time when prices of onions rose after a brief respite for a couple of weeks.

Bangladeshi RMG still yields more profit to retailers (The Financial Express, September 18, 2013)
Bangladesh still remains the most profitable place for global retailers of readymade garments. According to a study conducted by McKinsey & Co, a leading New York-based business consulting firm, the country attracts retailers due to a large number of garment factories and low minimum wages in spite of the occurrence of repetitive industrial disasters than any other garment-producing country. Eighty per cent of the retailers participating in the survey plan to reduce sourcing from China over the next five years, primarily because of rising labour costs. The $20 billion garment business of the country has sped past rivals such as Vietnam and Cambodia.

FBCCI seeks duty-free benefits from Russia(The Daily Star, September 18, 2013)
The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) have requested the Russian government to grant duty-free market benefits to Bangladeshi products. The president of FBCCI encouraged the Russian entrepreneurs to invest in power generation, gas, mining, agro-processing, leather goods, electrical and electronics, engineering industries, pharmaceuticals and agricultural machinery. The present trade volume between the two countries is around $543.59 million, with the balance of trade being in favour of Russia. In fiscal 2012-13, the country’s import from Russia stood at $335.30 million against the export of $208.29 million.

North American alliance agrees to follow national building code (The Daily Star, September 17, 2013)
The Alliance for Bangladesh Worker Safety, a coalition of 22 North American retailers to improve factory conditions in Bangladesh, has agreed to follow the Bangladesh National Building Code in its garment factory inspections. The alliance has prepared a common set of fire and building safety standards for garment factories in Bangladesh by working with experts. The standards not only align with the Bangladesh National Building Code but also support the National Tripartite Plan of Action.

NBR salutes top taxpayers(The Daily Star, September 16, 2013)
The National Board of Revenue on Sunday rewarded 403 income taxpayers from across the country in recognition to their contributions as the highest and long-time taxpayers. The NBR handed over tax cards, crests and certificates to the taxpayers at seven different programmes in divisional headquarters organised on the occasion of the National Income Tax Day-2013.

Remittances dip in Bangladesh, strain economy(Times of Oman, September 15, 2013)
Due to the fall in the number of Bangladeshis workers going abroad there has been a sizeable dip in inward remittances. According to the economists, the ongoing tension in the Middle East played a major role behind it. The aggregate remittance earnings during the April-August 2013 period have dropped by more than $100 million from the corresponding period last year. If the downtrend persists, it might destabilize the balance of payments situation and pose a threat to the country's existing foreign exchange reserves.

Doing Business in Bangladesh(The New York Times, September 14, 2013)
Owners of clothing factories in Dhaka, Bangladesh had a candid conversation with a New York Times correspondent after a meeting with clothing industry executives, labor activists and American and European government officials at New York University last week. According to them one of the major problems includes huge orders by stores like Wal-Mart which exceed the capacity of the factory which is why a need arises for sending some of the work to smaller producers, “unofficially”. This is called unauthorized subcontracting to smaller, uninspected factories. It is a primary reason safety guidelines that apply to bigger contractors have not prevented the hundreds of worker deaths in fires and building collapses in facilities like Rana Plaza, which crumbled last April killing 1,129 people. The factory owners admitted that what they were doing was wrong. But they said Western clothing companies were also culpable because they often award contracts to manufacturers that they know do not have enough machines and employees to do the job.

UK safety experts visit Bangladesh(Independent. ie, September 14, 2013)
A team of three, two from the Royal Institute of Chartered Surveyors and one from the Better Regulation Delivery Office, will be coming to Bangladesh to advise the country’s building regulations agency on how to tighten up its inspections regime. The visit follows the collapse of the Rana Plaza building in Dhaka earlier this year.

Tesco team due Sunday(The Daily Star, September 13, 2013)
A team from the British retail giant Tesco is due in Bangladesh on September 15, aiming to expand its customer base in the country. According to a Tesco spokes person, the company’s group commercial director will be in Bangladesh next week to meet with a range of local suppliers. Industry insiders said the high-level Tesco team will also visit Liberty Fashions, a Savar-based garment factory, from where the company stopped sourcing after its own surveyors detected structural flaws in the design of the factory building.

Retailers divided over Bangladesh factory victims compensation(Reuters, September 12, 2013)
A group of retailers and clothing brands have failed to establish compensation funds for the victims of two Bangladesh factory disasters, as many companies that sourced clothes from the buildings decided not to participate in the process. Only nine out of the 28 brands attended the Geneva meeting, with some of the absentees saying that they preferred to pursue their own compensation plans or citing issues with the approach adopted at the talks. The collapse of Rana Plaza, a factory built on swampy ground about 20 miles outside Bangladesh's capital city Dhaka, ranks among the world's worst industrial accidents and has galvanized brands to try to improve safety standards at suppliers.

Bangladesh orders legal action against Yunus(Las Vegas Sun, September 12, 2013)
The Bangladesh government has ordered legal action against the country's Nobel laureate Muhammad Yunus, accusing him of evading taxes on overseas income received from book royalties, speeches at conferences and numerous awards. Yunus has issued a statement denying the allegations. Yunus was ousted last year as managing director of pioneering small-loan provider Grameen Bank after the High Court ruled the 73-year-old violated retirement laws by serving beyond the age of 60. He won the Nobel peace prize in 2006.











 

Weekly News Clippings (September 12, 2013)

BD on way to becoming world's No 1 denim goods exporter (Financial Express, September 12, 2013)

Bangladesh might become the leading exporter of denim and cotton trousers in the world as the orders of this goods have increased by 25%, after China. According to the industry leaders buyers from EU and US are displaying their eagerness to import the products from Bangladesh. However, to meet the demand of the international buyers, the companies need to double their production capacity, said Bangladesh Textile Mills Association (BTMA) President. Over the last eight months Bangladesh has exported 100 million pairs of jeans to the EU and US markets.

Hindrance to low-cost housing (The Daily Star, September 12, 2013)
Rising prices of land and construction materials is the major obstacle to providing affordable housing in Dhaka. Over the last 13 years, the average land value has increased around 13-fold and prices of major construction materials such as rod and cement rose up to three-fold, said Toufiq M Seraj, managing director of Sheltech (Pvt) Ltd, a real estate company. Apart from the price factor, the number of real estate companies have also increased leading to shrinking profits. Dhaka is now accommodating over 600,000 people per year. More than 120,000 household units are required to house the extra population in Dhaka.

Export growth drops as apparel shipments fall (Financial Express, September 11, 2013)
The export in merchandise sector has declined due to the fall of shipment in the apparel sector. Export Promotion Bureau said that export growth in August stood at 3.18%, similar to that of the same month last year.  Earnings from knitwear items have declined from the target to 5.69%, exports in agricultural products, leather, engineering products, pharmaceuticals registered a growth. Experts implied this as an impact of Rana Plaza.

Corruption returns as main hurdles to business: study  (The Daily Star, September 10, 2013)
Though Bangladesh has climbed up eight notches to 110th place among 148 nations in the World Economic Forum’s 2013-14 Global Competitiveness Index (GCI), corruption has also increased. The GCI Report stated that corruption is the main deterrent to doing business in Bangladesh. The report came out after a survey conducted by the Center for Policy Dialogue based on a questionnaire developed by Geneva-based World Economic Forum. The survey found that besides corruption, lack of infrastructure supply, inadequate bureaucrats of government and political instability are other factors that hinder the growth of a business.

Bangladesh's Grameenphone to invest in 3G (Boston Herald, September 10, 2013)
Bangladesh's largest mobile phone company is ready to invest millions of dollars to prepare for 3G operations after gaining spectrum in the country's first open 3G auction. On Sunday, Grameenphone Ltd. won 10 megahertz of spectrum with a bid of $21 million for each megahertz. Three other private companies — Banglalink, the local subsidiary of Egypt's Orascom Telecom; Robi, a joint venture between Malaysia's Axiata Group and Japan's NTT DoCoMo; and Airtel, majority-owned by India's Bharti Airtel — also won bids for 5 megahertz of spectrum each at a price of $105 million. Grameenphone, a subsidiary of Norwegian telecom giant Telenor ASA, has 44 million subscribers and a 42 percent market share.

Bangladesh To Pursue Legal Action Against Grameen's Founder Yunus (The Wall Street Journal, September 9, 2013)Bangladesh's government on Monday instructed authorities to pursue legal action against the Nobel Prize-winning founder of Grameen Bank for alleged tax evasion. The decision to move against Muhammad Yunus, former managing director of Grameen, a microlending pioneer credited with helping many rural Bangladeshis escape poverty, was taken at a cabinet meeting headed by Prime Minister Sheikh Hasina. The decision may have been triggered by a long-running apparent political feud between the prime minister and Prof Yunus.

Bangladesh e-commerce fair starts in London (The Daily Star, September 8, 2013)
The first UK-Bangladesh e-commerce fair took place in London last weekend with many major e-commerce-related organisations from both the countries showcasing their products and services.
The fair gave the participants an opportunity to familiarise and integrate with the fastest growing business form in the world. Services such as money transfer, donations and buying greetings cards are now only a click away from the comfort of people’s homes due to the opportunity of e-commerce.
The fair took place at Gloucester Millennium Hotel, South West London, from September 7-9.

Hotel chains eye Bangladesh market (The Dhaka Tribune, September 7, 2013)
A number of international hotel chains such as Marriott International, Sheraton, Westin, Novotel and Hilton will open their branches in Bangladesh within the next 2-3 years. Of them, Le Meridien, now under construction at the capital’s Nikunjo along the Airport road, was scheduled to open in July. Best Holdings Ltd, a local concern of Metro Group, is constructing the building with 304 rooms. Frequent visits by increased number of the foreign businessmen coupled with hosting of international sports events has increased the demand for luxury hotels. Bangladesh now has four five-star hotels with a total of nearly 1,000 luxury rooms. The annual occupancy rate on an average is 55-60%, said the industry insiders.

Bangladesh Has 1 Million Solar Systems, Aiming For 5 Million by 2015 (The 9 Billion, September 5, 2013)
Bangladesh, in a matter of months will reach the substantial milestone of having one million solar systems installed. Grameen Shakti is currently installing about a thousand new home solar systems per day, and 80 percent of these are in rural areas with an aim to have as many as five million systems installed by 2015. The company has made it possible for people to afford solar power by tailoring it to what people require and can afford in their particular situation. Often the minimum requirement for electricity is low, and the company provides loans to enable the people to repay easily.