Weekly News Clippings (May 15, 2014)

Bad governance holds the country back (The Daily Star, May 15, 2014)
A lack of good governance from budget formulation to implementation is holding back Bangladesh from achieving higher levels of economic growth. According to speakers at a pre-budget discussion, the economy will continue to grow by 5 percent even if the government “falls asleep”, given the strong level of remittance and agricultural production, garment-dominated exports and women participation in rural economy. The discussion was organised by the Institute of Chartered Accountants of Bangladesh and the Prothom Alo, a leading Bangla newspaper. The speakers also suggested a massive reform in the budget system, which has been in practice for more than 40 years.

Mobile operators demand further cuts in SIM card duty (New Age, May 15, 2014)

Mobile operators have urged the government to reduce corporate tax by 10 percentage points to 30 percent for listed and 35 percent for non-listed operators. They also urged the government to eliminate the Tk300 SIM tax, which was supposed to be paid by customers but is paid by the operators. The corporate tax rate for general listed companies is 27.5 percent and for the non-listed ones 37.5 percent. Association of Mobile Telecom Operators of Bangladesh organised a press briefing at Sonargaon Hotel in Dhaka to share the operators' budget proposals. Mahtab Uddin Ahmed, chief operating officer of Robi, said Bangladesh has the highest corporate tax levels for the mobile sector; it is 35 percent in Pakistan and Sri Lanka, 33 percent in India, 30 percent in Thailand and 25 percent in China. 

Bangladesh tea prices up on arrival of quality leaf (Reuters, May 14, 2014)

Tea prices in Bangladesh rose on Wednesday at the first auction of the new season, on arrival of fresh and good quality leaf, brokers said.  Demand was good for good quality tea and major buyers were back to the market on the arrival of fresh leaf at the first auction of the new season. Bangladeshi tea fetched an average of 194.27 taka ($2.5) per kg at the auction, up from 68.03 taka at the previous sale after the auction season, typically to end-March, had been extended through April, an official from National Brokers Limited said.  Sales volume also rose this week although a good quantity of tea remained unsold, he added. 

Leather industry hits record exports: $1b (The Daily Star, May 14, 2014)

Leather businessmen are now confident of meeting the export target of $1.21 billion set by the government for this year. Between July and April, the leather industry exported $1.06 billion of products, whereas the exports receipts for the whole of fiscal 2012-13 stood at $980.67 million, according to data from the Export Promotion Bureau.  M Abu Taher, chairman of Bangladesh Finished Leather, Leather goods and Footwear Exporters' Association, said many buyers are diverting orders from China, where the production cost has increased significantly. Taher said the sector will be able to earn as much as $2 billion next fiscal year if the present trend continues.

Bangladesh’s garment exports grow 15.38% in July-April (fibre2fashion.com, May 13, 2014)

The exports of readymade garments from Bangladesh increased by 15.38 percent to US$ 19.97 billion during the first ten months of the ongoing fiscal year 2013-14, as against exports of $17.307 billion made during the corresponding period of the previous fiscal, as per the latest data released by the Export Promotion Bureau (EPB). The 15.38 percent growth in clothing exports was greater than the 13.18 percent growth registered in overall exports from Bangladesh during the period under review.

London tops super-rich city list : Survey (The Financial Express, May 12, 2014)

 London has more billionaires than any other city in the world, and Britain has more billionaires per head of population than any other country, new data showed on Saturday. London is home to 72 of Britain's 104 sterling billionaires, well ahead of Moscow in second place with 48 people worth the equivalent of 1 billion pounds or more. New York is in third place with 43 billionaires, San Francisco in fourth place with 42, Los Angeles next with 38 and Hong Kong in sixth place with 34.

Why Green Jobs Are Booming in Bangladesh (The Altantic, May 12, 2014)

Bangladesh has become a top hot spot for renewable energy jobs, creating a green workforce as large as Spain’s in 2013. Bangladeshi’s are installing small photovoltaic systems at a rate of 80,000 a month, says the report from the International Renewable Energy Agency (IRENA). In a country where only 47 percent of the population had access to electricity in 2009, according to the Asian Development Bank, solar is increasingly becoming a way to leapfrog the need to build a bigger power grid. In the past 10 years, the number of solar systems in Bangladesh has jumped from 25,000 to 2.8 million, according to IRENA. That in turn has created some 114,000 jobs. Solar energy accounted for 2.3 million of the world’s 6.5 million renewable energy-related jobs in 2013, according to the report.

World Bank approves $60m for VAT reforms (The Daily Star, May 11, 2014)

The World Bank has approved $60 million (about Tk 470 crore) in interest-free credit to help modernise Bangladesh's value added tax (VAT) administration and increase tax revenue. The credit has been offered under a VAT improvement programme that will increase the number of active registered VAT-payers to 85,000 within the next five years compared to around 35,000 now. The project will introduce automation, including online VAT taxpayer services, and improve transparency in the VAT administration system.

176 garment factories closed in post-Rana period (The Financial Express, May 11, 2014)

The Bangladesh Garment Manufacturers and Exporters Association have confirmed that over 176 factories producing garments in Bangladesh have closed since the Rana Plaza disaster in April 2013. Shahidullah Azim, vice-president of the BGMEA, said the reasons for the shutdowns include compliance issues, western retailer audits, higher wages and political disruptions. Many buyers are also “no longer placing orders in units located in shared or rented buildings”, and that some owners willingly closed their factories because they could no longer afford to run them.

11 items picked for expansion of export (Dhaka Tribune, May 11, 2014)

The government has taken a set of measures to diversify exports with a special focus on 11 manufactured products, including pharmaceuticals, furniture, rubber, ICT, frozen food, electric home appliance, home textile, jute and jute goods, printed and packaging material, among others. “Policy supports and cash incentives will be given to these 11 products to boost export earnings,” said a commerce ministry official. He said steps will also be taken to help maintain quality and compliance in line with the international standard, and to increase productivity.

Bangladesh, India strike electricity corridor deal (Khabar South Asia, May 10, 2014)

The Bangladeshi and Indian governments tentatively struck a power cooperation deal for 2017 that would allow India to transmit electricity from its northeastern states to Bihar through Bangladesh territory. In exchange, Bangladesh would get a daily minimum of 500 to 1,000 in additional megawatts. However, the northeast power project will not be economically viable unless the two countries connect their grids or establish a power corridor in Bangladesh, said Professor Mohammad Tamim, head of the Petroleum and Mineral Resources Engineering Department at the Bangladesh University of Engineering and Technology. While some question whether India would give Bangladesh its due share of electricity, others support the bilateral deal provided it helps Bangladesh meet its chronic energy shortage.

Bangladesh 4th most polluted in world (The Daily Star, May 9, 2014)

Bangladesh has been ranked fourth among 91 countries with worst urban air quality in the latest air pollution monitoring report of World Health Organisation (WHO), while three Bangladeshi cities have been put among the top 25 cities with poorest air. The 2014 version of the Ambient Air Pollution (AAP) database consists mainly of urban air quality data of 1600 cities from 91 countries. In the city-wise assessment, Narayanganj has been marked as the 17th city with worst air quality whereas Gazipur and Dhaka have been ranked 21st and 23rd respectively. In the report, six of the top 10 cities with highest air pollution were from neighbouring India with Delhi taking the first spot.