Weekly News Clippings (December 19, 2013)

Canadian retailers urged to sign RMG safety accord (Reuters, December 19, 2013)
A group that includes Canada’s largest unions is urging Hudson’s Bay Co, Canadian Tire Corp and other Canadian-based retail companies to sign a European-led initiative to improve safety for garment workers in Bangladesh. More than 125 companies, many based in Europe, have already signed the accord. At present, Canada’s largest grocer, Loblaw Co, is the only Canadian signatory of the European-led Accord. Garments sold under Loblaw's Joe Fresh brand were manufactured at the Bangladeshi complex that collapsed in April and killed more than 1,100 workers. The grocer has pledged to pay several months of wages to the workers and families affected by the disaster.

Food stock drops (The Daily Star, December 19, 2013)
The government’s food stock has decreased by about 24 percent over the last three months. Officials apprehend that the stock may fall further if the ongoing political unrest lingers. In the last boro season, the government’s target was to buy 10 lakh tonnes of rice against which 8.3 lakh tonnes were purchased, according to the food ministry. Due to shutdowns and blockades, the farmers are unable to transport their produce, while on the other hand, banks cannot make payment to them due to a cash crunch.

Leather goods, footwear, ceramic exporters to get EDF fund (New Age, December 19, 2013)
The central bank has extended its low-cost Export Development Fund (EDF) facility to the leather and ceramics sectors in a bid to help them tide over the current political situation that has been detrimental to business. Under the EDF, a single party can get a maximum loan of $12 million, with the loans payable upon receipt of export proceeds within 180 days from the date of disbursement. Bangladesh Bank also asked the lenders to be considerate in giving out loans to small and medium enterprises.

Cox’s Bazar tourism goes haywire (The Daily Star, December 18, 2013)
The ongoing political crisis has driven the hospitality industry in Cox’s Bazar to the edge, forcing hoteliers to send many of their employees on leave to minimise losses. Although November to February is the peak season for tourists, the occupancy rate has come down to almost zero, said hoteliers in the town of the world’s longest sea beach. The tourism industry is on the verge of disaster,” said Taufiq Uddin Ahmed, president of Tour Operators Association of Bangladesh. The occupancy rate has come down to 5-7 percent now though the rate should have been around 80-90 percent now, said the chief executive officer of Seagull Hotel. We have already sent one-third of our 280 staffs on leave to bring down the losses,” he said, adding that they will be forced to close the business if the current situation continues for another two or three months.

Superstores bleed over political chaos (The Daily Star, December 18, 2013)
Superstores are in distress as the frequent strikes and blockades are taking a toll on the business. According to the general secretary of Bangladesh Supermarket Owners’ Association, the overall superstore sales dropped significantly with even a steeper fall of 95 percent for small chain stores. Shaheen Khan, chief operating officer of Meena Bazar said that they are losing 30-40 percent of sales every day due to the unrest. Meena Bazar that operates eighteen outlets across Bangladesh and sources vegetables directly from farmers are facing a challenge in maintaining the supply of perishable goods due to the frequent blockades and strikes.

Near collapse for railway (The Daily Star, December 17, 2013)
Repeated attacks on railway infrastructures during hartals and blockades have pushed rail communications to the verge of collapse as the revenue earnings have dropped dramatically. On a usual day, railway earns around Tk 63 lakh by carrying 45,000 passengers in Dhaka division alone but it has declined to Tk 35 lakh as the number of passengers has fallen to 23,000. Official records show that at least 288 attacks were made on trains during the 16 days of blockades and hartals enforced by the opposition alliance between November 26 and December 16, derailing nine trains. Three passengers were killed while several hundred were injured.

Rajuk move to limit consulting firms to create monopoly (Financial Express, December 17, 2013)
Rajuk plans to engage a limited number of selected firms for providing building designs to the people by curbing thousands of existing professional engineers and architects' businesses sources said. According to the sources if Rajuk finally implements the new procedure people would be restricted in their choice for getting building designs. Currently more than 10,000 professional architects and engineers are engaged in giving designs in building structure, architecture, plumbing, electromechanical, fire and in other areas. Most of them are registered by Bangladesh Professional Engineers Registration Board (BPERB) and they are much more qualified to provide services, the source said. However, Rajuk said that they have planned to provide registration to some eligible firms for providing building designs to avoid accidents.

Blockade hits Bangladesh as economy suffers (Gulf Times, December 17, 2013)
Strikes and blockades have shuttered industries and halted transport for almost a month since the start of November. This has cost the economy more than $4 billion, according to three leading trade groups. The garment industry, the driving force of the economy has been hard hit as some Western customers are rumoured to be moving elsewhere. Farmers nationwide have been forced to dump milk and produce that has been left rotting, with lorries unable to move them to towns and cities for sale, industry groups say.

Businessmen protest at political violence (New Age, December 16, 2013)
In a desperate move to stay afloat, the business community of Bangladesh held white-flag rallies across the country on December 15, demanding a peaceful end to the ongoing political crisis . The Federation of the Bangladesh Chambers of Commerce and Industry (FBCCI) office called the countrywide programme to protest against the current political impasse and the mounting losses due to continuous agitation by the opposition alliance.

Pharma sector struck by political unrest (The Daily Star, December 16, 2013)
The pharmaceutical sector has incurred losses of around Tk 1,000 crore over the last two months due to political unrest, which has almost broken down the supply chain. According to Momenul Haq, senior vice-president of Bangladesh Association of Pharmaceutical Industries, the supply shortage has started to reflect in the prices in rural areas, which are difficult to reach during shutdowns and blockades. On the other hand, medicine manufacturers are struggling to bring in raw materials from the Chittagong port due to arson on the highways, he said. At present, the pharmaceutical industry consists of 250 companies which meet 97 percent of the local demand and exports to more than 88 countries.

BGMEA to form company for industrial park (Dhaka Tribune, December 15, 2013)
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) will form a company by this month to establish an industrial park at Bausia in Munshiganj for the country’s apparel makers. The industrial park will be established on 532 acres of land, of which 30% will be used for infrastructural development and the rest for factories. The park will have facilities such as power station, fire brigade, child care, police station, bank, river port, pump house, solid wastage pump, central effluent treatment plant (CETP) and dumping yard. The BGMEA president said that they have received over 1,700 applications from the garment makers against 432 units to be allocated in the proposed park.

Govt assessing production, demand of 20 major essential items(The Financial Express, December 14, 2013)
The government has started a process of assessing production and demand of 20 major essential items to help check their untoward supply crisis and price spiral in the domestic market, official sources said. The Ministry of Commerce (MoC) has advised the Ministry of Agriculture (MoA) to provide information about the total production and demand of 20 commodities including rice, sugar, edible oil, pulses, onion, garlic, ginger, dry chilly, turmeric and various spices in the country.

Transport owners count huge losses (The Daily Star, December 13, 2013)
Political violence has taken a heavy toll on the road transport sector, with around 3,000 vehicles vandalised and 1,000 burnt in the last one and a half years. Between June 2012 and December 8 this year, at least 42 drivers, helpers and conductors of vehicles such as bus, minibus, truck and CNG-run auto rickshaw were killed in violence, mainly arson attacks while 500 were injured. The transport sector suffered a loss of around Tk 4,200 crore during the period, according to Bangladesh Sarak Paribahan Sramik Federation, a platform of transport workers. Around seven million transport workers, who earn Tk 500 to Tk 1,200 each on usual days, remain jobless during blockades or shutdowns, said Osman Ali, general secretary of the platform.






   

Weekly News Clippings (December 12, 2013)

Business leaders to hoist white flags with calls for political peace (The Daily Star, December 12, 2013)
The business community will take to the streets across Bangladesh for half an hour on Sunday, protesting the political trouble that is ruining the economy. They will stand on the roads in front of all district chambers and associations, shop owners’ association and business houses from 11:30 am to 12 noon, carrying white flags, to demand an end to the ongoing instability and seek a business friendly environment. Top leaders of the Federation of Bangladesh Chambers of Commerce and Industry, Bangladesh Garment Manufacturers and Exporters Association, Bangladesh Textile Mills Association and Bangladesh Chamber of Industries, and Bangladesh Knitwear Manufacturers and Exporters Association called for the programme. This will be the second time in two weeks that the businesspeople are taking to the streets since December 7.


Over 300 realtors in business sans Rajuk permission (Financial Express, December 11, 2013)
More than 300 developers and housing companies are engaged in real estate business without any valid permission from the Rajdhani Unnayan Kartripakkha (Rajuk), which is resulting in more people being cheated while buying land. As per the existing provision, any land development and housing company is required to register with the Rajuk, the development authority of the capital city of Dhaka, before doing any real estate business in areas under the city.  According to official sources, more than 313 companies are involved in land business, of which only 13 companies have got the final approval from the Rajuk on 28 of their housing schemes.


Apartment sales drop by half on political unrest (The Daily Star, December 10, 2013)
Apartment sales fell by a half in recent times due to the ongoing political turbulence, creating a cash crunch in the housing sector. According to realtors, most construction projects have been kept on hold as the developers cannot bring raw materials due to blockades. “We have been hit hard by the political unrest. Our transactions have reached a record low,” said M Wahiduzzaman, general secretary of Real Estate and Housing Association of Bangladesh (REHAB).


BD at risk of losing EU fresh produce market  (Financial Express, December 10, 2013)
The UK-based organisation GM Freeze (GMF) has called upon Bangladesh government to review its decision on commercialization of genetically modified crops to protect local farmers and exporters from the risk of losing their business. GMF said the UK imports some 40 per cent of Bangladesh's fresh produce exports, worth around US$31.18 million per year. GMF has urged the President, Prime Minister, and ministers for commerce and environment, to revert the decision of commercializing GM brinjal (aubergine) to protect Bangladeshi farmers and exporters from the serious risk of losing their business at the EU market. GMF is a campaign on GM foods, crops and patents. Its web-portal is widely acceptable to the businesses in the UK and elsewhere in the globe.  


WTO adopts historic trade reform deal (Dhaka Tribune, December 8, 2013)
The world Trade Organisation (WTO) has adopted its first ever trade reform deal in a historic move concluded in Bali, Indonesia with Bangladesh reaping its desired outcome for a greater duty-free and quota-free market access in the developed and developing countries. The objectives of the deal is to slash red tape at customs around the world, give improved terms of trade to the poorest countries, and allow developing countries to skirt the normal rules on farm subsidies if they are trying to feed the poor, WTO said, releasing the draft on the last day of the four-day meeting.

Bangladesh's CPI ranking improves but only slightly  (Financial Express, December 6, 2013)
Bangladesh has improved its ranking on the Corruption Perception Index (CPI) as introduced by the Berlin-based Transparency International (TI) by just one point compared to that of last year. It has been placed in the 136th position this time. Among 177 countries covered by the TI, Bangladesh finds itself in the 16th slot from the bottom bracketed with Ivory Coast, Guyana and Kenya. The extent of corruption prevalent in a country is dependent primarily on the lack of good governance. And surprisingly no country in the world could score 100 out of 100 on a scale of 0-100. This year Denmark and New Zealand jointly score the highest 91 to grab the number one slot. From Asia, Singapore occupies the 5th place with a score of 86.

Weekly News Clippings (December 5, 2013)

EU warns Bangladesh of compliance (Dhaka Tribune, December 5, 2013)
Serious trade actions will be taken if labour rights and workplace safety are not improved substantially warned Karel De Gucht, European trade commissioner. “Everything should be put in place for continuation of duty-free facility to the EU. If nothing substantial is achieved, Bangladesh will have serious problems with the EU,” he said, while indicating that the implications will be more serious than the US’s suspension of generalised system of preferences (GSP) scheme. At present, Bangladesh is among the least-developed nations that enjoys duty-free and quota-free access to the European Union under the “Everything but Arms” scheme.

BD makes 'insignificant' progress in graft index (The Financial Express, December 4, 2013)
Bangladesh has been ranked 16th from the bottom in the global corruption perceptions index, taking three steps forward from its last year's position. However, according to Transparency International Bangladesh (TIB) the improvement is insignificant as the large scale corruption issues like the Padma Bridge, railway scandal, Hall-Mark, Destiny and the Rana Plaza collapse have overshadowed Bangladesh's profile in the index. Afghanistan is the only country that stood below Bangladesh in the South Asian region while Pakistan, Nepal, India, Sri Lanka and Bhutan managed to score 28, 31, 36, 37 and 63 respectively.


bKash eyes to be the largest m-banking service provider co in the world(The Financial Express, December 4, 2013)
bKash Limited is looking to become the largest mobile banking service provider company in the world within the next few years said Rumee Ali, chairman of bKash. Ali expects to achieve nearly 15 million bKash accounts at the end of 2014 by exploiting the huge business-expansion opportunity in Bangladesh having over 110 million cell phone users, and 60 per cent unbanked people out of 160 million population. With 76,000 agents and 180 distributors, bKash accounts now stand around 8 million across the country.

Coca-Cola offers Tabani $16m to end bottling deal (The Daily Star, December 3, 2013)
Coca-Cola has agreed to pay $16 million to Tabani Beverage to end a decade-old bottling agreement with the state-run company. Coca-Cola made the offer after a government panel suggested closing the deal upon the payment of the sum which Tabani will use to clear its liabilities. The liberation war affairs ministry, the owner of Tabani, last week sent a proposal to the Cabinet Committee on Economic Affairs in this regard. Finance Minister AMA Muhith has also given his consent to the move, which will clear ways for the soft drink maker to invest $50 million to set up a manufacturing plant in Bangladesh, according to the proposal. Coca-Cola Far East Ltd markets Coke products in Dhaka and Rajshahi by bottling through Pran, while Abdul Monem Ltd, another bottler of Coca-Cola, distributes the products in other parts of the country.


SR Asia conference seeks steps to deal with hazardous sectors (Financial Express, December 2, 2013)
The SR Asia 2nd International Conference on "Responsible Business Conduct to Safeguard the People's Issues and Environment by Managing Hazardous Waste" was held in the city on November 29 and 30. This year Bangladesh hosted the 2013 International Conference, which was jointly organised by the CIRDAP and the Bangladesh Bank Training Academy. Other partners include GIZ, Swisscontact, APO, IPLA, E&Y, Islami Bank Bangladesh Ltd. and a few others, according to a press statement by the SR Asia. The aims and objectives of the conference is how waste is being handled in the developing countries.


Bangladesh remittances dip for fourth month in a row (Reuters, December 2, 2013)
Money sent home by Bangladeshis working overseas has dropped nearly 5 percent slipping for the fourth straight month. Millions of expatriate Bangladeshis remitted $5.55 billion from July to November, the first five months of the current financial year, down 9 percent from the same period in the previous year. Good inflow of remittances in recent years have helped build foreign exchange reserves to more than $17 billion. Remittances from about 9 million citizens abroad are critical for the impoverished nation and are a key source of foreign exchange alongside garments, which account for 80 percent of total export earnings of around $27 billion a year. Economic growth is expected to slow down as political uncertainty and turmoil ahead of elections set for Jan. 5 take their toll.



Will Bangladesh Ever Have a Future? (Bloomberg, December 2, 2013)
Pankaj Mishra, the author of "Temptations of the West: How to be Modern in India, Pakistan, Tibet and Beyond," and a contributor to the New York Review of Books, the New Yorker, the Guardian and the London Review of Books delves into the past and present of the world’s seventh-most-populous country. Mishra, also a regular commentator on the BBC, weighs on the pros and cons and envisages how the future of Bangladesh “dominated by the fractiousness of the country’s main leaders” will be despite “the slavery-like conditions of the country’s garment industry”.


Bangladesh’s garment factories still aren’t safe (Business Mirror, December 1, 2013)
John A. Quelch, a professor of business administration at Harvard Business School goes out on a limb to voice his opinion in contrary to the popular perception that Western governments and international organizations can exert little influence on the Bangladeshi government or companies. According to Quelch, only “two forces can improve workplace conditions: pressure by consumers of Bangladesh-made garments and the responsibility that companies placing orders on Bangladeshi factories may feel because of the efforts of consumers and employees.”


Bangladesh factory burned down by angry workers (CBC News, November 29, 2013)
A huge fire on Friday destroyed a Bangladesh garment factory supplying key Western brands such as WalMart, Gap Inc etc, in a blaze touched off by workers angered over rumours of a colleague's death in police firing. Garments are a vital sector for the South Asian nation, whose low wages and duty-free access to Western markets have helped make it the world's second-largest apparel exporter after China. There were no initial reports of casualties in Friday's fire, which gutted a ten-storey building at Gazipur, 40 km from the capital, Dhaka. As many as 18,000 people worked at the factory but they had left the building by 11 p.m., shortly before the fire started. The factory was among the ten biggest in the country.


Bangladesh concludes fuel term deals at mostly unchanged premiums (Reuters, November 28, 2013)
State-owned Bangladesh Petroleum Corporation (BPC) has concluded first-half 2014 term negotiations with nine companies for oil products at mostly unchanged current premiums. Premiums will be unchanged for all oil products except fuel oil. BPC finalised its gasoil contract for the first half of 2014 at a premium of $4.80 per barrel over Middle East quotes, while the term contract for jet fuel has been fixed at a premium of $5.80 per barrel, remaining unchanged from July-December deals. Suppliers for Bangladesh's middle distillates contracts are Kuwait Petroleum Corp (KPC), Malaysia's Petronas, Egypt's Middle East Oil Refinery, Emirates National Oil Company (ENOC), Philippines National Oil Company among others.