Tuesday, May 10, 2022
AMBASSADOR HAAS’ REMARKS TO THE USA-BANGLADESH BUSINESS FORUM
As the United States and Bangladesh celebrate 50 years of diplomatic relations, I am excited for the future. And as I’ve said before, the United States stands ready to move as fast as Bangladesh to deepen and broaden our bilateral relationship.
This evening, I am particularly pleased to welcome the members of the US-Bangladesh Business Council. They are, I am sure, equally willing to move as fast as Bangladesh to develop their trade and investment ties.
Indeed, of all the areas of bilateral cooperation, I am convinced that it is on economic issues that we can go the furthest and the fastest.
It’s not just talking. As a testament to the importance we place on growing our trade and investment relationships, the U.S. Embassy will welcome the first-ever full-time U.S. Department of Commerce Attaché this summer. This step, frankly long overdue, will provide a direct link between American and Bangladeshi companies.
In addition, we look forward to welcoming the Prime Minister’s Investment and Private Sector Advisor, Salman F. Rahman, and his delegation to the United States next month for the High-Level Economic Forum. There, the United States and Bangladesh will discuss trade and investment opportunities in a number of sectors.
In short, together, we have the foundations on which to extend our economic relations. But to take things to the next level, two things need to happen. First, American businesses and investors need to become more aware of the opportunities Bangladesh presents. Second, Bangladesh must be ready for American companies to come here.
I doubt this will shock any of you. But most American business leaders don’t wake up in the morning thinking, “Hmmm, maybe I should do business in Bangladesh.” They usually have their hands full to follow the US market. And if they’re operating globally, they’re probably operating in well-understood markets. They just don’t know Bangladesh. But as the more than 50 companies that have joined the US-Bangladesh Business Council know, there are good reasons to look to Bangladesh for market opportunities. And Bangladesh deserves their attention. Why?
First, Bangladesh has a great macroeconomic history. It has been one of the fastest growing economies in the world over the past decade. Its GDP has grown even during the COVID-19 shutdowns, and the economy is expected to grow 6.9% this year and 7.3% next year. The country’s financial leaders have managed its debt well and have set aside large foreign exchange reserves to help weather the shocks.
Second, Bangladesh has a huge and increasingly middle-class population. From being one of the poorest nations on the planet in 1971, it will graduate from the UN list of least developed countries in 2026. It now has a higher GDP per capita than India. And as the eighth most populous country in the world with 165 million people, it has more than twice the population of the UK and four times that of Canada. Any business that can position itself in Bangladesh now has guaranteed returns for a generation.
Third, an enthusiastic and willing workforce. Bangladesh is poised to reap its demographic dividend. Its workforce is young and increasingly well-educated. Members of the Business Council will have seen every street in Dhaka over the past three days and will know that it is in full economic turmoil. This buzz extends to factory floors and office corridors. A company that is willing to invest in its workforce – to train it and reward it for its work – will have skilled and enthusiastic workers showing up on its doorstep.
Fourth, Bangladesh is uncharted territory for many American companies. It comes down to a lack of awareness of what Bangladesh has to offer. But it also means that companies that enter the market early and boldly will face far less competition than they would if entering a more mature investment destination.
The companies that form the US-Bangladesh Business Council are clearly aware of what Bangladesh has to offer. The other question is: is Bangladesh ready for them? In other words, is Bangladesh a better place for them to spend their time and resources than other countries in the region or elsewhere in the world? As Bangladesh transitions to middle-income country status, it will find that it has many competitors equally hungry for American business.
A company planning to do business abroad will definitely want to see a developed transportation system, access to electricity and water, and a well-trained workforce. Bangladesh has made great strides in meeting these needs. But a company also wants certainty. A company wants an understood policy framework and consistently enforced laws. A company wants to be sure that its intellectual property will be protected. A company wants to know that in the event of a dispute, it has access to courts capable of settling it quickly and fairly.
How does Bangladesh compare to its competitors when these are the questions asked?
Can Bangladesh honestly say that it is competitive with other countries in terms of the ease and time it takes to ship a container to market?
Can Bangladesh say that it fully understands the impact on business of the proposed regulations? For example, does the Bangladesh Telecommunications Regulatory Commission understand how its proposed online data protection rules will force digital companies to reconsider their investments in Bangladesh?
Can Bangladesh assure investors that the business start-up process is fast and transparent?
Can Bangladesh say it has an adequate legal framework in which businesses can operate when it takes years to schedule a hearing?
These are the questions American companies also ask before deciding to do business in Bangladesh.
While low-cost labor has been responsible for Bangladesh’s growth so far, concerns about working conditions and labor rights will become central to business decisions as you transition to a high-income country. intermediate.
Concerns over labor rights and working conditions cost Bangladesh access to trade benefits from the US Generalized System of Preferences, or GSP, in 2013. The European Union has said the same concerns will determine whether its commercial benefits for Bangladesh will continue after it becomes a middleman. -country of income.
These same concerns are also depriving Bangladesh of a massive source of investment capital from the United States. The US Development Finance Corporation, or DFC, was created by Congress with an investment authority of $60 billion. DFC partners with US companies to develop projects in sectors such as energy, healthcare, critical infrastructure and technology. DFC would be an ideal source of funding for projects in Bangladesh. Unfortunately, as long as Bangladesh is not eligible for GSP, it is not eligible for DFC funding. We hope that Bangladesh will soon make progress on labor rights and workplace safety so that it can qualify for the DFC and attract more US trade and investment.
As I said at the beginning, the United States is ready to move as fast as Bangladesh to deepen our partnership. And I also sincerely believe that we can move faster together in building our trade and investment relationships. This U.S.-Bangladeshi business delegation shows just how much the U.S. private sector is willing to invest its time and energy in Bangladesh.