bangladesh newsflash march issue

Newsflash Bangladesh March 2012

Edition 7

Dhaka City

Embassy of the Kingdom of the Netherlands

Newsflash Bangladesh is a publication composed by the Embassy of the Kingdom of the Netherlands in Dhaka. The newsflash provides an update in terms of imperative economic developments, the most important tenders and a selection of other relevant business news that have to do with Bangladesh. This newsflash is shared with a distinctive group of Dutch businesses with special interests in Bangladesh. It is put together on the basis of publicly available information from various sources such as news articles, press releases, and third party information. The Embassy of the Kingdom of the Netherlands in Dhaka is not responsible for the accuracy of the published information. If you do not wish to receive the Newsflash Bangladesh, or would like to add a person to the distribution list, or if you desire to send your comment, please feel free to send a message to [email protected]

Marco Economic Analysis

Food inflation has slowed to single digits for the first time in 15 months due to bumper harvest and a fall in food prices on the international market. Non-food inflation is still high and has increased over the previous month, according to Bangladesh Bureau of Statistics (BBS) data. According to the Bangladesh Bank, the central bank of Bangladesh, remittances rose 14.58% to $1.13 billion in February from the same time a year ago because of a rise in manpower exports, and easy methods of opening foreign currency accounts. The finance minister has identified shipbuilding, furniture and toy sectors as the future assets that should be given due emphasis apart from conventional sectors like readymade garments, jute and frozen fish.

http://bangladesh.nlembassy.org/


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CPD: Policy mismatch slows investment (Source: Daily Star) Centre for Policy Dialogue (CPD), an important think tank, said the government's macroeconomic management, including the monetary policy stance, slowed investment, which is crucial for higher economic growth. The CPD reviewed four core areas -- the state of public finance, developments in monetary sector, capital market movement and balance of payments -- to trace major changes in the macroeconomic scenario since November last year and found a number of direct and indirect indicators show a slowdown in investment. The CPD criticized the finance ministry and the central bank for taking wrong decisions.

Dutch Companies in Bangladesh

Control Union opens a new office in Bangladesh Control Union, member of the Peterson Control Union Group, is a Dutch draft surveying, inspection and certification company. Worldwide, CU carries out these activities in over

60 countries. They recently opened an office in Bangladesh. The company is registered in Bangladesh as CU Certifications Ltd. CU’s main activities in this country currently comprise the inspection and certification of goods made with sustainable origins, from e.g. textile made with sustainably produced cotton, to tea that is produced using organic production methods in the east of Bangladesh. They are also looking into cargo supervision in ports and factories. Currently, they have 11 employees (office and field staff) as well as some dedicated field personnel. Mark Prosé is the Managing Director of CU Certifications Ltd. Their office is based in Banani, Dhaka. For further information please contact [email protected]

SACO bags first order for Bangladesh SACO Airport Equipment based in Mierlo, The Netherlands has just signed a contract for the supply of an air cargo handling system to MGH Group, a logistics company based in Dhaka. Their very first order from Bangladesh is currently in production and is scheduled for delivery in April with installation and commissioning following in July 2012. The scope of supply includes a lowering workstation, castor decks and elevating truck dock, all suitable for handling 10ft main deck ULD’s (pallets and containers). Also included are two sets of roller

equipment to convert locally available standard flatbed vehicles into air cargo vehicles with rise & sink roller tracks.With the SACO system the client will be able to consolidate and pack goods (mainly textiles) onto IATA standard air cargo pallets in their own warehouse and then transfer these built-up


Mark Prosé , Managing Director, CU Certifications Ltd, Member of Control Union World Group


mailto:[email protected]

pallets by truck directly to the airport for export. Because these air cargo pallets are very large (approx. 2.5 x 3.1 meters) and heavy (max. 6800 kg), it will become quite an exciting new venture for the supply chain infrastructure in Bangladesh. With export volumes predicted to substantially increase in the near future, the handling system can easily be expanded to keep up with this demand. For additional information, please browse the website www.saco.aero or feel free to contact Sales Manager, Hans van Schaik via [email protected]

Good electricity import price set (Source: Daily Star) Bangladesh will start receiving 250 megawatts of electricity from India by June next year at a reasonable price under a purchase agreement signed in New Delhi. Bangladesh would be getting the electricity for Rs 2.80 per unit, which is about Tk 4 per unit. 250MW of electricity will be transmitted to Bangladesh through the Baharampur (India)-Bheramara (Bangladesh) grid.

Bangladesh wins case with the Netherlands support On 14 March 2012, ITLOS (International Tribunal for the Law of the Sea) made an important judgment about the maritime border between Bangladesh and Myanmar. The outcome is that Bangladesh established its sovereign rights to a full 200 nautical mile exclusive economic zone in the Bay of Bengal, and to a substantial share of the "outer continental shelf" beyond 200 nautical miles. This opens up important possibilities for Bangladesh to carry out exploration for oil and gas in several offshore blocks that show enormous potential. The Netherlands was the only country that supported Bangladesh through technical expertise on marine seismic survey, legal assistance and has given €148000 for preparing the Bangladesh claim on the continental shelf and train a pool of Bangladeshi experts. This has actively contributed in winning the case for Bangladesh.

Gas connections to industries to resume from April (Source: Financial Express) The government says it will resume gas connections to industries by April 2012 with augmentation of gas supplies to the national gas grid. Gas connections to industries remained suspended since June 2009 as the natural gas demand outpaced supply and a significant number of the existing consumers were not getting gas at adequate pressure. Natural gas production will increase by around 100 million cubic feet per day (mmcfd) by April, when a number of new gas wells will start production in Fenchuganj and Salda.

Chittagong port turnaround time on the decline (Source: Daily Star) For the last couple of months, the premier seaport has been experiencing low turnaround time, which is the time a ship takes to arrive and leave a port after discharging goods. The turnaround time for all types of ships at Chittagong Port declined sharply to 5.12 days in 2011, the lowest in four years. A fall in such time for container vessels to 3.21 days last year contributed to the overall reduction in turnaround time, a key indicator to measure a port's performance.


Infrastructure

Energy

Oil and Gas



Bangladesh Railway signs €6.6 million deal with Indian firm (Source: Daily Star) Bangladesh Railway inked a €6.6 million deal with Indian company Texmaco Rail and Engineering Ltd to purchase 81 broad-gauge oil tank wagons and three brake vans in 12 months. The wagons and brake vans will be used for carrying aviation fuel and oil to different state-owned and private power plants.

Cox's Bazar airport to be upgraded (Source: Daily Star) The government is set to upgrade Cox's Bazar's domestic airport soon to attract more foreign tourists to the country. The airport in Cox's Bazar has been identified as a priority project and the government is hoping that the airport will turn into a regional hub and attract more tourists to the world's longest sea beach. It also plans to construct a cricket stadium and a golf course for tourists.

Inept contractor fails the project (Source: Daily Star) A soft loan of €8.8 million for a highway expansion project is set to be returned to the Asian Development Bank (ADB) as the authorities failed to widen a vital stretch of the Chittagong and Cox's Bazar highway. The highway-widening project remains in limbo due to the incompetence of its contractor and the government's delay in acquiring land. The ADB had financed repairs and widening of the 26.7km Chittagong-Dohazari Road, which is part of the Chittagong-Cox's Bazar highway and the adjacent 6km Patia bypass. The road is now in a shabby state and the government is locked in a legal battle with the contractor to realize €1.1 million it had given to the firm as mobilization advance.

Luck smiles on cotton farmers in nine districts (Source: Daily Star) Nine districts under Jessore and Kushtia zones see bumper production of cotton this season, much to the happiness of farmers who cultivated the cash crop on more than double areas of land compared to last year's. Favourable weather, use of compost and standard HYV seeds, availability of bank loans, relief from pest attack in this season and rainfall during October and November helped better

growth of cotton this season.

Deshbandhu Group installs modern food grain processing mills (Source: Financial Express) A local corporate house, Deshbandhu Group, has set up the largest rice mills in the Northern part of Bangladesh, in Kurigram to utilize the surplus rice paddy of the region. Deshbandhu Group has installed Swiss-made food grain processing mills at a cost of €5.5 million. The mills will produce 200 tons of rice each day to supply in the country's nearly US$ 15 billion food grain market, the largest market in sizes.

Ban to raise fish fry (Source: Independent) The fishing directorate has put a two-month total ban on fishing in 340 kilometers areas on five major rivers in six districts of the southern region from 1st March to facilitate safe spawning and increase national fishing wealth by saving fish fries. The prohibition is effective from March 1 to April 30 for preventing fishermen from catching fish fry, including jatka (hilsa fry), and aiming to give a boost to fish output for increasing hilsha fish.


Agriculture and Food

Ship Building


New company set up to make hydraulic machinery for vessels (Source: Daily Star) Bangladesh is set to start making hydraulic machinery for vessels, including ships, in a bid to reduce import dependence and to export in future. Local firm Western Fishers Shipyard Ltd (WFSL) and its Danish partners DanSea and AS Scan inked a deal in this regard marking the formation of a joint venture -- Scan Machinery BD Ltd. The new company will make hydraulic machinery ranging from steering gears to winches, net drums, propellers and nozzles.

Khan Brothers opens shipyard in Munshiganj (Source: Daily sun) Khan Brothers Shipbuilding Limited opened the country’s largest shipyard in Munshiganj with the aim to draw 10% of total market share of the global ship-building industry by next 10 years. The shipyard was built at a cost of €16.5 million on a land of more than 200 hectares. The company has already received orders to build two ferries, 17 oil tankers and tourist vessels worth about €27.5 million and is going to sign an agreement with a German leading company for which we will make sea-going vessels worth €100 million.

Bangladesh emerging as hotspot for suit making (Source: Daily Star) Bangladesh is turning into a profitable destination for manufacturing high-end formal suits as foreign investment proposals are coming to the sub-sector, with China losing its competitiveness. The majority of the orders are being shifted from China as it is losing its competitiveness for high cost of production and shortage of workers in the readymade garment sector. The foreign brands are either sourcing the suits, formal jackets and trousers for men and women or establishing joint ventures in Bangladesh to tailor the suits.

Cotton export ban in India may have negative impact on BD textiles (Source: Financial Express) Indian Directorate General of Foreign Trade (DGFT) has imposed ban on cotton export with immediate effect to conserve supplies for local Indian mills. According to the business community of Bangladesh, this ban may have a negative impact on both production and export of local Bangladeshi textiles and readymade garments because India supplies almost 45% of the total cotton demand for Bangladesh.

Large number of knitting, dyeing factories on verge of closure (Source: Financial Express) 150 knitting and dyeing factories across the country are facing closure mainly due to shortage of gas and electricity. Many factories have suffered continuous losses as they could not utilize more than 33% of their total capacity in the last year due to lower pressure of gas and interrupted supply of electricity. Most of the factories are now trying to operate their factories at night rather than operating in day time to avail a slightly better situation of gas and electricity supply.

Money transfer made simpler (Source: Daily Star) Freelancers and IT exporters will now receive their payments from foreign buyers without any hassle, as AlertPay yesterday made foray into


Telecom

Textile

Atiur Rahman, Bangladesh Bank governor, launches Bank Asia's e-wallet service in partnership with AlertPay


Bangladesh by launching online payment service in partnership with Bank Asia Ltd. The tie-up with the Canada-based firm has helped the local bank become Bangladesh's first financial institution to introduce an easy online payment gateway service that analysts say will revolutionize e-commerce in the country.

Mobile phone users hit 1.1m in January (Source: Financial Express) The number of mobile phone subscribers recorded a significant increase of 1.103 million in January last reaching the total to 86.558 million in the country to the delight of cell phone operators. According to the data of the telecom regulator, of the six cell phone operators, Grameenphone added the highest new subscribers, while state owned telecom operator Teletalk was in lowest position. The second market leader is Orascom Telecom Bangladesh Limited; third market operator is Robi Axiata Limited, Indian telecom operator Airtel, rolling as fourth number and country's old mobile operator Citycell is in the fifth position.

Beximco Pharma marks successful phase out of CFCs in medical inhalers (Source: Financial Express) Beximco Pharmaceuticals Ltd, the largest manufacturer of pressurized metered-dose inhalers (pMDIs) in Bangladesh, has formally shut down its chlorofluorocarbon (CFC) based MDI plant. Beximco Pharma is the first company in Bangladesh to manufacture MDIs in 1996 using CFCs. However, CFC gases destroy the earth's protective ozone layer, for which Beximco Pharma proactively converted this facility to produce CFC free inhalers in the year 2011. This was made possible with Beximco Pharma's own technical skills taking financial support from the Multilateral Fund and technical assistance from United Nations Environment Programme (UNEP).

ADP under financial crunch: Tip of an iceberg (Source: Daily Star) The number of projects included in the country's Annual Development Programme (ADP) in FY 2011-1 has rolled into 1,204. This includes 165 projects which have been approved this financial year. It is expected that more projects will get approval in the next few months of the year. Approximately €11 billion will have to be released against projects slated for implementation during this financial year.

NBR forms Integrity Unit to rid corruption (Source: Daily sun) The National Board of Revenue (NBR) has set up an integrity unit in an effort to make its staff accountable to taxpayers and make the organization graft-free. Taxpayers are allegedly discouraged to pay tax due to the corrupt practices of NBR officials for that the main job of this unit will be to ensure honesty, transparency and accountability of NBR. If any taxpayer lodges a complaint with the unit, it will investigate the allegations and recommend necessary measures to the higher authorities.

Stimulus offered to stock losers (Source: Daily Star) Small investors who suffered losses due to the recent stock market slump will get a 50% waiver of interest on loans. The interest to be waived must be accrued within the 2011 calendar year or financial year 2011-


Other News

Pharmaceuticals


12. The government has also decided to give the affected small investors a scope to pay the remaining 50% of the interest through quarterly installments in three years.

Purchase, Installation, Testing & Commissioning of 05 kw FM Transmitter: Radio station, Bangladesh Betar under Ministry of Information has invited for tenders for the Purchase, Installation, Testing & Commissioning of 05 kw FM Transmitter for Bangladesh Betar, Banderban, Bangladesh. The tender was published on 25th March, the last selling date of the tender is 7th May, tender closing date and time is 8th May 12:00pm and tender opening date and time, 8th May 12:30pm. For details of the tender contact: Md. Taimur Rahman, Station Engineer on behalf of Director General, Maintenance Section, Bangladesh Betar, Administrative building, Agargaon, Dhaka-1207, Bangladesh. Phone: 880-2-9123057, 9111923 Fax: 880-2-9118784

Procurement of Cardiology Equipment: Directorate General of Health Services under Ministry of Health and Family Welfare has invited for tenders for the supply of Cardiology Equipment. The tender was published on 20th March, the last selling date of the tender is 7th

May, tender closing date and time is 8th May 2012 11:00am and tender opening date and time, 8th May 2012 11:30am. For details of the tender contact: Brigadier General Ahsan Kabir Khan, Director, Stores & Supplies and Line Director (Procurement, Logistics & Supplies Management), CMSD, 30, Shahid Tajuddin Ahmed Swarani, Tejgaon, Dhaka. Phone: 88-02- 9129231. Fax: 88-02- 9126547 Email: [email protected]

Procurement of Radiology & Imaging Equipment: Directorate General of Health Services under Ministry of Health and Family Welfare has invited for tenders for the supply of Radiology & Imaging Equipment. The tender was published on 24 th March, the last selling date of the tender is 7th May, tender closing date and time is 8th May 2012 11:00am and tender opening date and time, 8th May 2012 11:30am. For details of the tender contact: Brigadier General Ahsan Kabir Khan, Director, Stores & Supplies and Line Director (Procurement, Logistics & Supplies Management), CMSD, 30, Shahid Tajuddin Ahmed Swarani, Tejgaon, Dhaka. Phone: 88-02- 9129231. Fax: 88-02- 9126547 Email: [email protected]

Construction of Bhairab bazar bridge on Meghna river: Department of Roads and Highways under Ministry of Communication has invited for tenders for the construction of Bhairab bazar bridge on Meghna river. The development partner of the project is JICA. The tender was published on 25th March, the pre-qualification closing date and time is 7th May, 5:00pm. For details of the tender contact: Md. Dalil Uddin. P.Eng, Director, Project Director (ACE), RHD EBBIP, Roads and Highways Department, Shetu Bhaban, Bangladesh Bridge Authority, Room No.601 (Level-5), New Airport Road,Banani,Dhaka-1212, Bangladesh. Fax: 88-02- 9562798.

Note: for more information on these and other tenders, visit:

http://www.cptu.gov.bd/Notices.aspx

Events


Tenders

Events


http://www.cptu.gov.bd/Notices.aspx



Business University Nyenrode and Netherlands Embassy in Bangladesh sign agreement to combat poverty by enhancing responsible business. On 22 March the start of this unique partnership was celebrated at the university premises in Breukelen. Nyenrode will do market research in Bangladesh and bring in depth market information to Dutch companies and investors. Trade missions will follow aiming at matchmaking. As a result of the expected sustainable business deals, jobs will be created with a positive social and environmental impact on the areas of investment. The objective is creating a win –win economic diplomacy model enhancing responsible business and reducing poverty. Before this summer Nyenrode will detach a business expert to join the embassy for a period of 3 years.

Ambassador Hennekens witnesses SA8000 assessment at Dutch-Bangla Pack Ltd. On the 19th of March, 2012 H.E Alphons Hennekens visited the Dutch-Bangla Pack Limited (DBPL) factory at Munshiganj during their ongoing assessment for SA8000 along with stakeholders from FMO. DBPL is a Netherlands-Bangladesh joint venture company established in 2007. Local shareholders hold 50% shares while remaining 50% shares are held by LC Packaging International BV (LC), Netherlands. LC Packaging is one of the largest global traders of packaging materials, with operations in Europe and

Africa. DBPL is one of the leading FIBC producers in Bangladesh. DBPL is committed to responsible business practices with absolute regard for human rights. Through their Social Accountability Program, they uphold this commitment not only for the core business, but for the suppliers and vendors as well. A key component of the Social Accountability Program is the global workplace standard SA8000, developed by Social Accountability International. Unlike other standards of accountability, SA8000 sets forth a framework for managing the system through active worker representation, management responsibility, supply chain control and effective communication channels. DBPL believes that the holistic approach taken by SA8000 is the best system currently available to ensure the humane and ethical treatment of workers, therefore motivating DBPL to implement the SA 8000 standard. This Social Accountability Framework (SAF) is built in order to set the framework of DBPL’s social accountability policy and practices. It provides a guide for activities, projects and initiatives put in place by DBPL to ensure compliance with the requirements of SA 8000 and communicate in a clear and transparent way to all our stakeholders. For more information click: http://www.dbpackltd.com/index.html

Ambassador Hennekens attends the ceremony of Western Marine handing over the two vessels to its German buyer: Western Marine Shipyard, set another milestone in



http://www.dbpackltd.com/index.html

the country's shipbuilding history by delivering the last two vessels of an order the shipbuilder won from a German buyer in 2008. The two ice class cargo vessels -- EMSWater and EMSFlow -- made by the local company at €8.8 million each were handed over to the German buyer, Grona Shipping GmbH, at a ceremony at Chittagong Boat Club in Patenga. Competing with the Chinese and Vietnamese shipbuilders, Bangladesh exports ocean-going vessels to high-end markets such as Denmark and Germany.

Upcoming Events

Bangladesh Furniture and Interior Décor Expo 2012: Export promotion Bureau in association with Katalyst and others (Bangladesh Furniture Exporters Association, Banglacraft and Jute Diversified Products Manufacturers & Exporters Association) will organize the event “Bangladesh Furniture and Interior Décor Expo 2012” from 26-28 April 2012. During this occasion only Bangladeshi producers of furniture and allied products will exhibit their products to the overseas visitors. For details of the event visit: http://www.bfidexpo.com/

Queen’s Day: The Embassy of the Kingdom of the Netherlands will be celebrating Queen’s Day, the National Day of the Netherlands on the 30th of April 2012 at the Hotel Radisson Blu. This provides an opportunity to exhibit the Dutch business presence and products in Bangladesh and promote bilateral trade between the Netherlands and Bangladesh. The Embassy has received seven confirmed sponsorship offers for this event from Dutch-Bangladeshi businesses that are eager to seize this unique occasion to promote and expand their business, network and expertise. Any interested Bangladeshi or Dutch company willing to participate in this event can contact the Economic Division of the Embassy. If you have queries please send an email to Ms Arman Khan at [email protected]

The Embassy always welcomes your comments and suggestions for the Newsflash. We also encourage interested Dutch and Bangladeshi companies to place their article or message in our newsflash. For more information you can contact our commercial department at the Dutch Embassy in Dhaka through email [email protected] or by phone (00882) 8822715-8.


More Information




http://www.bfidexpo.com/

bangladesh newsflash march issue

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