lightcastle business confidence index 2016 findings
TRANSCRIPT
©LightCastle Partners 2016 Pg 1
COMING OF AGE OR A FALSE DAWN?
Pg 2
2011 2012 2013 2014 2015 201655.5
66.5
77.5
6.5
7.1
6.5
6 6.1 6.3
6.5
6.36.03
6.29 6.516.8
Bangladesh GDP Growth ComparisonWB IMF
HOW DOES THE FUTURE LOOK LIKE?
Pg 3
Government
Private
Sector
Taxation Regime
Logistics and Infrastructure Power &
Energy
Policy Support
Investments
International Trade
LIGHTCASTLE BUSINESS CONFIDENCE INDEX
HOW WAS THE INDEX CALCULATED?
Pg 5
Primary Sector (15%)Jute, Protein & Frozen Food, Tea and Agro-processing
Secondary Sector (40.6%)RMG & Textiles, Pharmaceuticals, Power, Cement, Edible Oil, Steel and FMCG
Tertiary Sector (44.4%)Financial Institutions, High End Hotels, Business Services and Information Technology• 54 Samples from C-Suite
Members
• Surveys conducted from Dhaka, Chittagong and Khulna
• Conducted during June-July 2016
Harmonized Business Confidence Index
Business Confidence = √[(Situation+200) × (Expectations+200) - 200]
BUSINESS CONFIDENCE INDEX 2016
Pg 6
-100 +100
Overwhelmingly pessimistic
Overwhelmingly Optimistic
0 +39
COMPONENTS OF THE INDEX
Pg 7
Macro Economy
Industry Status
Firm Performance
Pg 8
STABLE BUT CAUTIOUS OF UNCERTAINTY
Pg 9
• Stable political Conditions and decent government policy support • Policy support skewed towards some sectors e.g. RMG and IT• Interest rate decline but still pricy loans
CAUTIOUS BUT OPTIMISTIC IN MAKING INVESTMENTS
Pg 10
POSITIVE ABOUT EMPLOYMENT GENERATION
Pg 11
SECTOR BASED FEEDBACK
Pg 13
Agro-ProcessingTechnology playing a role. Export potential and forward market consolidation opportunity
CementGovernment infrastructure projects sustaining demand. Low prospects of export.
Power Tremendous potential but
But red tapes hindering growth
Financial InstitutionSector recovering but classified
loanand declining interests negatives.
Consumer Durables MAC population growth will lead to Higher demand.
ITESProspects high and augmented by
Government policies.
SECTOR BASED FEEDBACK
Pg 14
FMCGDemand growing but ‘last mile logistics’ and focus on BOP market key to future growth. High-end HotelsCyclical in nature with bulk coming from Business travel. Recent troubles after terrorist attacks.
Pharmaceutical Growth in domestic market to
be stable. But export can open new doors for growth
Real EstateSector still recovering
through priceCorrections. Lower interest
rates to Spur demand..Leather
Vertical integration and rising costs ofCompetitor.
RMGMoving to high end products key to growth. Competitors’
products getting pricier.
CHALLENGES HINDERING PROGRESS
Pg 16
SALIENT ONES INCLUDE
Pg 17
POSITIVE ABOUT EMPLOYMENT GENERATION
Pg 18
FUTURE DRIVERS OF GROWTH
Pg 19
©LightCastle Partners 2016
READY CONTENTSPg 20
MANTRA FOR PROGRESS
Pg 21
• Prioritizing political stability and security
• Facilitating foreign investments in the manufacturing sector
• Incentivizing for export once domestic demand is met
• Increasing rewards and recognition in tax payment
• Connecting academic research to commercial application
THANK YOU!
Pg 22