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Bangladesh Frontier Forum, Oslo 17 April, 2012
Address by Ragne Birte Lund, Ambassador of Norway to Bangladesh
Why Bangladesh? Why Now?
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Ladies and gentlemen, dear friends,

The Frontier Forum on “Why Bangladesh and why Bangladesh now” is the first
business focused networking event on Bangladesh taking place in Norway. I would
like to welcome everyone and especially the participants from Centre for Policy
Dialogue, CPD, an independent think tank on economic issues in Dhaka and a long
time research partner of Norway together with CMI, Christian Michelsen’s Institute.
They are here with other central actors from private and public sector in what will
hopefully be an insightful and eye opening debate on “Why Bangladesh and Why
now”. I also welcome the Embassy of Bangladesh in Stockholm.

Bangladesh has transformed itself from what Henry Kissinger 40 years ago called an
international basketcase, to what is now an emerging high potential business
destination. From facts, trends and observations about Bangladesh, I want to share
those I feel are most meaningful to a business community exploring new markets and
production hubs. I welcome everyone and would like to thank Telenor for hosting it.

Today’s Forum coincides with the 40th anniversary of the establishment of Norway’s
diplomatic relations with the newly independent state of Bangladesh in April 1972.
Many of you may recall news from the 70s and 80s in where hundreds of thousands
had died in war, famine, cyclone and flood, mixed with some bloody military coups.
Many had strong doubts about the future of the country that was laid in ruins.
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Despite the grim prospects at the onset of independence, the people of Bangladesh
have demonstrated tremendous resilience, hard work and faith in their dream of
building a prosperous nation. More and more foreign companies explore the country
as a business destination and decide to invest there. There is good and bad news
emerging from Bangladesh, but frequently the bad news gets all the headlines. The
progress, modernisation and success stories hardly ever make it to the news.
Bangladesh is increasingly competitive in a number of sectors .Bangladesh has
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invested a lot in disaster management and has shown that prevention pays. I would
like to show Norwegian business the opportunities that are present in Bangladesh.

While Asia and Bangladesh are growing, our own continent, Europe, is in real, deep
and lasting economic trouble. We are facing a very different world compared to only a
few years ago. For long term success it is important that the business community looks
beyond our traditional markets.

We often talk about the BRICS countries with good reason, these are massive
countries with rapidly growing economies that are or will be among the largest in the
world. Many of the companies that entered the BRICS a decade or two ago are now
reaping the benefit. I would like to encourage the companies present here today to
seriously explore Bangladesh as a business destination.

Jim O’Neill, the Goldman Sachs banker who coined the BRICS moniker, came up
with another one – “the Next 11”. In this group we find, amongst others, Indonesia,
Turkey, Mexico and Vietnam. The only Least Developed Country in this group is
Bangladesh.

So why is Bangladesh in this group? I think this is a question worth asking. The main
reason is that Bangladesh is unique among the LDCs due to the large size of its market
and work force and its capable business community. The fact that it is both among the
Least Developed Countries AND among the most potential frontiers invites to some
out of the box thinking for collaboration and initiatives to boost development and
trade.
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Bangladesh is well on the way to achieve several of the key targets of the UN
Millennium Development Goals. Child and maternal mortality is down, more children
go to school – and girls in particular. In fact, Bangladesh does better than India on
most MDGs. Innovative civil society initiatives and approaches to fight poverty were
born in Bangladesh, such as the Grameen Bank founded by professor Yunus who
received the Nobel Peace Prize for micro finance services for the poor. BRAC is one
of the largest NGOs and works in many hotspots around the world. These
organizations have become models for other countries.

Over the years Norway’s relationship with Bangladesh has matured. We have moved
from a traditional donor role to that of a development partner, to collaboration
between institutions on emerging issues and to a facilitator of trade and dialogue
partner on international issues.
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Bangladesh is playing an increasingly important role on the international arena. We
share a common interest in strong multilateral institutions and a UN led world order.
Bangladesh is the largest contributor of military and civilian personnel to UN peace
keeping operations. Bangladesh plays a constructive role in the international
negotiations on climate change on behalf of the most vulnerable countries, and is also
an active participant on gender issues internationally.
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In other words, Bangladesh is undergoing rapid change with new opportunities for
human, social and economic development. Bangladesh has had robust economic
growth averaging at about six per cent over the last 20 years. It has the world’s 7th
largest population of approximately 160 million! with a growing middle class and
domestic market. It is a multicultural and multi ethnic society with a majority Muslim
population. Women play an increasingly active role in the economy, both as factory
workers and entrepreneurs.
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However, Bangladesh scores poorly in many global business indexes, and there are
many regulatory and structural challenges. Nevertheless, it makes sense to follow the
trends, many of which are strongly improving. From 2001 to 2005, Bangladesh was
ranked as the most corrupt nation in the world. Now it has moved up 62 positions to
number 120, a quite remarkable improvement in 6 years. As a curiosity, in terms of
investor protection for minority shareholders in companies, Bangladesh and Norway
share the 24th position! So where the development community has laid the foundation
for improvement, it is the business community that can make change happen faster
towards better positioning of Bangladesh. The establishment of the Nordic Chamber
of Commerce and Industry in Bangladesh late in 2010 is indeed important. The
Chamber acts as a platform for sharing knowledge and experience among Nordic
businesses in Bangladesh and liaises with other chambers on common issues.
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The Ministry of Foreign Affairs is organising this Bangladesh Frontier Forum because
we believe Norwegian businesses need to know about which opportunities – and
challenges – there are in this market, to share experiences and learn from each other
and give the Ministry and the Embassy feedback in order to plan strategically. It is
you and your knowledge that best can help us shape a business friendly development
policy. Engage with Innovation Norway that runs the Business Match Making
Program in Bangladesh funded by Norad. It is still in its early stage. Some of the
participants here will hopefully share their experience. And seek advice from the
Nordic Chamber of Commerce and Industry, NCCI, in Dhaka.
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Just get started, the sooner the better. This is what Telenor did 15 years ago when
they opened their GSM network in Bangladesh, their first non-Europe destination.
Bangladesh was Telenor’s starting point for an expansion that has taken them into a
number of Asian markets. We are at the Telenor Expo today. Telenor’s success in
Bangladesh is well-known in Norway.
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Early movers can gain unique advantages and positioning in the market. When
Telenor was established in Bangladesh, the Swedish rival Telia had already been
offered the mobile license. But Telia turned it down, because they did not see the
market in Bangladesh developing very rapidly. They were indeed wrong.
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Business communities from many different countries now look to Bangladesh.
Samsung has set up one of its largest research centres in the world in Dhaka. They
have come to the conclusion that Bangladesh offers skilled engineers and researchers
that can compete with engineers anywhere else.
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Unfortunately there are not many other Norwegian businesses that have established
themselves in Bangladesh, though there are several opportunities in business areas
where Norwegian industries are strong. The reason may be perceived difficulties and
the unknown factors combined with better visibility and perceived smoothness of the
more obvious business destinations.
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One of the strongest drivers of sustainable development is in our view responsible,
long-term investment and private sector development. Through trade and long-term
investment, transfer of technology, knowledge and competence building, businesses
can contribute to infrastructure and asset development, enforcement of ethical
guidelines and labour standards, Corporate Social Responsibility and competence
development. Norwegian companies can contribute to significant job creation, raised
standards and global competitiveness, increased tax revenues and diversified and
sustainable economic and social development. You can show the way for greater
participation of women in economic life. So look at Bangladesh for achieving both a
profitable business growth as well as seeing a social impact of your activities, where it
is most needed!
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Bangladesh is a production base for exports to developed markets, but it is also
realising its potential as a production base for exports to other developing countries.
The economic ties with India are evolving and trade between India and Bangladesh is
predicted to double from the fiscal year of 2011 to 2012. In 2011 exports of clothes
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from Bangladesh to China grew by 179 % and it continues to grow quickly as Chinese
factories relocate to Bangladesh. China is becoming the importer of labour-intensive
goods in a way that few would have expected. In 2011 Bangladesh exported 18 billion
US dollars worth of clothes, sold at high multiples by the time they reach their
destination markets.
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As Myanmar opens up China is looking to build rail and road links from its southwestern metropolis of Kunming straight to Bangladesh. It is indeed noteworthy that
Bangladesh and Myanmar just last month resolved their long time maritime border
dispute through the arbitration of the International Tribunal for the Law of the Sea. A
security threat has been turned into a win-win situation for both. The ruling is the first
of its kind. This opens up for further maritime and oil and gas exploration for
Bangladesh and for the development of a more pragmatic relationship with Myanmar.
The changes that are emerging in Myanmar may also pave the way for closer
economic ties for Bangladesh with the South East Asian nations (ASEAN).
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In short, Bangladesh is positioning itself as a strategic sub-regional hub.
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Norway has been present as a donor in Bangladesh since independence and more than
1 billion US dollars have been spent in development assistance over the years. In the
last 15 years, Grameenphone has invested more than 2 US billion dollars and enerated
3 billion dollars in direct and indirect taxes for Bangladesh. There is a lot of good-will
towards Norway in the country that we can benefit from as the relations increasingly
are taking shape as partnerships. There are persons in Norway who know a lot about
Bangladesh, who can share their insights as our focus is shifting away from traditional
assistance to investment and trade and international cooperation.
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What will happen in the years to come, where will Bangladesh be in 10-20 years?
Without venturing into prediction I believe Bangladesh is a country that may surprise
the world anew with its innovative and strategic capabilities. It therefore deserves our
attention in a world of changes with new countries presenting new opportunities.
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I am very pleased to open this forum today and look forward to a nuanced debate that
will highlight the risks and opportunities Bangladesh presents to Norwegian business.