Nordic companies in Bangladesh have identified corruption, inadequate transport infrastructure, bureaucratic tangle and administrative hurdles as the biggest challenges for doing business in Bangladesh.
According to the ‘Business Confidence Survey 2017’ report of Nordic companies in Bangladesh the challenges might pose significant risks to the existing companies as well as future investors.
Nordic Chamber of Commerce and Industry in Bangladesh together with the Sweden Bangladesh Business Council and supported by three Nordic embassies (of Sweden, Norway and Denmark) conducted this survey which was launched on July 2 in the city.
Commerce minister Tofail Ahmed was present as the chief guest at the launching of the survey in Dhaka on Monday evening.
The survey was conducted between December 3, 2017 and February 15, 2018 and questionnaire was sent to a total of 52 companies, all members of NCCI. Of them 22 responded.
The report showed that 59 per cent of the respondents identified corruption and similar number of businesses identified inadequate transport infrastructure as biggest problems for doing business in Bangladesh while 45 per cent blamed bureaucratic and administrative hurdles.
Nordic companies identified other problems include political instability, tax administration, tax rates and business licensing and permits.
‘Majority of the respondents do not consider access to finance, land, natural gas supply, labour regulations and increasing labour costs as business challenge,’ the report says.
Many companies also identified an urgent requirement to have more transparency in the system and address corruption at all stages.
Despite the challenges, a big majority of the companies have planned to increase their activities and this could be owing to the respondents experiencing higher profits compared to other markets.
The survey shows that 82 per cent of the respondents are looking to expand their operations in Bangladesh over the coming three years, which was a slightly lower compared to 91 per cent and 94 per cent in the year of 2015 and 2017 respectively.
It says that 45 per cent of the respondents experienced higher profits in 2017, a rise from 34 per cent in 2015 and only 5 per cent feel it is less profitable to undertake their business in Bangladesh.
The survey respondents are reportedly looking to expand their operations with an expected investment of €213 million in the next three years and confirmed having invested about €167 million between 2014- 2017 in Bangladesh, the report says.
According to the report, 86 per cent of the Nordic businesses have sustainability or corporate social responsibility programmes in Bangladesh and 59 per cent of the companies have their sustainability programmes integrated into their supply chain.
The report hoped to form a basis for more dialogues, including private-public dialogues to monitor reform agendas and benchmark against the best practices and innovations of Nordic businesses.
Commerce minister Tofail Ahmed called upon the Nordic companies to increase their investments in the country while speaking as chief guest at the launching of the survey report.
He said that the government would ensure all facilities to secure the investments of foreign investors.