Bangladesh

Bangladesh is becoming a destination of choice for companies wanting to do business in Asia. Lying at the heart of a triangle formed by the world’s most dynamic economies — China, India and Southeast Asia — and home to a growing domestic market and a young, cost-effective workforce, Bangladesh offers vast opportunities.

Covid-19 latest information

This guide is an accurate reflection of the pre-Covid-19 business environment in Bangladesh. Please note that due to the current situation, some circumstances may have changed in this country. Figures and data in the guide were last updated in August 2020.

 

Welcome to Bangladesh

Bangladesh is one of the fastest-growing economies in the fastest-growing region in the world. The government has been actively making it easier to do business in the country, offering some of the most liberal policies in South Asia when it comes to foreign investment, fiscal incentives and repatriation of dividends and capital. Areas including infrastructure and supply chains are driving investments in the region. From ethical textile production and business process outsourcing to IT, Bangladesh is building a bright future.

Established in 1996, HSBC Bangladesh offers a range of financial services in Bangladesh including commercial banking, consumer banking, global liquidity and cash management, trade services, treasury, and custody and clearing.

With a comprehensive range of cross-border and financial services to suit both personal and business needs, HSBC can provide support whether you are moving to the country, working in the area, or purely investing or doing business in Bangladesh.

I look forward to welcoming you!

Md Mahbub ur Rahman CEO, HSBC Bangladesh

The Hongkong and Shanghai Banking Corporation Limited Management Office, Level 4, Shanta Western Tower,
186 Bir Uttam Mir Shawkat Ali Road, Teigaon Industrial Area, Dhaka 1208, Bangladesh

Essentials

Population
161.4 million1
Size
147,600 sq km1
Main languages
Bangla (Bengali and English are widely spoken)
Capital city
Dhaka
Other major cities
Chattogram, Khulna, Rajshahi
Currency
Bangladeshi Taka
Dialling code
+880
GDP
USD274.025 billion1
Top exports
Clothing and miscellaneous textiles, footwear, leather and tobacco
Top imports
Machinery, cotton, oil products, iron, steel, vehicles, plastics and cereals
Unemployment rate
4.3%2
Corporation tax
25%2
Typical office hours
9.00am – 5.00pm (public sector) and 10.00am – 6.00pm (private sector) Sunday to Thursday
Time zone
UTC +6
Emergency numbers
999

1 World Bank Group, 2019
2 Trading Economics, 2019

Bangladesh: South Asia’s emerging giant

Asia’s quiet achiever

Bangladesh’s economy has grown by over 5% every year since 2004, and over the past 20 years GDP per capita has grown by almost 650%. The roots of its new prosperity lie in the textile industry, which has undergone a massive expansion since the government switched its focus to export-driven growth in the 1980s.

Digitisation

The digital economy is a growing force in Bangladesh. Investment in digital infrastructure continues to increase, with 110 million active internet subscribers – the fifth largest internet user population in Asia-Pacific – and mobile internet penetration is expected to reach 41% of the population by 2025.

Middle-income vision

Bangladesh‘s vision is to achieve middle-income status by its 50th birthday in 2021. To support that, the country is investing heavily in infrastructure, improving the electricity supply, increasing transport connectivity, strengthening the country’s resilience to natural disasters and improving the use of labour. The development of an affluent middle class of around 30 million people offers significant opportunities for businesses.

Strategic location

Bangladesh lies at the heart of the world’s most dynamic region, with India to the West, China to the North and Southeast Asia to the East, opening up vast opportunities for participation in global value chains.

Educational achievements

Bangladesh has invested heavily in improving the education of its population as a foundation to reducing poverty levels and to create a flexible labour force, and the effects are starting to be felt. Although Bangladesh’s overall literacy rates are relatively low at 70%, for the 15-24 age group, it is above global averages at 93%.

Ranked

# 168

for ease of doing business (in a survey of 190 measured economies by The World Bank)

Country profile

Bangladesh has begun to emerge as a country with huge potential in Southern Asia, stepping out of the shadow of the region’s economic giants – India and China.

At independence in 1971, Bangladesh was one of the poorest and least-developed nations in the world. Decades of rapid economic and social growth have seen millions lifted out of poverty, new industries blossom, and the establishment of a solid foundation for further economic progress. Today, Bangladesh is a thriving urban-focused country with a booming textile industry and a burgeoning IT-enabled knowledge economy.

But the country still faces challenges. Poverty, unemployment, food security and climate change resilience will need to be addressed as the country develops.

However, against the backdrops of economic growth and continuing challenges, much of the charm of Bangladesh remains: the warm hospitality, the vigorous debate, and the sense of a country that believes in a better tomorrow still buoy the spirit of visitors.

Bangladesh is a country of rivers. Southwestern Bangladesh is dominated by the greater Ganges Delta, which covers around 23,000 square miles of land.

Read on to discover more about the dos and don’ts of doing business in Bangladesh and how trading in or with the country could help boost the future growth of your business.

5 reasons to do business in Bangladesh1

  1. Growing middle class
    As Bangladesh moves from a predominantly rural to a more urban economy and poverty levels fall, a rising and aspirational middle class is emerging.
  2. Increasingly educated population
    Moves to improve access to education are seeing results, with 90% of children enrolled in primary education and 62% in secondary. There is also an emphasis on grassroots digital education to increase opportunities in the digital sector.
  3. Infrastructure opportunities
    Investment in infrastructure will be crucial to support Bangladesh as it develops economically and there will be significant opportunities within the energy and infrastructure sectors.
  4. Government focus on attracting investment
    The development of economic zones is just one of several ways the Bangladeshi Government is seeking to increase private sector and overseas investment.
  5. Young population
    Bangladesh’s population is young, with almost half of the population under 25.

5 key challenges2

  1. 1

    Regulatory uncertainty

    Regulatory uncertainty is deterring some businesses from investing in Bangladesh: FDI is running at less than 1% of GDP. Challenges include a complex tax system that charges rates of between 3% and 40% to different businesses, unpredictable fluctuations in energy prices, and governance concerns.

  2. 2

    Transportation infrastructure

    A combination of rapidly rising traffic levels, poor maintenance and historically low investment has created a clogged transport system that is holding back growth, particularly in export-oriented industries.

  3. 3

    Climate change

    With an average elevation of less than five metres, Bangladesh is particularly vulnerable to the impact of climate change and rising sea levels. A recent report estimates that even if global carbon emissions are cut substantially, the current homes of some 30 million people (19% of the population) will be below the high tide mark by the end of the century.

  4. 4

    Foreign exchange policies

    Although Taka, the Bangladeshi currency, is freely convertible, foreign currency money transfers from Bangladesh are regulated and subject to restrictions under the Foreign Exchange Regulation Act (FERA). Subject to certain approvals, foreign investors are free to repatriate their invested capital, profits, capital gains, post-tax dividends and approved royalties and fees.

  5. 5

    Bureaucracy

    To outsiders, starting a business and accessing the legal systems may initially seem complex; however, working with a local representative can help businesses navigate the rules.

1 World Bank Group, 2019
2 KPMG, 2019