Bangladesh: the next Asian success story?
Most people associate Bangladesh with catastrophic floods and chronic instability, as Ernst Herb notes in Switzerland’s Finanz und Wirtschaft. But it’s come a long way. According to the IMF, growth is set to reach 7% this year, a 30-year high. A military-backed government has pushed through a series of reforms, with 26 state-owned enterprises set to be sold off.
“It’s a quantum leap in the mind-set of the government...that they’re embracing privatisation,” says Yawer Sayeed, CEO of the first and only private fund manager in the country. New-found political stability has encouraged foreign investment and consumption is also on the rise.
The Dhaka Stock Exchange Index has risen by about 80% this year amid these improved conditions. The market’s total value is a tiny $8bn, says Pooja Thakur on Bloomberg.com, but is expected to double to more than $15bn as privatisations provide further impetus and the market begins to appear on foreign investors’ radar screens. JP Morgan, Merrill Lynch and Citigroup – which last month became the first foreign lender to acquire a license to offer investment banking services – all reckon Bangladesh may be the “next Asian success story”, says Thakur.
