Japanese Economic Zone: The dream of developed Bangladesh
Bangladesh hopes to open new horizons for Japanese and foreign investment in Bangladesh through the Japanese Economic Zone. Once the zone is operational, the country expects an investment of approximately $1.5 billion
The present government, under the leadership of Prime Minister Sheikh Hasina, took the important initiative of enacting the Bangladesh Economic Zone Act. This act aims to establish economic zones in potential areas of the country, expand industrialisation, attract domestic and foreign investments and create employment opportunities.
The purpose of establishing the economic zone is to play a leading role in realising the "Golden Bangla", the dream of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman, through economic liberation. Under the visionary leadership of the Prime Minister, BEZA has been working tirelessly since 2013 to change the country's economic landscape through planned industrialisation.
Due to the Covid-19 pandemic and the Ukraine-Russia war, the development work of almost all countries, including Bangladesh, has reached a standstill. Still, BEZA is continuing its efforts to keep its development activities running.
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According to the World Bank, Bangladesh's growth and development are inspiring. The country aspires to be an upper-middle-income country by 2031. It has a strong track record of growth and development, especially in times of global uncertainty.
Asian Development Bank, Japan External Trade Organization, The Economist, The Wall Street Journal, J.P. Morgan, Goldman Sachs etc, also highly praised Bangladesh's economic growth and development.
Bangladesh hopes to open new horizons for Japanese and foreign investment in Bangladesh through the Japanese Economic Zone. Famous companies like Singer and Rudolph have already started industrial construction there.
In addition, an agreement was signed with two Japanese investors last December. These are Onda Corporation, a manufacturer of gas metres, and Nikka, a manufacturer of chemicals. Besides this, around 30 other Japanese and ten companies from other countries have expressed interest in investing.
Bangladesh expects to sign agreements with several organisations soon. Once the entire economic zone is operational, the country expects an investment of approximately $1.5 billion. Apart from this, thousands of people will have employment opportunities.
Bangladesh achieved lower-middle income status in 2015. It is on track to graduate from the Least Developed Countries (LDC) list by 2026. We hope to become a middle-income country by 2030 and a developed country by 2041.
The development of the Japanese Economic Zone in Bangladesh started with the visit of the Hon'ble Prime Minister to Japan in 2014. The issue was seriously discussed during the visit of then-Japanese Prime Minister Shinzo Abe to Bangladesh in 2015.
In 2016, Japan International Cooperation Agency (JICA) undertook a feasibility study to establish a Japanese Economic Zone in Bangladesh. In the same year, the Japanese government recommended the appointment of the world-renowned firm Sumitomo Corporation as the developer.
According to a recent survey by JETRO, 68% of Japanese companies operating in Bangladesh plan to expand their business in the next two years and 65% of Japanese companies operating here think they could make a profit.
After a feasibility study in 2017, JICA gave an opinion in favour of setting up a Japanese economic zone at Araihajar in Narayanganj. Later, an agreement was signed between BEZA and Sumitomo Corporation in 2019 to establish the Japanese Economic Zone.
According to the information of Bangladesh Special Economic Zone Limited, Japanese investors are interested in expanding their business in Bangladesh, and many visit the zone regularly. The Japanese Economic Zone can potentially become the "dream destination" of thousands of young people from Bangladesh.
The technology transfer path between Japan and Bangladesh will also be smooth because of it. A separate OSS Center and Skills Development Center will be established in the Japanese Economic Zone.
Japan is Bangladesh's 7th largest import source ($2.5 billion). The FDI stock of Japan in Bangladesh is about $500 million. However, there are other opportunities for Japanese businesses in Bangladesh. According to a recent survey by JETRO, 68% of Japanese companies operating in Bangladesh plan to expand their business in the next two years and 65% of Japanese companies operating here think they could make a profit.
One of the achievements of the Hon'ble Prime Minister's 2014 visit to Japan was establishing a separate economic zone for Japanese investors in Bangladesh. Besides this, Nippon, one of Japan's largest steel manufacturers, invested in Bangabandhu Shilpa Nagar. One of Japan's largest car manufacturers, Honda, invested in the Abdul Monem Economic Zone.
We hope a new horizon of Japanese investment in other economic zones, including the Japanese Economic Zone, will be opened after Bangladesh's Prime Minister's visit to Japan in April 2023. And with that, the way to a developed, prosperous and smart Bangladesh will become faster and smoother.
Md Abdul Quader Khan is a development worker currently collaborating with Bangladesh Economic Zones Authority.
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions and views of The Business Standard.
