The News
Saturday 22 of June 2024

Never the Twain Shall Meet

Supradip Chakma turning in his credentials,photo: Wikipedia
Supradip Chakma turning in his credentials,photo: Wikipedia
The removal of politics from business is a key factor in Bangladesh’s success story

Bangladeshi Ambassador to Mexico Supradip Chakma doesn’t believe in mixing politics and business, and neither does his government.

“Our government is 100 percent secular, and we don’t let politics get in the way of doing business,” he said during a recent trade and investment seminar he hosted with the Mexican Council of Foreign Commerce (Comce) at Mexico City’s Club de Industriales.

“We are developing business ties with all our neighbors, despite the fact that some of them do not get along well with each other. But for us, business is business, and it has nothing to do with politics.”

This never-the-twain-shall-meet policy of separation of state and commerce has served Bangladesh well over the last two decades.

The South Asian nation that once was the posterchild for developmental dysfunction and mass starvation (remember the 1971 benefit concert sponsored by former Beatle George Harrison and Indian sitarist Ravi Shankar asking the world to feed Bangladesh’s famished masses?) is now the third-fastest growing economy in the world, right behind China and India.

The little nation that could (Bangladesh’s entire geographic area is about 148,000 square kilometers, roughly the size of the state of Jalisco, with a staggering population of about 164 million, making it the eighth-most populous country on Earth) has been growing by leaps and bounds since the start of the millennial, and it is slated to become the world’s 23rd-largest economy by 2050, according to London’s PricewaterhouseCoopers (PWC) professional services network.

Last year, Bangladesh registered an impressive 7.1 percent growth, and
Chakma said that the country’s target growth for 2017 is 7.7 percent, and 8 percent for 2020.

Between 1990 and 2010, life expectancy in Bangladesh increased by 10 years, from 59 to 69, and the incidence of poverty has dropped by half, from 45 percent to 22 percent.

Infant mortality is also way down, from 97 deaths per thousand live births in 1990 to 19 per thousand in 2016.

So how has Bangladesh — a country with practically no mineral or other natural resources historically teetering on the edge of a seemingly endless cycle of cyclones and famines — managed to accomplish all this?

By focusing investment in labor-intensive businesses, such as the garment and textile industries, financing education and health care, and, perhaps most importantly, concentrating on becoming agriculturally self-sufficient.

Remittances from the six million Bangladeshis working abroad also help, representing about $13 billion in revenues, about 14 percent of Bangladesh’s national income.

But, like Chakma said, the removal of politics from business is a key factor in Bangladesh’s success story, especially considering the dismal state of the nation’s political landscape.

Between a hellish war of liberation from Pakistan in the early 1970s that led to the brutal slaughter of more than three million Bangladeshis, a parade of military coups in 1975, 1982 and 2007, an ongoing power struggle between viciously warring parties that are not above orchestrating assassinations to get their points across and their candidates in power, and sporadic assaults of terrorism by the Islamic State (I.S.) and other jihadi groups, Bangladesh is about as far from politically stable as you can get without being Sudan, Iraq or Syria.

Yet despite those political setbacks — which would seriously derail growth in most countries — Bangladesh’s economy just keeps chugging along.

And while the political rink in Dhaka may be down and dirty, the cut-throat contenders for national power are smart enough to know that impeding business or sowing seeds of economic discontent would only result in the total collapse of their frail nation, essentially leaving them all with no territorial pie to slice up.

So by written or unwritten contract, political leaders have agreed to keep their squabbles and infighting out of the business world and to keep their hands off private investment money.

Bangladesh also boasts an army of smart economists — including Nobel Prize Laureate Muhammad Yunus, who established the Grameen Bank and a prototypical microcredit and microfinancing system — who, without the cumbersome intervention of politicians, have developed a pragmatic national program for economic growth.

With the garment, textile and leather industries firmly in place and solid growth taking hold in the rural sector, these economists are now focusing on attracting investment in the energy, pharmaceutical, information technology, telecommunications and infrastructure sectors.

In its favor, Bangladesh has a highly trained workforce coupled with a low cost of living.

And to help ease the understandable concerns of hesitant international corporations, Bangladesh has streamlined bureaucratic processes, opened an English-language internet portal to assistant businessmen in navigating trade and investment regulations, and has set up a variety of incentives for foreign capital ventures and export-oriented industries.

The government of Bangladesh is also sponsoring trade and investment symposiums and seminars around the world (including the one in Mexico).

All of these strategies have paid off big-time for Bangladesh.

Last year, it received $1.8 billion in direct foreign investment capital, up from $1.4 the previous year.

When it comes to economic development, Bangladesh is not out of the woods yet, and it may be a very long time before it reaches OECD status.

But for all the social and political impediments, Bangladesh has made and is making significant strides in growing its economy and providing for its burgeoning population.

And its core philosophy of the separation of government and business may be at the heart of that success.

Thérèse Margolis can be reached at [email protected].