Asia Frontier Capital - Bangladesh Travel Report

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Within our ongoing on the floor research, Ruchir Desai, co-supervisor of the AFC Asia Frontier Fund, recently traveled to Bangladesh for an investor tour. Photos will be by Asia Frontier Capital.

Flying into Dhaka a single must be prepared for a long wait in immigration. Having traveled to Bangladesh multiple situations over the last few years I've gotten used to the slow-moving immigration lines at Hazrat Shahjalal AIRPORT TERMINAL. This time however the slow acceleration reached a fresh level - it had taken me so long that I experienced to gather my checked handbag from the “Lost & Found” table! Moral of the report: do not express your displeasure to the immigration officer as the “waiting time” could easily get longer and you will be advised that your passport has been ”reported” - the bureaucracy always wins! However, no complaints as they are a number of the quirks of investing in frontier markets.

The Gulshan area in downtown Dhaka
Given the ongoing insufficient quality hotel supply in Dhaka, most foreigners together with foreign investors stay at the Westin hotel, since it is well found in Gulshan, which can be an upscale district in the heart of Dhaka and home to many embassies. This time around, however, the Westin was totally occupied plus some of the tour individuals had to remain at other nearby hotels. Usually, the majority of the foreigners at the Westin happen to be either Indian or Chinese nationals but this time around there were a lot of unique nationalities residing at the resort - it appears the security issues of 2017 are over!

Hilton Dhaka approaching opposite the Westin
On this trip, a number of the investors came a day early so that we're able to go to the factories of two businesses as this gives one an possibility to get a feel of what is happening on the ground. Given the traffic circumstances in Dhaka, the meetings with corporates are nearly always placed at the Westin resort thus getting on the road is welcome. There have been two site appointments planned for your day you start with an ice cream and frozen foodstuff manufacturer followed by a truck and bus assembler. The ice cream and frozen foodstuff factory was located in Gazipur which is about a 90-120 minutes get north from the Westin hotel in Gulshan. The absolute distance between both spots isn't large (25-30 kilometres) but given the traffic condition around Dhaka it often takes this long. Having said that, infrastructure investments continue to be made, with focus on the Dhaka metro previously underway.

The ice cream and frozen foodstuff assembly lines were both contemporary, using imported apparatus from European countries, and the ice cream industry in particular appears to have a whole lot of growth potential as per capita usage of ice cream found in Bangladesh is still suprisingly low with the sector growing found in the mid-teenagers annually. After sampling a sizable collection of ice cream, we had been off to our second site visit that was found in Dhamrai, a travel of about another 90 moments. The highways that people encountered were predominantly two lanes which leaves a whole lot of space for better infrastructure investments and selected important highways like the Dhaka-Chittagong highway have already been extended to four lanes while highway expansions happen to be also on the cards for various other important road links.
Source: https://seekingalpha.com

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