Singapore-Bangladesh ties a study in complementarity for win-win gains
THE Bangladesh economy finds itself on the cusp of transformative growth, ready to make the step up to a middle-income nation. As it continues its growth journey, facilitating the flow of goods and services, ideas and people across borders will remain a vital part of the development challenge; regional collaboration and inclusive globalisation are central themes of its solution.
For a region as diverse as Asean and South Asia - not least in terms of economic development - regional integration can be a challenging task. Cooperation and collaboration will require both countries to find areas of mutual benefits and shared opportunities. These opportunities are not always easy to identify, but in some cases, they can be somewhat easier to spot.
Bangladesh and Singapore have always enjoyed warm bilateral relations, ties that have only strengthened over time. Bilateral trade grew from around US$2.1 billion in 2013 to US$2.8 billion last year. Singapore is also a major source of FDI (foreign direct investment) for Bangladesh. In 2017, net FDI inflow from Singapore into Bangladesh was the second highest of all countries, at around US$200 million, accounting for more than 9 per cent of total net FDI inflows.
Singaporean companies have invested in manufacturing, information and communications, oil and gas, services, chemical engineering, textiles, agro-based products, and printing/publishing - but the largest sector by far for Singaporean FDI was power generation. Singapore has invested around US$390 million in Bangladesh power sector, making it one of the largest foreign investors in this area. It is easy to see why Singaporean capital and businesses are increasingly considering Bangladesh as an attractive destination. Over the past decade, Bangladesh's economy has recorded annual growth of more than 6 per cent on average. Macroeconomic growth, currency stability and stable geopolitical conditions mean Bangladesh's market fundamentals remain strong. Inflation has been moderate and public debt levels are low by world standards.
With a median age of 26.7, Bangladesh's growing working-age population will endow the country with the benefits of demographic dividend today and in the coming decades. Sustained growth is also driving tremendous upward mobility. This rising middle and affluent class - expected to grow from 12 million to around 34 million by 2025 - coupled with fast-paced urban growth, will create voracious demand for a broad variety of consumer goods and services.
Source: https://www.businesstimes.com.sg