BD ranks one of the lowest in terms of operating profit

FE Report | Published: February 24, 2015 00:00:00 | Updated: November 30, 2026 06:01:00

Bangladesh ranked one of the lowest in terms of operating profit among 20 countries surveyed by JETRO although it offers the lowest worker wage.
Compared with Japan, cost of production in Bangladesh is less than half (48.7 per cent), while in other countries (under the survey) especially in China it is 77 per cent and Vietnam 71 per cent, the survey said.
Among the surveyed countries, Bangladesh ranked the lowest in terms of quality of the employees as 68 per cent CEOs think that the quality of the employees in Bangladesh is not up to the mark, according to the survey.
The survey, however, made a number of suggestions including reduction of credibility gap and taking measures to attract more Japanese and more export to Japan.
It, however, mentioned that although investors were interested to invest in Bangladesh as Diffusion Index (DI) is high, but they were sensitive because of generating loss. It is high time that the industrial policy addresses the issue concerning skill development and capacity building.
Regarding the next investment destination for Japanese-affiliated firms, the survey said firms are expanding their operation in Bangladesh, India, Vietnam and Thailand mainly due to sluggish operation and struggle for expansion of business in China.
Japan External Trade Organisation (JETRO) conducted the survey on 10,078 firms of 20 countries in Asia and Oceania region during October-November period of 2014.
The survey titled 'JETRO's Survey of Japanese-Affiliated Firms in Asia and Oceania (FY 2014) directly interviewed chief executive officers (CEOs) of firms who provided the best inputs.
In the survey, 68 per cent CEOs think that the quality of the employees in Bangladesh is not up to the mark.
Workers' wages in manufacturing sector in Bangladesh is US$ 100, followed by Cambodia with $113, Vietnam $176, India $239, Indonesia $253, Thailand $369 and China $403.
Japanese investors think that there is a huge space for further reduction of cost in Bangladesh, the survey said, adding: 84 per cent of CEOs saw the opportunity for cutting cost further in Bangladesh.
Some 71 per cent CEOs interviewed had expected that the profit would increase in Bangladesh while the Diffusion Index (DI) indicates Business Confidence is the highest in 2015.
Considering the export destination of Japanese-affiliated firms in Asia and Oceania regions, Bangladesh achieved one of the highest export ratio which is 66.3 per cent compared to 59.8 per cent in China. Vietnam sees 58.2 per cent, Sri Lanka 44.5 per cent, Thailand 39.8 per cent and India 32.3 per cent.
The survey portrayed that the highest utilisation of FTA (Free Trade Agreement) was made by firms engaged in trade of textiles.
msshova@gmail.com