A Vietnamese company is set to invest around $100 million in Bangladesh's leather sector.
The company is eyeing duty benefits Bangladesh enjoys on exports to the European Union, Japan, Canada, Australia and several other developed countries, said industry insiders.
An agreement between the Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh (LFMEAB) and Vietnam Leather, Footwear and Handbag Association would be signed today, they added.
LFMEAB will help the Vietnamese company set up a factory on the outskirts of Dhaka or Chittagong and maintain liaison with the government, said the association President Saiful Islam.
He, however, did not mention the name of the Vietnamese company.
“The company is coming to Bangladesh mainly to avail the duty benefits on shipments from here.”
Goods from Bangladesh have a competitive edge in the countries where Bangladesh enjoys duty benefits.
Bangladeshi goods also have preferential access to China, Malaysia, South Korea, several South American countries including Chile.
At least three other trade and investment agreements are likely to signed during the three-day visit of Vietnamese President Tran Dai Quang.
Shafiul Islam Mohiuddin, president of the Federation of Bangladesh Chambers of Commerce and Industries, said a Vietnamese food company would sign an agreement with an organic food company in Bangladesh to embark on a joint venture here in Bangladesh.
A group of Vietnamese businesspersons is accompanying President Tran.
“We will form a joint business council for facilitating bilateral trade between the two countries,” Mohiuddin said, adding that the FBCCI had similar councils with many other countries.
The FBCCI and the Vietnam Chambers of Commerce and Industry will also sign agreements for strengthening cooperation in trade and investment between the two countries, he said.
The visiting president and his entourage will hold a business forum in Dhaka to discuss the challenges and prospects in bilateral trade and investment, according to Mohiuddin.
Trade between Vietnam and Bangladesh is heavily tilted towards Vietnam with Bangladesh importing goods worth $417 million in 2016-17.
At the same period, Bangladesh's export to the country was only worth $66.44 million, according to the FBCCI.
VIETNAM PRESIDENT IN DHAKA
President Tran Dai Quang arrived in Dhaka yesterday with a 195-member delegation on a three-day visit, which is expected to be a landmark in advancing bilateral political and economic ties.
Vietnam hopes to strengthen investment in Bangladesh in the sectors of telecommunications, information technology, agriculture, food processing, textile, oil and gas, consumer goods, and infrastructure development and services.
The Vietnam president's visit is aimed at securing Bangladesh's support in the 2019 election for the Non-Permanent seats on the UN Security Council, said diplomatic sources.
Dhaka is expected to officially extend its support to Vietnam during the official talks scheduled for 10:00am at the Prime Minister’s Office.
The UNSC election will be held in mid-2019 during the 73rd session of the UN General Assembly for five non-permanent seats for two-year mandates commencing on January 1, 2020, when tenure of Côte d'Ivoire, Equatorial Guinea, Kuwait, Peru and Poland will expire.
Diplomatic sources said Tran came to Bangladesh after a three-day visit to India where he secured the support he had been looking for.
In the evening, President Abdul Hamid will host a banquet in honour of his Vietnam counterpart Tran Dai Quang at the Bangabhaban.