In a heartening development, more and more South Korean companies are coming to Bangladesh with investment plans, attracted by the country’s tremendous growth momentum.
“This is a positive development for Bangladesh as there would be technology transfer,” said Mohammad Mustafa Haider, managing director of Super Petrochemical, a concern of TK Group.
Super Petrochemical teamed up with SK Group of South Korea last year to invest $2.5 billion for setting up a petrochemical complex and a liquefied petroleum gas terminal in Moheshkhali.
More than 150 Korean companies have invested a total of $1.15 billion in Bangladesh, making the East Asian country the fifth highest investor, said Mohammad Masud Rana Chowdhury, commerce counsellor at the Bangladesh embassy in Seoul.
While most of the Korean investments are in the labour-intensive garment manufacturing sector, new funds are flowing in to power, shipbuilding, housing and banking sector.
In the last six months about 20 big Korean companies showed their interest in Bangladesh as the investment climate is improving very fast, Chowdhury added.
More and more Korean firms are coming in to the country with their investment plans and many of their products will be exported to Korea, said Mostafa Kamal, president of the Korea-Bangladesh Chamber of Commerce and Industry.
“So, the trade gap will reduce in the years to come,” he said, adding that South Korean Prime Minister Lee Nak-yeon, who is in Dhaka on a three-day visit, will hold meetings with the Bangladeshi business community today.
Bangladesh’s export to South Korea is on the rise but the trade gap is still heavily tilted towards the Asian economic giant.
In fiscal 2008-09, Bangladesh’s exports to Korea stood at $101.28 million, which soared to $254.84 million a decade later, according to data from the Export Promotion Bureau.
And in the first 11 months of the last fiscal year it stood at $348 million.
In contrast, Korea’s exports to Bangladesh in fiscal 2017-18 stood at $1.2 billion, up from $864.78 million a decade earlier.
Bangladesh mainly exports apparel, frozen food, agri-products, chemicals, leather, raw jute and jute goods to South Korea.
It imports iron and steel, ships, boats and floating structures, paper and paperboard, paper pulp, plastics, plastering materials, lime cement, nuclear reactor, machinery and mechanical appliances, electrical machinery and equipment and parts thereof, electronic products like television, air conditioner, mobile handsets, cotton and fabrics.
“The growth in Bangladesh’s exports to South Korea is definitely impressive but the volume of shipment is still too low in comparison to the imports,” said Khondker Golam Moazzem, research director of the Centre for Policy Dialogue, a leading think tank.
Subsequently, he suggested establishing a comprehensive partnership on trade and investment and technical cooperation between the two nations.
During a recent call-on with Commerce Minister Tipu Munshi, South Korean Ambassador in Dhaka Hu Kang-il conveyed his country’s business community’s keen interest in the power, infrastructure and some other sectors in Bangladesh.
South Korean business giant Hyundai Group also expressed its interest to the Bangladesh Economic Zones Authority to invest in the power and energy sector.