Openness brings more investment

The Daily Star: Sweden has been a long time friend and development partner of Bangladesh. What do you think are the major barriers to development here?

Johan Frisell: Bangladesh started from a very difficult position. The Swedish government has been supporting primary education, primary health, population control, rural development, etc. in Bangladesh. Many basic obstacles have been removed but there are still obstacles. 

I think Bangladesh needs a proper tax system for generation of income for the government. Tax should be set at the minimum for the poorest, for the middle class it should be larger, and for the richest it should be quite substantial. The government needs to have its own budget. And it is also time to ensure equal distribution of wealth. So how we design development is really important. 

The Swedish experience of development is, if you have no barriers to free trade, anyone can invest, anyone can import and export goods and services. You might think that for the short term this will be a problem because if you open up your market, there will be a lot of import from India and China and all over. How will your own industry survive? But in the medium to the long run, this will be beneficial because this openness will also attract investments, good ideas. The RMG sector has been so successful here because there was no restriction; anyone could come and import and export and set up factories. So go for free trade, go for open market. 

Right now I think the single most important factor to get economic growth and to end poverty in Bangladesh is to get women into the workforce. Even now in Bangladesh, only a small segment of women are actually working outside their homes. If they have a formal job and income, it would mean that tens of millions of people who are now staying at home will enter the workforce. Currently, growth in Bangladesh stands at approximately 6 percent per year. If you put women into the workforce, I think you will automatically add another 2 percent to that. So gender equality, women's participation in the workforce is a key factor. 

You also need to ensure a transparent, tolerant and democratic society where you have fair elections and the government is accountable. If the government does something wrong, if it invests in the wrong direction and people realise that this has not been a good policy, in the next election people must have the opportunity to vote for another party. In most countries where we have seen good development, we have seen this shift. We have seen this shift in Bangladesh as well. You have to continue with that.

TDS: How would you evaluate the investment climate of Bangladesh? Could you talk about some Swedish investment plans here? 

JF: Investment conditions in Bangladesh are basically good. We have several Swedish companies who have invested here -- some in production, some in service, and some have invested capital. One area where I think there is need for improvement is protection of investment. Here Bangladeshi legislation is not yet adequately developed. 

There are a couple of Swedish companies who have done very well here. The clothing company H&M is currently the single largest buyer of RMG from Bangladesh. IKEA is another company. These two companies have come, explored and decided to invest and stay here. I think there are many more Swedish companies who could do the same.

I am trying to visit Swedish companies in Sweden and elsewhere to make them see the opportunities of investing and trading with Bangladesh. We are changing slowly from a relationship that is more development oriented into a relationship that is more trade and investment based.

TDS: Tell us about your experiences of working with government bodies in Bangladesh. 

JF: Working with government bodies takes place at different levels. At the top level, I have dialogues with ministers, state ministers and secretaries on important aspects of our development relations as well as our trade and investment relations. And I am received very well. They are very open, kind and welcome discussions and cooperation. 

But sometimes bureaucracy is slow. It takes a long time to get a visa. I want the government to make sure that all those who are investing here face no problems with visas. I hear that a lot of businessmen get extension for one year only. After that, they have to leave and apply again, which is a long and tedious process. So I would like to see a change here.

We have Swedish companies who are fighting with the customs on different tariffs and so on. And there is corruption. I don't see it for myself but I read a lot about it. So corruption is something that slows down the speed of service. It is hampering development. But there is room for improvement. 

TDS: In your view, what are some of the projects that have been the most successful in Bangladesh? 

JF: First, I would say rural development projects. We did a lot of rural development in the first 20 to 25 years -- local engineering, building roads and villages, etc. We are one of the core funders of the large government programmes on primary education. And we have seen very good results in enrollment of children in the first grade. The third would be general health. We have worked to extend basic health services even at the upazila and union levels. And within the health sector, we are also working in one particular sector, which is sexual and reproductive health. This covers everything starting from pre-natal care to natal care afterwards, vaccination, taking care of kids, etc.

One of our most important policies now is to support Bangladesh to create midwives. This is a specialised profession only devoted to sexual and reproductive health. Around three thousand young women will be educated in the nursing colleges around the country to become midwives. And in December 2015, the first batch of midwives will be ready. Then the government of Bangladesh will be able to send out qualified midwives throughout the country. We have midwife staff here in Bangladesh to help setup a curriculum for education. It will further reduce child mortality. 

TDS: What are some of the areas that need more attention?

JF: Infrastructure, roads, railways, energy, urban planning, etc. are some areas that need attention. Dhaka now has 16 million inhabitants. The World Bank believes that in fifteen years, there will be 27 million people living in Dhaka. So you need forceful urban planning. If the population is going to be increased from 16 million to 27 million, most of them will land in slums. How you would approach that might be one of the biggest challenges for Bangladesh in the coming 10 to 15 years. 

TDS: Any final words?

JF: Since I came here, I have been travelling a little bit and I see that some people feel they are left out of the big equation. This is a country with a government which is investing a lot in development. But there are small groups of people who do not entirely feel like a part of this mass movement. You have to make sure that there is a place for everyone – be it minorities or ethnic groups or stranded Pakistanis. You also have to take care of the religious minorities -- Christians, Buddhists, Hindus­­. Right now I see that non-religious groups like secular bloggers are facing a very difficult time. Clearly, the majority of the population is the Bengali speaking Muslims. But there is so much variety and diversity in this society which, I think, is very important to retain. I would like to see Bangladesh as an open, pluralistic and tolerant society where there is a place for everyone.