1. 8th China-South Asia Business Forum: Private Enterprises Going Global
Md. Sabur Khan, President
Dhaka Chamber of Commerce & Industry (DCCI)
Kunming, China
June 7, 2013

2. 8th China-South Asia Business Forum (SABF)
China-SABF
an important cooperation platform between Chambers of Commerce and Industry both of China and South Asian Countries. regional economic cooperation between Chinese and SAARC Industrial and Commercial circles.

3. Importance of China-SABF
SAARC and China account for approximately one third of the global population.
SAARC accounts for 4.5% of total global trade.
China accounts for -----% of total global trade.
Trade and business between China and SAARC has been increasing day by day.

4. China-SABF Trade
&
Investment Relations

5. SAARC Imports from China
Year
Amount in Mn US$
2003
7500
2004
12500
2005
17500
2006
24000
2007
36500
2008
45000
2009
42000
2010
58000
Source: IMF Direction of Trade Online Statistics,

6. SAARC Exports to China
Year
Amount in Mn US$
2003
5000
2004
8000
2005
1000
2006
12000
2007
15000
2008
21500
2009
2010
23000
Source: IMF Direction of Trade Online Statistics,

7. Investment of China to SAARC
Year
Million US$
2008
1600
2009
750
2010
2760
2011
4020
Source:

8. Bangladesh-China
Trade and Business
Relation

9. Import of Bangladesh from China
Year
Amount (Million US$)
% of Total Import
5906 20
3790
17.7
3418
15.18
3136
14.35
2572
14.98
Source: Bangladesh Bank

10. Export of Bangladesh to China
Year
Amount (Million US$)
% of Total Export
319
1.39
179
1.10 97
0.62
107
0.76 93
Source: Export Promotion Bureau

11. Exports and Imports share of Major Trade Groups (%)
Year/Trade Groups
APTA
ASEAN
SAARC EU
APEC
NAFTA
2006
Exports
11.83
6.35
1.31
37.82
45.07
13.84
Imports
10.52
5.55
1.92
38.21
47.19
20.55
2007
12.58
6.20
1.33
38.20
44.48
13.27
10.95
5.45
2.0
38.64
45.69
18.99
2008
12.81
6.26
1.39
36.65
44.21
12.76
11.63
5.8
2.31
37.42
45.51
17.69
2009
14.00
6.5
1.65
36.58
45.05
12.77
5.75
2.60
36.56
45.50
17.22
2010
15.13
6.93
1.80
33.93
47.66
12.93
14.28
2.73
34.21
48.26
17.43
Source: UNCTAD Handbook of Statistics-2011

12. Position of Bangladesh
Among SAARC

13. Export of Bangladesh to SAARC Countries in 2010-11
Amount in Mn.US$
Percentage(%)
India
512.50
78.55
Pakistan
86.79
13.30
Sri Lanka
34.73
5.32
Nepal
10.84
1.67
Afghanistan
3.5
0.54
Bhutan
3.12
0.47
Maldives
0.92
0.15
Source: Export Promotion Bureau

14. Import of Bangladesh from SAARC Countries in 2010-11
Amount (Mn. US$)
Percentage (%)
India
85.41
Pakistan
670.81
12.55
Nepal
48.46
0.90
Sri Lanka
27.57
0.52
Bhutan
18.58
0.34
Afghanistan
12.62
0.23
Maldives
1.5
0.02
Source: Bangladesh Bank

15. Globalization and Private Sector
The tremendous speed and the wide range for moving real and financial capital made the private business sector consider the whole world as the field for its operations and reorganize its capital and changes its production locations. The private sector is the center of the global economy, while all the other sectors are still far, even though they are connected. This resulted in rapid growth of production and employment in some parts of the world, but on the other hand, it also caused increasing inequalities between countries, and within the countries themselves, and the financial crises of South East Asia, and the collapse of the average standard of living in parts of the ex- Soviet Union and in Sub-Saharan Africa.

16. Driving forces of globalization
Private sector emphasis
increased private sector activity powered by measures such as privatization and tax reduction;
Public deregulation
lowering of government-imposed regulatory barriers which have formerly impeded market entry;
Technological changes
significant reduction of costs to enter international markets and expand respective activities.

17. South Asian Companies Going Global
According to a report published by The Boston Consulting Group (BCG), more than fifty companies of the Southeast Asia have been rapidly expanding and competing in the Asian and global economy, and throwing a spotlight on a region that has experienced an economic renaissance
These companies range in size from US$ 500 million to US$ 63 billion in annual sales.
Among them Malaysia and Indonesia each have 12 companies on the list;
Singapore and Thailand each have 11 on the list;
The Philippines and Vietnam each have 2 on the list;
11 Companies from the food and beverage and 8 agricultural-commodity industries are most represented on the list,
The real estate and construction, transportation and logistics, and utilities industries each represent 4 four companies on the list.

18. South Asian Companies Going Global
While China and India have been receiving most of the headlines over the past ten years, many Southeast Asia companies have been quietly and confidently creating international businesses. The success of the Southeast Asia challengers and the region they represent is one of the world’s best-kept secrets. Southeast Asia is becoming a fast integrated region, with Singapore as the hub of financial and logistics activity and an example to other nations of what they might achieve.

19. South Asian Companies Going Global
Today, the region is on much stronger footing. For example, the capital ratio of banks—a measure of their ability to withstand losses—is much higher today than prior to the Asian financial crisis. Among banks headquartered in emerging markets, Southeast Asia recorded some of the highest total shareholder returns between 2005 and These structural improvements helped Southeast Asia weather the recent global crisis better than most other regions.

20. Advantages of Private Enterprises Going Global
Access to new customers and markets
Globalization offers growth opportunities and a larger growth potential than the domestic market;
Cost efficiency and competitiveness
Better access to suppliers and materials
Reduce risks
Develop and sell new products and services

21. Impediments to Internationalization
Financial factors,
Regulation/bureaucracy,
Language/cultural parameters,
Engineering and technical capability;
Competitive concerns,
Managing Income Tax Implications
Management capability and resources (difficulty to find the adequate senior management )
Transport/logistics problems;
Currency problems;
Political risks

22. Way Forward
Internationally minded people should be hired for globalized business.
Cooperation with an international network might be a clever idea to improve the quality of the relationship with the global counterparts.
Information should be gathered about the targeted country
A collaborative approach to the issues of poverty alleviation and disaster relief, as well as an attempt at promoting a multilateral human resources training program, bilateral infrastructure development and bilateral energy cooperation can be done through the integration of China with South Asian countries and internationalization of private enterprises.

23. Way Forward, Cont…
Some measures may be taken to improve China-SAARC trade such as: removal of non-tariff and Para-tariff barriers, the granting of preferential market access to South Asian states and the relocation of labor-intensive industries from China to South Asia.
Some measures may also be taken to improve investment such as the sharing of information and the exchange of fact-finding missions to uncover potential investment opportunities, investment in infrastructure-building projects and a general increase in investment flows from China to South Asia.

24. Way Forward, Cont…
SAARC not only lacks the resources to initiate meaningful projects for regional integration and going global but also misses out on a large proportion of the spill-over benefits. China's engagement with SAARC could, therefore, address some of these shortfalls.
Successful transition from extreme poverty to impressive growth since the beginning of its market reforms in 1978 with the member states of SAARC, China nowadays is viewed as a desirable role model for the collectivity of South Asian states.
China's reduction of extreme poverty from 40% to 8% of its total population over the last two decades as being 'perhaps one of the wonders of the 21st century‘. So, China may help the region in this respect to reduce poverty level.

25. Concluding Remarks
If SAARC is truly to benefit from, for instance, Chinese investment in regional energy and infrastructure development projects, it must be prepared to take collective action to facilitate such initiatives.
Involvement of the civil society in policy-making and project development should be highlighted in furthering SAARC's interactions with China. Such efforts could go some way towards countering stagnation in official channels.
Chamber-to-Chamber relation among these countries should be strengthened.

26. Concluding Remarks Cont…
Most of the SAARC LDCs are suffering from supply side constraints – two important BRIC members, e.g. China and India could join hands to support LDCs.
An effective study can be commissioned to identify common areas of actions to move forward.
Secretariat of China-SABF should maintain close cooperation with all leading chambers of SAARC countries so that similar type of useful programs can be done throughout the year.

27. Thank You
Very Much