Japanese companies, operating in Bangladesh, is expected to bounce back from the impact of Covid-19 within this year since, indicates a study of JETRO.
The study of Japan External Trade Organization (JETRO), shows that nine percent Japanese companies have already recovered from Covid-19 impact while 31.3 percent is expected to return to normal in “first half of 2021” and 34.3 percent in the “second half of 2021”.
JETRO, an independent administrative institution established by Japan Export Trade Research Organization as a non-profit corporation in Osaka, conducted the survey on ‘Business Condition of Japanese Companies in Asia and Oceania’ for 2020.
Referring the recent survey, JETRO Country Representative Yuji Ando said the changes in the trading environments of Bangladesh had a positive impact on business performance (year-on-year increase).
He mentioned that many respondents of the survey said the shift of production to their countries caused by the US-China trade frictions had a positive impact for the country.
He said Bangladesh is one of the major destinations for Japanese entrepreneurs and they are investing in different fields, including ready-made garments (RMG), textile, IT and infrastructure taking the advantage of competitive human resource and huge domestic market.
“The number of Japanese companies operating in Bangladesh has increased around four times in 10 years. A total of 321 Japanese firms are currently running their businesses in the country which was 83 in 2010,” he mentioned.
He informed that many Japanese entrepreneurs are expanding their businesses in different fields, including electric and consumer products, of the country.
Yuji Ando said Bangladesh has the potential to develop businesses but needs to improve environment bottlenecks.
He said investors face different hassles like time consuming customs procedures, difficulty in local procurement of raw materials and components, power shortages and wage hikes.
As per the survey of the JETRO, Japanese companies feel that “difficulties in local procurement of raw materials and parts” (66.7 percent) and “custom procedures” (56.1 percent) are major challenges in their businesses.
The pandemic is showing no signs of abating but still 41.8 per cent of Japanese companies in Bangladesh during 2020 wanted to expand business in the next two years. In 2020, another 49.3 per cent believed that their operations will remain the same while 6 per cent pondered over going for retrenching.
Besides, 3 per cent wanted to shift to another country withdrawing investments, failing to bear the difficulties of the ongoing Covid-19 fallouts.