The former military dictator has an interesting take on his role in the establishment of Grameen Bank.  He writes in today’s Daily Star:

Grameen Bank Ordinance was promulgated by me to establish Grameen Bank on September 4, 1983 when I had had barely completed my first year in office. One should understand how busy I was during those days.

and

My government allocated resources for Grameen Bank for its expansion program to cover the entire country at very generous terms, mostly, if I remember correctly, with aid funds from Sweden, Norway and Canada.

and

I did this deliberately so that Grameen Bank could provide loans to the poor at a rate that was affordable to the poor at 9-10%. I was assured by Grameen Bank that interest rate would be lowered to the desired level, when the expansion program ended in 1992. But over the years the interest rate went up from 13% in 1983 to 20% after I left office

Ershad is basically saying he was far seeing enough to realise what a good thing Grameen was and would be and thus he facilitated the way for Grameen through his unique “Grameen ordnance.”  He also deftly manages to remove himself from the widely criticised interest rates charged by Grameen!

Another take on this history would be that Grameen did not want to register as a bank or a cooperative. Yunus was able to do his usual politicking to milk the situation. Ershad, as a new military dictator, was keen on promoting a more humane image of his regime. And Yunus needed Ershad’s help to set his enterprise up as a parastatal agency overseen by a board made up of himself, state officials and a larger group of Bank clients. Yunus and Ershad needed to scratch each other’s backs and they did.

What is not just irksome but downright unethical is to give an article a big headline like “The Modern Face of Slavery” and then follow it up with some initial text bristling with buzz words like bonded labour AND THEN fizzle out into nothing. No information. No references. Just a couple of interviews on this most incredible of issues.

So, with all that in mind, this is HOW NOT TO WRITE an article about modern slavery.

Professor Chowdhury reminds us of a key aspect of the garment industry: outside forces.

The garment industry is the only area where Bangladesh could claim considerable success. Today garment export is the main source of foreign exchange earnings for the country after remittances. Its success was not necessarily influenced by government policy but essentially by outside forces. This industry had its origin in the 1970s when the investors of other South East Asian nations ventured to set up garment factories in Bangladesh to work around the export quotas imposed on their native countries by the United States. Later, Bangladeshi entrepreneurs rushed to establish their own companies, some with little or no experience. After a period of adjustments, the industry began to stabilize and started to grow, and has eventually earned the world’s respect.

Thus, the stabilization and growth of the garment industry in Bangladesh was achieved largely with the help and intervention of foreign investors who supplied expert technical support for its quality control and had an effective marketing plan. Additionally, the country enjoyed a favorable quota system from the United States for quite a while. But this situation is now changing as other least developing countries gain trade advantage for their manufactured garments from the United States.

Notions that Scandos have progressive and enlightened labour policies are continuing to take a battering. Following on from my earlier post where I described Tom Heinemann’s documentary about working conditions for Bangladeshi workers doing contract work for Telenor and Grameen, there seems to be more bad news for the parent company:

Telenor’s Labour Scandal Deepens

Two more workers’ deaths linked to Telenor

Jon Fredrik Baksaas of Telenor in a grinning competition with Mohammed Yunus.

A minority of regular readers of this blog will be fed up with my …er…concern about Professor Yunus in past posts. ( Just search Yunus in the search box..!!) If you are one such reader, then I request you to close your browser or surf to the Disney site because the story below is as nasty as it gets:

A Danish documentary will tonight reveal “miserable working conditions and environmental violations at companies in Bangladesh that act as suppliers to GrameenPhone ….co-owned by Norwegian telecoms firm Telenor and firms founded by Nobel Peace Prize winner Muhammad Yunus.”

The documentary was made by made by Danish journalist Tom Heinemann and is to be aired on Norwegian Broadcasting (NRK) tonight.

The documentary shows:

* Employees working with hazardous chemicals and heavy metals virtually without protection.
* that workers were as young as 13 years, a clear violation of child labour laws. The firms were caught allowing polluted wastewater to spill into nearby rice fields.
* the death of a worker killed when he fell into an unsecured pool of acid.

The report in this Norwegian publication says :

Telenor officials claim they were shaken by the documentary’s findings, and admit they failed to adequately monitor the operations of GrameenPhone’s suppliers

See a trailer of the film here.

Tom Heinemann is an established journalist with a formidable track-record. In 2005/6 he made a documentary about the harsh working conditions of Indian workers producing for the Scandinavian market. The film is called “A Killer Bargain.” Heinemann’s primary concern is to reveal the stark realities of globalisation  in the developing world.

You will find more about Telenor in the comments section of this post of mine on Professor Yunus.

Here is a delicately written Economist article which pulls the rug from under nobel laureate Yunus’ feet. You remember the Danone thing where the good Professor, always a man for stunts,  invited the great Zinedine Zidane to Bangladesh? The article deals with the business model inherent in that set up and compares it to other approaches,  namely a book by Paul Polak.  And the article sticks the boot in….but oh ever so subtly.  Some excerpts:

In his new book, Mr Yunus describes how Grameen and Danone agreed on a joint venture to sell nutritious food to the poor. It is a wholesome tale of French businessmen finding meaning in their lives, and Bangladeshi children enjoying something better than rice gruel to eat. But Mr Yunus also smothers the story in molasses, making claims about the originality and profundity of the enterprise that are simply too rich to take.

And the absurdity of Yunus’ hyperbole is collapsed like a house of cards:

However tasty and nutritious the yogurt they eat, the poor will not consume their way out of poverty. To escape, they must find a way to make more money. This simple truth is repeated by Paul Polak, the founder of International Development Enterprises (IDE), in “Out of Poverty”, his wise and engaging new book.

Rub your hands all those of you with apartments in Gulshan…here is another giant moving into Bangladesh and driving up your property prices. Forbes reports that Vodafone is “looking at a number of options including the acquisition of any of the six mobile phone companies now operating in the country…We are excited by the growth possibilities in Bangladesh.” Oh yes….so are a lot of property owning NRBs!

Great I say if it helps reduces call charges. I don’t know what the situation is now, but even as recently as 2004 Bangladesh had the highest ( ie most expensive) call rates anywhere in South Asia and there were consumer protests about this including a demonstration if i remember rightly. The impact of liberalisation was overwhelmingly adverse for the consumer. The sequential release of licenses helped the first guys to make super profits and monopolise the entire sector. However things are changing. The regulator (BTRC) has recently been praised for price capping and other measures but derided (by Joe Bloggs at least) for proscribing VoIP.

Someone now needs to tell Steve Jobs that as the market for BMWs is now limited in the country ( chuckle, chuckle) “in the face of the government’s anti-corruption drive” - not a single damn sale last year - there must be a lot of cash floating about. And the iPhone is nowhere near as conspicuous as the 5 series. Potential owners can even hide it in their lungis?

Tags: Technology Investment Bangladesh Apple iPhone Vodafone

The sweet scent of moolah is bringing the great and the good ( or the rich and the bad if you prefer) to New York city for a conference entitled “Updated Investment Opportunities in Bangladesh.” The Asia Society is holding a panel discussion called “Bangladesh: Untapped Opportunities.” Here is the exciting blurb:

The Word Bank calls it the Bangladesh Paradox. The Bangladesh economy has steadily accelerated in recent years, with growth reaching 7% in 2006. The country scores particularly well on socio-economic indicators. Global banks and multilateral institutions present a highly optimistic outlook: Citi, Goldman Sachs, JPMorgan and Merrill Lynch have identified Bangladesh as a key investment opportunity. This impressive growth occurs in a climate of political restructuring. A caretaker government is implementing reforms toward privatizing many state-owned enterprises. The Dhaka Stock Exchange Index is at a 10-year high, up 66 percent this year, making it Asia’s top performer after China. And the stock market is expected to double in size in 2008.

Discover why market-oriented reforms, strong socio-economic indicators and highly favorable demographics are poised to render Bangladesh one of the world’s most exciting investment opportunities.

Buoyed by the inclusion of Bangladesh in J P Morgan’s “Frontier Five” group of countries and also Goldman Sach’s “Next Eleven” group, Asian Tiger Capital Partners have launched themselves in Bangladesh complete with a bengal tiger as logo. Their blurb goes like this

I read more of their interim web site and find that they want to invest in companies with a strong domestic and foreign presence and also create joint ventures in sectors such as outsourcing. There are not many indicators what these companies are. I would have also thought there is an assurance problem here…and am quite surprised to learn that the World Bank ranks Bangladesh higher than India in terms of “Investor Protection.” The political analysis of Bangladesh is a little …em…glossy but this site is certainly one to watch though.

That has to be the quote of the week by Foreign Adviser Iftikhar Ahmed Chowdhury. Apparently the Russians are going to help develop nuclear energy in Bangladesh. “All countries do not like to extend nuclear cooperation. Russia has the appropriate technology for it.”  Yes tell that to the Ukrainians, Mr Chowdhury, and they might remind you about a nuclear plant called Chernobyl. But yes, unquestionably, energy policy and energy development should be top priority for any administration and especially so after Kansat last year.

From my apartment on the fourth floor of a block on Road No 35 -undoubtedly the most socially and politically interesting road in Gulshan - I can not only see the new 5 star hotel in town but I can hear it too. Yes noise pollution is of no concern for the shiny and glitzy Westin. “Driver Musharraf, Driver Musharaff” followed by a little jingle and on and on it goes throughout the day and evening as each chauffeur is called to the surface from the underground car park.

Still, I decided I should go and patronise the place being as it is less than 2 minutes from my block by foot. You have to do a little mental moral calculation though - the owner Noor Ali is an ex communist party member (no problem in that but read on), and has recently hit the headlines when he accused Hasina of extortion ( no problem in that) and is a businessman who made the bulk of his money through labour recruitment to Saudi ( big fat mother of all problems there). Aren’t commies supposed to be pro-labour? Nevertheless, goaded by stories of how lovely the female staff are, I thought I had better get there pronto.

My friend and I were given a tour of the place by very customer oriented staff. I have stayed at the Sheraton and Sonargaon but neither come close to this. Inspired by Singaporean hotel management, I am pretty sure, even down to the decor I was quite impressed by the place.

The gym and pool are high tech and very pleasant indeed. The membership is a staggering 125,000 taka per year, and yet despite this the majority of the members are not foreigners. You can utilise the facilities on a one-off basis for 25,000. My friend’s World Bank outfit I understand gets a corporate discount.

The rooms are apparently all bigger than the competitor hotels, and get this - this is the only 5 star hotel in the world with all plasma/lcd tvs in all rooms and reception areas.

We ended the evening with a meal in their buffet bar. All of Gulshan’s elite had arrived by the looks of it, including the Foregin Adviser and some well known artistes and constitutional lawyers. Again the South/Far East Asian emphasis was welcome and superbly done. The staff attentiveness was quite something. If you are like me and keep dropping your napkin between your legs and onto the floor and hate bending down to retrieve it - no problem, a waiter will spot it within seconds and bring a fresh one instantly!

Crits? Well there is no greenery outside and the orchids inside are not quite Singaporean standard. And of course there is the noise…why do Starwoods and Westin think they can pollute the environment like this? Cos they are in Dhaka?

He brought Zinedine Zidane to the country and now Asia’s biggest sensation, Mohammad Yunus, is to support Bangladesh Women’s Football Association.

Initially, it was really tough for us to convince Muslim girls and get them involved in the game of football. Amidst that, we used to constantly face threats from a fundamentalist group, asking us to stop. The situation has changed a lot now. When we started, we saw good responses from six districts. Today, it’s gone up to 10. We have participated in two editions of Asian Football Confederation (AFC) conducted international U-17 championships. What we need however is the support on the financial front for ground infrastructure and organisation.

Lists are usually quite boring but check this one. These are the prominent brand name products currently being manufactured in the republic of Bangladesh!

Nike, Reebok, Lafuma, H and M, Gap, J.C.Penny, Walmart, KMart, OSPIG (Germany), Mother Care, Lee, Wrangler, Dockers, NAB, Tommy Hilfiger, Out Door, Adidas, Flacon (USA), Edie Bauyer, Eagle, Releigh(UK), Emmilee, Free Spiril (UK), Miles (Germany), Brouks, American Eagle, Hi-tech (UK) Decathlon, Phillip-Maurice (UK), Federated, Styles Co, Sag Harbour (USA).

Camera Lens (IO Parts) - Konika, Minolta
Golf Shafts - Abu Garcia
Mobile Parts - Sony
Automobile Parts - Nissan, Mitsubishi, Hino

Source: from a Bangladesh Export Processing Zone Authority document given to me in a recent visit I made a month ago to film their head - Brigadier General Ashraf.