paris - feb2006 bangladesh private sector forum 1 mamdood hossain alamgir director, board of...

1 PARIS - FEB2006

Bangladesh Private Sector Forum

Mamdood Hossain AlamgirDirector, Board of Investment

Prime Minister’s Office, Bangladesh&

Mamun RashidCEO, Citibank N.A., Bangladesh

Country Case Study: Bangladesh

Bangladesh Private Sector ForumB A C K G R O U N D A N D S T R A T E G I E S

2 PARIS - FEB2006


Presentation Plan• Emergence of Private Sector• The Context of BPSF• Objectives of BPSF • Structure and Participation• Outreach Strategies• Monitoring Mechanisms• Projected Results• Challenges

Participation/QA

3 PARIS - FEB2006


Emergence

of Private Sector

.

4 PARIS - FEB2006


Emergence of Private Sector

Bangladesh has successfully moved forward to market economy despite its emergence as a socialistic economy during independence in 1971.

Private Sector is becoming a vibrant force in the economy.

For the first time, country’s GDP growth is expected to reach 6.5% this year, highest growth since 1972.

For the 2nd time in the country’s history, manufacturing growth touched double digit in last quarter.

76% of the total investment is by the Private sector and represent 18.5% of GDP.

FDI inflow significantly reached to US$ 0.8 billion in 2005.

5 PARIS - FEB2006


Emergence of Private Sector

Lets see some figures …

6 PARIS - FEB2006


Source: Bangladesh Economic Review 2004 and Bangladesh Bank

6.50%6.27%

5.26%

4.42%

5.27%

5.94%

4.87%5.23%

4.62%

5.39%

4.57%4.92%

4.08%

5.04%5.38%

1991-92

1992-93

1993-94

1994-95

1995-96

1996-97

1997-98

1998-99

1999-2000

2000-01

2001-02

2002-03

2003-04

2004-05

2005-06p

Consistent GDP Growth (%)

Bangladesh: Socio-Economic Indicators

7 PARIS - FEB2006


Investment as % of GDP

Source: Bangladesh Economic Review 2005

24.423.623.423.123.123.022.2

5.96.7 7.4 7.2 6.4 6.2 6.1

18.517.517.216.815.815.5 15.6

1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05

Total Investment Public Private

Bangladesh: Socio-Economic Indicators

8 PARIS - FEB2006


Source: Bangladesh Economic Review 2005 and ADB

4.92%

6.17%

7.44%6.53%

7.26% 7.60%8.60% 9.50%

1998-99 1999-2000 2000-01 2001-2002 2002-2003 2003-2004 2004-2005 2006-2006p

Upward Industrial Trend (%)

Bangladesh : Socio-Economic Indicators

9 PARIS - FEB2006


Source: Bangladesh Economic Review 2005

7.38

8.628.15

10.48

6.41

5.05

8.58

3.19

4.76

6.68

5.48

6.75 7.10

8.43

10.50

1991-1992

1992-1993

1993-1994

1994-1995

1995-1996

1996-1997

1997-1998

1998-1999

1999-2000

2000-2001

2001-2002

2002-2003

2003-2004

2004-2005

2005-06p

Manufacturing Growth (%)


10 PARIS - FEB2006


Source: Bangladesh Economic Review 2005 and EPB 2006

5,324 5,7526,467 5,986 6,548

7,603

8,655

10,159

1998-1999 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006t

Export Growth (Million US$)


11 PARIS - FEB2006


Actual FDI Inflow (Million US$)

Source: World Investment Report 2005, Bangladesh Bank and BOIP= Projected, t=target

In Million US$

190 180 28079 52

268460

800

1,000

1998 1999 2000 2001 2002 2003 2004 2005p 2006t


12 PARIS - FEB2006


The Context

of BPSF

.

13 PARIS - FEB2006


The Context of BPSF

Private sector participation in the policy formulation process in Bangladesh began in ‘80s, but in an ad hoc basis.

This includes consultation with the business chambers, sectoral industry associations, temporary policy fora, representation in various committees etc.

However, the recent robust growth of the private sector demands a formal strategic framework to ensure its participation in the processes.

14 PARIS - FEB2006


The Context of BPSF

In early 2005 the Government of Bangladesh formally embarked on a long-term program of private sector development through a combination of institutional and regulatory reform, a strengthened economic zone strategy and the creation of a special economic zone.

At the centre of the process is the ongoing preparation of a large ($150-$200m) World Bank-led, multi-donor-funded PSD project which is scheduled for commencement in mid-2006.

A year-long “design phase” which includes a large number (around 30) of preparatory projects is underway and is being led by the IFC, FIAS and the SEDF.

15 PARIS - FEB2006


The Context of BPSF

To assist in the preparation of the proposed Private Sector Development Support Project (PSDSP), the Government of Bangladesh has established several groups.

Under the Prime Minister’s Office, the Government has formed the Private Sector Development Task Force whose membership is made up of permanent secretaries and agency heads.

In addition to the PSD Task Force, the Government has also established the PSD Core Group, which consists of around 37 senior working-level civil servants.

16 PARIS - FEB2006


The Context of BPSF

Complementing this is the Private Sector Consultative Group (PSCG), which is made up of approximately 25 leading private sector representatives.

The PSCG is continuing to supply private sector inputs to the reform process that has been initiated.

These various groups have collectively already started an ongoing series of public-private dialogue and are meeting jointly every one or two months, including in the form of dedicated working groups covering specific topics.

17 PARIS - FEB2006


The Context of BPSF

Three Working Groups have been formed, focusing on Regulatory Reform, Special Economic Zones and Capacity Building.

The working groups are composed of members of the PSD Task Force, the PSCG and the PSD Core Group.

The Working Groups are chaired jointly by a member of the PSD Task Force and a member of the PSCG, in order to provide inputs from both groups of stakeholders.

The Working Groups have each produced a brief note on their thematic areas, and these papers have been instrumental in the design of the proposed PSDSP.

18 PARIS - FEB2006


Objectives

of BPSF

.

19 PARIS - FEB2006


Objectives of BPSF

The current mechanism for dialogue which has been established to help prepare the proposed PSDSP and to support the PSD reform agenda has proven to be an excellent platform for public-private discussions.

As a result of this extensive process, the Government has asked the Development Partners Support Group to consider establishing a more formalized and permanent mechanism for private sector-public sector dialogue.

20 PARIS - FEB2006


Structure and

Participation

.

21 PARIS - FEB2006


Structure and Participation

Possibly to be known as the Bangladesh Private Sector Forum (PSF), all of the PSD Task Force, PSD Core Group, PSCG and DPSG will be asked to play a role.

It is proposed that these groups come together to form the Private Sector Forum in the second quarter of 2006 after the bulk of the PSDSP preparation has taken place and ahead of project effectiveness.

These groups will need to be augmented by a permanent secretariat which will schedule meetings, set agendas, and follow-up on recommendations. The Prime Minister is expected to serve as patron.

22 PARIS - FEB2006


Outreach

Strategies

.

23 PARIS - FEB2006


Outreach Strategies

In order to ensure success, the PSF must incorporate the inputs of a wide and diverse range of private sector representatives.

The PSF must also ensure that it takes a national approach instead of a regional approach; therefore, private sector representatives need to be drawn from across the nation.

24 PARIS - FEB2006


Monitoring

Mechanisms

.

25 PARIS - FEB2006


Monitoring Mechanisms

The PSDSP itself will have a Monitoring and Evaluation Framework.

The PSF will be connected to the regulatory reform program of the proposed BICF and PSDSP.

Interactions of the PSF will be monitored by the members of the DPSG, through the proposed BICF.

International experts may also be brought in to the meetings of the PSF to facilitate discussions and design solutions, if requested by the Government.

26 PARIS - FEB2006


Projected

Results

.

27 PARIS - FEB2006


Projected Results

Through a process of continued, results-focused dialogue, the main targeted outcome of the PSF will be a growing Bangladeshi private sector achieved through an improved investment climate characterized by an ongoing process of regulatory reform.

The PSF will seek to develop a critical path for regulatory reform and growth based on inputs to, and recommendations from, the membership of the PSF.

The PSF will be closely aligned to the work of the proposed PSDSP and any additional technical assistance operations that may be formed to support that.

28 PARIS - FEB2006


Challenges

.

29 PARIS - FEB2006


Challenges

Political will and commitment is a must for success.

The PSF must aim to take a nonpartisan approach, in order to ensure success amidst political change.

The recommendations of the PSF must be implemented as soon as possible, in order to ensure success.

The PSF must aim to benefit from the experiences and lessons of other countries presented at this workshop in order to be most effective.

30 PARIS - FEB2006


P A R T I C I P A T I O N/Q&A

31 PARIS - FEB2006


Thank You

Thank You

paris - feb2006 bangladesh private sector forum 1 mamdood hossain alamgir director, board of...

Documents