Risk Profile: Bangladesh
You can be confident of doing business in Bangladesh. The World Bank Group's annual report, "Doing Business 2011", has moved Bangladesh up four places since the publication of the 2010 findings.
Key areas of improvement are in the categories of starting a business, registering property, and closing a business. The country ranks overall at 107 out of 183 rated economies for overall ease of doing business.
Standard & Poor's (S&P) awarded Bangladesh a BB- sovereign credit rating in 2010 and Moody's Investor Service set its rating at Ba3. This was the first year the country obtained ratings from these two respected international credit agencies.
The sovereign credit rating is based on a thorough assessment of a national government's ability and willingness to repay local and foreign currency debts. These ratings indicate a strong level of confidence in the stability of the government.
Positive Economic Factors
Additional factors that influenced these ratings are the country's strong and stable economic growth in the previous 10 years. S&P based its rating on average real capital GDP growth of 4.2 percent and Moody's focused on average standard GDP growth of 6.0 percent as a major indicator.
Another positive indicator of stability and growth is that Bangladesh has been categorized by Goldman Sachs as having an economy that is equal to a small group of other fast growing emerging countries, such as Vietnam, Indonesia, Turkey and Philippines.
Consistent and stable economic growth is the result of several factors, including the strength of the readymade garments industrial sector and the continued and steady influx of money sent home by Bangladesh citizens who are working abroad.
The economic prognosis for the near future is positive. Bangladesh has never defaulted on repayment of its foreign debt. As a nation, it is a stable democracy and has been so for 20 years.
Anticipated diversification of exports and a subsequent decrease in reliance on the garment industry as the Information Technology (IT) outsourcing sector grows make it likely that the next round of sovereign credit ratings will show an uptick.
Based in Dhaka, Bangladesh, ServicEngine is one of the fastest growing companies providing total BPO and IT solutions for small and large businesses.
