Japanese companies are diversifying their supply chain as the country is providing them with incentives to move manufacturing facilities away from China to other regional countries, including, Bangladesh.
Japan’s ambassador to Bangladesh Naoki Ito noted the vast opportunity for Bangladesh, especially, as it develops the $1bn Special Economic Zone to begin operating in 2022, according to media reports. The zone is expected to lure $20bn in Japanese business into its 1,000 acres in the Araihazar subdistrict about 20 miles from Dhaka. Japan has earmarked $350mn in special loans to develop the region.
Japan Tobacco and Honda are two of the largest Japanese investors in the South Asian country, reports indicated. New investments are also expected from Suzuki Motor and Mitsubishi. An important infrastructure is a deep-sea port in Matarbari Island.
Bangladesh is a fast-growing economy that will be the 24th largest economy in the world by 2030 per reports. At present, Bangladesh consumes about 4.5-5mn mt of scrap with about 1mn mt generated locally. In the next few years, the country will increase its steelmaking capacity to 10-11mn mt annually with the addition of 3-4mn mt in planned developments.