Non traditional opportunities Asia & Pacific Region have been discussed

1. NON-TRADITIONAL OPPORTUNITIES IN
BUSINESS AND INVESTMENT in Asia-Pacific Region
With Specific Example of Bangladesh

2. Objectives
To highlight non traditional business opportunities and
responsible business practices in Asia and the Pacific
and to identify emerging opportunities and challenges
for business in less developed and landlocked
countries under its ongoing reform process

3. Asia-Pacific Business and Investment Prospects
• Asia-Pacific (AP) is the world's fastest growing region
which accounts for more than half the world’s
population, represents 55 percent of global GDP
and accounts for 44 percent of world trade.
• The AP region is in a good position to lead global
business, taking into consideration its vast market size,
immense resources, and the presence of developed
economies such as Japan and the United States, with
emerging economies, such as China and India.
• Such a phenomenon has led to call for the region to
have a louder and larger voice in international
fora and institutions.

4. • Increasing global awareness of climate change opens up new
business opportunities for innovative producers of AP to develop
and export non traditional goods and services, especially in the
areas of water, energy, IT&ITES, outsourcing, green business &
resource efficiency promotion.
• A supporting policy environment and sizeable investments are
necessary preconditions to become market leaders in this area.
• Developing AP economies have an abundance of cost efficient
labour for RMG, tourism, construction, transport services and other
labour intensive sectors.
• Some of these economies are also investing in creating the high-
skilled human capital necessary for the development of knowledge-
intensive services.
• The rapidly rising labour costs in fast-growing developing economies
such as China and India could be an incentive for manufacturers in
less developed economies to move up the industrial value chain.
Business opportunities in Asia-Pacific Region

5. • A traditional business plan can help many companies
make progress, but at present non-traditional business
practices offer unique advantages, as well as success
for companies of all sizes.
• Businesses as large as Google to those as small as a Call
Centre are some examples of Non-Traditional business
which are very successful globally.
• Successful non-traditional companies prove that business
does not have to follow a strict formula to produce high
profits.
Non-traditional Business & Investment

6. • Non-traditional Business & Investment allow small owners to
connect with people. It can be contributed to build
relationship through niche website with forum to engage in
discussions, ask questions and seek advice for innovation
• Increasing need for partnership between business and other
sector
• Wider benefit for society
• Increasing Utilization of Core business skills, resources,
assets and influences
• Greater benefits for business and therefore sustainability
for inclusive growth
• Definition and nature of non traditional opportunities and
business varies from country to country. (e.g., RMG for
Bangladesh is a non-traditional business but in other
country it may be traditional)
Nature of Non-traditional Business & Investment

7. Examples of non-traditional Business of AP
• Online Services like: Web hosting, Google, Yahoo etc.
• Telecommunication Business
• IT enable Services
• E-business, e-banking, e-commerce etc
• Outsourcing and Call Centre
• Public-Private Partnership
• Corporate Social Responsibility/Responsible business
practices
• Green Businesses

8. World Telecom Sector
According to the World Bank, an extra 10 mobile phones per 100
people in a typical developing country added 0.6 percentage points of
growth in GDP per capita, and this impact is about twice as large in
developing countries than in developed countries.

9. IT & ITES, Out sourcing
• The outsourcing industry in Asia has matured over the years, with
major players like India, China, Philippines, Malaysia, Thailand,
Vietnam, Bangladesh accounting for about 75 percent of the global
outsourcing revenues, growing at an annual rate of at least 30
percent.
• Several companies have gained 40 to 60 percent savings from
transferring non-core business processes to these Asian providers,
giving more dexterity and competitiveness in the global economy.
• Technical skills and language competencies, labor costs that are much
more competitive than Western countries, makes this region the ideal
destination for outsourcing non-core business processes for many
industries.
• Asia’s outsourcing industry is exploring new markets and trying to
open new doors.
• Strengths of Bangladesh ICT sector is the people who are gradually
contributing to several activities like graphics, software, telecom
services and e-transaction
.

10. Non-traditional Business as CSR
• Corporate Social Responsibility (CSR) is more than simply acts of
philanthropy or allocating a proportion of its earnings to worthy
causes; it is strategic in nature, and is about how a business
actually functions.
• CSR typically boils down to a set of policies within a company that
seek to ensure that its actions and activities are beneficial, not
only to itself and its shareholders, but also to other stakeholders
and the environment.
• CSR should never be seen as the ‘privatization’ of public policy.
• CSR perhaps through public-private partnership, could be more
emphasized throughout the region to promote human
development.
• Governmental support and promotion of responsible business
practices should not be equated to more red tape or an
indiscriminate call for increased regulation.

11. Why non-traditional investment flourish in AP
• In light of the current state of global economy, Asia
frontiers markets are poised to experience some of the
highest growth rate over the next decades
• Unquestionably, investors from emerging market,
particularly BRICS, EURO zone, USA, and Japan will come
forward in the countries like Bangladesh, Cambodia, Lao
PDR, Vietnam and other developing economies to achieve
higher return in the foreseeable future
• Asia will be considered as a long-tern investment
destination

12. Bangladesh – a case of Non
Traditional Opportunities

13. Non-traditional Export : Bangladesh case
Traditional Items:
Raw Jute, Jute Goods and Tea are considered as Traditional Export
Items.
Non-Traditional Items:
All Items other than Traditional Items are considered as Non-Traditional
Items, i.e. RMG, Frozen Foods, Leather & Leather Goods, Footwear,
Chemical Products, Pharmaceuticals, Home Textile, Handicrafts etc.
55%
45%
Traditional Items Non-Traditional Items
5%
95%
Traditional Items Non-Traditional Items
Contribution of Export in
1985-86
Contribution of
Export in 2010-11

14. In 2010-11, Total RMG Export of Bangladesh was
US$ 17914 million.
0
5000
10000
15000
20000
1995-961996-971997-981998-991999-002000-012001-022002-032003-042004-052005-062006-072007-082008-092009-102010-11
InMillionUS$
RMG Export
RMG Export Trend

15. Telecom Sector (Bangladesh)
• Telecoms has been one of the overwhelming success stories of over
the past decade with mobile subscriber growth exceeding all
expectations
• The exponential growth in Telecoms has had the same
transformative impact on Bangladesh’s economy as RMG and
Remittances
• As well as being the largest contributor to FDI and tax, the
catalytic effect of rapid mobile penetration has increased the
quality of life of millions of people
• The total number of Mobile Phone Active Subscribers has reached
85.45 million at the end of December 2011 (Which is about 54% of
total population)
The common services of Mobile Industry in Bangladesh are:
• Internet Service Provider
• Call Centers
• Public Switched Telephone Network
• Glossary Link International Gateway (IGW) Licenses, Glossary Link
Interconnection Exchange (ICX) Licenses, Glossary Link International Internet
Gateway (IIG)
• Optical Fiber Transmission Network
• Cyber Cafe
• Value Added Services
• Mobile Remittance Service

16. Public Private Partnership- a model for non-traditional
investment in Bangladesh
Dhaka Customs House Automation (DCHA) Project-
an Unconventional and Innovative Project for a Chamber
of Commerce which is implemented under PPP model.
This initiative is an example of how to reduce cost of doing
business by automation of customs services and bring
transparency with a target to enhance revenue earning of
the government.
To facilitate PPP project, government of Bangladesh has
formulated PPP guidelines and established PPP Office
under PMO.

17. Non-Traditional Business Opportunities in LDCs
• Promoting E-Business through Internet.
• The rising burden of security regulations on companies may be
resulting in businesses turning to countries with less developed
countries with more lax rules to avoid complexities.
• Doing businesses in regulated countries brings about an additional
cost and burden, so it will be more economical to transfer the
business to a less regulated country.
• Cost effective skilled manpower.
• “Let us recognize these 48 countries as vast reservoirs of untapped
potential,”. “I am not arguing for charity, but investment,” he said,
stressing that “the returns can be profound — not just for people
living in the LDCs, but for the global economy”
– Mr. Ban Ki-Moon, UN Secretary General
4th UN Conference on LDCs, May, 2011 at Istanbul, Turkey.

18. Business Opportunities in Landlocked Countries
•There are two landlocked countries (Mongolia and Laos)
in the Asia Pacific Region.
•Information technology does offer huge opportunities to
landlocked countries in the export of IT-based services
such as software development, data transcription, or
telemarketing.
•Landlocked Countries are less prone to natural disaster.
So, there is a little loss due to natural disaster.
•Most landlocked developing countries benefit from
recent initiatives to provide greater market access for
goods of least developed countries.

19. Challenges of LDCs
Political stability
Weak & Volatile GDP growth
Impact of Climate Change
Poverty
Poor Infrastructure
Low capacity
Inadequate social services
Poor Human Development
Mobilizing Domestic Resources
Good governance at national and international levels

20. Challenges of Landlocked Countries
• High Transport Costs
• Dependence on passage through a sovereign transit country
with high transit cost
• Infrastructure deficiencies
• Negative Influence on growth
• Lack of easy access to markets
• Maintenance problems
• Lengthy customs procedures
• Inefficiencies in the handling of goods at terminals and
interactions between the various agencies involved in the
transit operation
• Lack of security due to political differences
• Isolation from world markets

21. Challenges of Asia & the Pacific Region
• Reliable and sustainable funding sources;
• Controlling Inflation;
• Economic inequality/development gaps;
• Lack of a proper fiscal regulatory framework;
• Higher rate of Poverty;
• Absence of a regional capital market;
• Significant investments in infrastructure, technologies and
innovation to support enhanced business linkages;
• Inadequate growth of domestic demand through regional
cooperation and coordination among regional economies;
• Proper Human Development and Progress;
• The Financial crisis in the West remains a great concern for
developing AP.

22. Recommendations
• Asia’s current growth strategy is to export to the developed economies. To
stay competitive, the region must generate significant investments in
infrastructure, technologies and innovation to support enhanced business
linkages.
• Human development and progress should be given high priority to truly
make AP a real global economic leader.
• The countries of the Region need to diversify their sources of growth by
avoiding over-reliance on exports and enhancing growth of domestic
demand through regional cooperation and coordination among regional
economies.
• AP should develop useful financial tools to strengthen personal finance
mechanisms, including for education purposes, and social safety/welfare
nets, such as insurance.
• Regional Connectivity must be emphasized, linking supply chains is an
important modality in strengthening regional connectivity.
• Business connectivity requires the strengthening of both inter-business and
business-government linkages, either through frequent dialogue or through
public-private partnerships (PPP).

23. Recommendations (Cont…)
• The establishment of an AP FTA is an evolving idea that can ease the costs
of doing business. Cooperation between SAARC and ASEAN may ultimately
lead towards an Asia-Pacific FTA.
• The region should ensure the common political vision among the member
states.
• Chamber to Chamber relationship between the AP countries should be
invigorated.
• Non-Traditional Business (NTB) and Non-Traditional Investment (NTI) could
be a very important vehicle for AP development, a well-focused strategy
should be framed to encourage more and more NTI and NTBs in the AP
countries.
• AP countries should share their successful experiences to give a boost to
the NTI and NTB so that relatively less developed countries can come up
in this scenario.
• Extensive Research is required to address regulatory BARRIERS of NTI and
NTBs.
• Energy efficiency should be ensured in the region to address energy
security at national level and to effectively tackle climate change issues.

24. Thank You