Appetite for business in Bangladesh
Regional manager for Canadian state-run credit agency is set to build bridges between Canadian companies and their foreign buyers
Md Fazlur Rahman
Export Development Canada (EDC), a Canadian state-run credit agency, plans to exploit business opportunities that exist in Bangladesh, a top official said.
“Everyone talks about Russia, Brazil, India and China. But it is important to realise that there are a branch of countries that are growing and should not be overlooked. Bangladesh is one of them,” said Mark Bolger, regional manager of EDC for Asia.
“But people tend to forget there is great opportunity elsewhere in the world. Canada does have a role to play in the economic success of Bangladesh. We have an appetite for business in Bangladesh under all our programmes,” he said.
EDC is Canada’s export credit agency, offering innovative financing, insurance and risk management solutions to help Canadian exporters and investors expand their international business.
In 2010, EDC supported over $82 billion worth of Canadian exports to over 185 countries.
Every year, EDC’s knowledge and partnerships are used by more than 8,300 Canadian companies and their global customers in up to 200 markets worldwide. Approximately 80 percent of EDC’s customers are small and medium-sized businesses.
Since EDC was founded in 1944, it has facilitated more than $780 billion in exports and foreign investment by Canadian companies.
Bolger said EDC is Canada’s export credit agency and works like a financial institution. “But we are mandated to support Canadian exports and investment. In doing so, we are helping support foreign buyers who want to buy Canadian goods and technology. We help them succeed in their business plans.”
He said EDC works to build bridges between Canadian companies and their foreign buyers. “International trade has risks. We are there to help mitigate those risks. At the same time, we help make important connections what Canada can supply and what foreign buyers need,” Bolger told The Daily Star in an interview in Dhaka on Thursday.
He said there is low awareness on what types of goods and technology can come from Canada. So, EDC spends a lot of time trying to understand what Canada can provide and help Canadians know those supply opportunities to foreign buyers.
Bolger said the interest rate EDC charges depends on what type of risk it is asked to take. “In case of a loan we are making to a foreign company to buy goods from Canada, we will charge an interest rate depending on how risky we feel the company is.”
During his visit, the Canadian spoke to some leading Bangladeshi companies to try to understand what their needs are and see whether there is a role that EDC can play to help them succeed.
He said his institution has not set any target for Bangladesh. “Our targets are based more on clients’ satisfaction. We can make a sale. Even if EDC is not involved in providing financing, we can introduce a Canadian company to a Bangladeshi company and they can do business. We may be there financially or we may not, but the key for us is to generate those business potential.”
Bolger, who has been working with EDC for 22 years now, said Bangladeshi buyers who purchase capital goods or industrial machinery from Canada and need financing can contact EDC. “If they do not need financing and all they want is a better understanding of what Canada may be able to supply them, EDC can also play a role. There are lots of service providers to help consolidate trade relations between our two countries.”
EDC has given a line of credit to India for power projects. “EDC can do the same in Bangladesh if there is any potential in Bangladesh. We provided financing to some of India’s largest corporate names such as Tata, Reliance, Bharti, Mahendra and Mahendra. Here, I would also like to see some of the big Bangladeshi companies who may require financing.”
He said the import of capital goods and equipment from Canada is a priority sector for them.
He said longer-term financing is really for industrial machinery. “I am looking to those Bangladeshi companies that may have requirements for injection moulding equipment for plastics, packaging, process machinery and factories.”
“Even there is opportunity for telecom equipment here. Canada also has strength in environmental products and services. I have yet to find a country that does not require that or has no interest in green technology. That is another area I will be looking into.”
Although EDC is meant to support the export of Canadian goods and services, it also can help foreign companies find markets. “There has to be a tie back to an export from Canada. That does not mean we cannot also look at providing a little bit of support for goods coming from other countries because in today’s global economy, everybody has a supply chain integrated with another country. We will consider a little bit of support from goods coming from other countries.”
Bolger, who has a master’s degree in international finance and business from the University of Ottawa, said EDC looks for credit-worthy companies. “We also have strong corporate social responsibility requirements. We look for those companies that have good environmental practices and anti-bribery and anti-corruption practices. Those are the key elements. In general, we are looking for credit-worthy good corporate citizens.”
He said EDC also can be involved in financing government projects. “But the same rules apply. We expect foreign governments to be credit-worthy and adhere to good environmental, human rights, anti-bribery and anti-corruption practices.”
It makes no difference to them if it is a private sector or public sector entity, he added.
Last year, EDC had business in insurance and financing worth $85 billion in 190 countries around the world. Its business in emerging markets is growing substantially. Out of the $85 billion, business worth roughly $25 billion was done in the emerging markets.
“Although the United States is still a very strong trading partner of Canada, as a result of the global economic slowdown, more and more Canadians are now waking up to the fact that there are other opportunities out there. They are looking at other markets now besides the United States.”
“We are encouraged by that. We feel that for Canada to succeed economically, we need to diversify. There is nothing wrong with ensuring that you have buyers spread out all over the world. So, Canadians are looking elsewhere now for new opportunities and trade partners.”
He said EDC can help raise awareness on the opportunities that exist on both sides. “Whatever goods and services Bangladesh needs, we may be able to make them understand what may come from Canada. For Canadians, it is equally important. We can help them understand the huge growth potential that exists here in Bangladesh and what the Bangladeshis need. Hopefully, it will encourage Canadians to look abroad and to Bangladesh and see the trade potential there.”
EDC has business in every country in South Asia.
He said Asia plays a critical part in EDC’s business and the region contributed over 40 percent to the agency’s emerging market business last year. “Canadians and EDC see very strong values in Asia. It is really one of the world’s economic engines. You cannot just look at China and India. Collectively, every market in Asia has something to offer to Canada. Asia pitches very prominently in our corporate strategy and hopefully in the Canadian business strategy as well.”