Spanish nationals are increasingly expressing keen interest in exploring business opportunities in Bangladesh, said Francisco de Asís Benítez Salas, Spain’s Ambassador to Bangladesh.
“Although the Spanish community in Bangladesh is not very large, we are indeed experiencing recently a growing interest of Spanish nationals in moving to Bangladesh to explore business opportunities,” the ambassador told The Business Standard in an email interview.
But to attract Spanish investments, Bangladesh has to provide a more attractive framework for foreign companies in terms of transparency, customs barriers and tariffs.
“The key obstacles that need to be addressed to make the country more attractive to Spanish investors are mainly related to increasing the transparency level as well as improving the investors’ business climate in the field of legal certainty,” said Francisco.
Foreign direct investment (FDI) in Bangladesh reached nearly $3.5 billion in FY22, but Spain did not rank among the top 20 contributors. The ambassador believes that Bangladesh has significant potential to attract more FDI, which presently accounts for less than 1% of its GDP.
He, however, said the Bangladesh Investment Development Authority (BIDA) is working hard to help boost investment and increase the ease-of-doing-business. If Bangladesh could climb up the ladder in international rankings like the Ease of Doing Business Index, it would send a clear message to potential foreign investors. In this sense, he said it is important to show the world that Bangladesh is committed to attract more investment from abroad.
He also explains why Bangladesh needs foreign investments.
Bangladesh is heavily dependent on readymade garments and the country needs to diversify its export basket, especially to face the challenges after the LDC graduation. “FDI could play a big role in fostering diversification, knowledge spillovers and innovation,” he noted.
Besides, Bangladesh could find interesting opportunities in cutting-edge sectors, including environmental technologies and green energy.
He also believes Bangladesh has the ability and human capital to diversify its export portfolio. For instance, there are opportunities for Bangladesh to excel and become a global player in agro-food products, the fishing industry, ICT products and the pharmaceutical industry, he said.
“It is key to develop a more coordinated approach between industrial, trade and FDI policies that can act together as a catalyst for development,” added the top Spanish envoy in Dhaka.
Francisco also spoke about the Bangladesh-Spain bilateral trade and investment relations, the role of an increasing Bangladeshi diaspora in Spain, LDC graduation and passing a resolution in the European parliament calling for free and fair elections, among others.
Spain was the second-largest export market for Bangladesh’s RMG products after Germany in Europe. Bangladesh’s RMG exports to Spain were $3.57 billion in FY23 with a growth rate of 18.53%.
Bearing in mind that the fiscal year in Spain runs from 1 January to 31 December, as in the calendar year, Spanish exports to Bangladesh amounted to $216 million in FY22, with a growth rate of 3.5% from the previous period, he said.
“The bilateral trade between Bangladesh and Spain has been growing significantly over the years, yet there is a very marked imbalance mainly due to tariff and non-tariff barriers, as you can tell by the export numbers.”
Francisco further said, “While we should continue to encourage Bangladesh’s exports to Spain, it is also key to promote Spanish exports to Bangladesh. Our country is very interested in strengthening our relationship as trading partners, and the Economic and Commercial Office of the Embassy of Spain in Bangladesh offers its support to companies willing to export and invest.
A second key aspect to further enhance bilateral trade is diversification, he said. Owing to Bangladesh’s heavy reliance on the textile industry, both exports (RMG) and imports (inputs for RMG sector) are concentrated in the same sector. The textile industry has played a leading role in the economic development of the country, and others could follow suit. There is still a lot of room for diversification in our economic and trade partnership.
Spain is a very competitive country and our companies and products, very much appreciated globally for their quality, are present in all world markets. For example, he said, Spanish companies are world leaders in many sectors: highly productive agriculture, food processing, fisheries and fishing industry, healthcare, infrastructures, and railways, to name a few. “In all these fields, our relations could be further extended,” he added.
On the challenges and opportunities after Bangladesh’s LDC graduation in 2026, Francisco said it can act as an important incentive to modernise the country’s policy-making so that, under a potential transition to a GSP+ scheme, the EU would still grant preferential access.
The envoy said potential trade agreement falls under the European Union common commercial policy and is something which must be agreed upon by all EU member states. Nevertheless, he said Spain stands firmly with Bangladesh and will do its best to assure the best possible trade deal for Bangladesh is achieved. “We will also work in this direction at the European Union level and with other Member States,” he noted.
On the Bangladeshi diaspora in Spain, he said there are over 60,000 Bangladeshis living nowadays in Spain, which means that Spain has the second largest community of Bangladeshis living in the European Union after Italy.
“Moreover, the social integration of Bangladeshis in Spain has been remarkable in the last decades and the number of second-generation Bangladeshis is already increasing by the day,” said the Spanish envoy.
He said Bangladeshis live all over Spain, mainly in the major cities and in the Mediterranean coast but there is a recent trend of them settling in the islands, both the Canary Islands and the Balearic Islands.
The envoy went on to say Bangladeshi people work in services and run small businesses contributing through their hard work to the cultural richness and GDP growth of Spain.
Asked whether the EU parliament’s resolution against Bangladesh could impact trade and investments between the EU and Bangladesh, the envoy said it is important to take into account that the resolution of the European Union Parliament last September is independent from that of the European Union member states. The EU Parliament takes its own initiatives and reflects its own views, he said.
“Spain will support all efforts carried out and measures taken by Bangladeshi authorities to strengthen human rights standards. Indeed, one key priority of the Spanish presidency of the European Council is the promotion and protection of human rights and fundamental freedoms,” said Francisco.
The ambassador also said his country intends to grow bilateral relations with Bangladesh in the travel and tourism sector.
“Just last year, we had in Dhaka a joint event in collaboration with the Tourism Office of Spain in Mumbai where four of the leading Spanish companies in the travel sector participated. The event was attended by approximately 48 travel agents from Bangladesh, and the networking sessions indeed turned out to be very productive,” he said.
On the immense popularity of Spanish football in Bangladesh, Francisco said he is very proud to see, almost on a daily basis, how much the Bangladeshi people, especially the youth, love Spanish sports in general and Spanish football in particular. “I personally was very excited to see so many Spanish flags all over Bangladesh during the last World Cup.”
“Bangladesh has the largest number of La Liga followers in the world and we all should take advantage of this passion to bring our bilateral relations to new heights and into new areas such as culture, education, exchange programs among the youth, and trading opportunities,” he said.
The publication of the first edition of the Spanish-Bangla football dictionary last May in collaboration with La Liga is a good testament to their shared and promising future, he added.
Spain is holding the Presidency of the European Council for the fourth time since it joined the European Union. The envoy said as the second-biggest country and the fourth largest economy in the EU, Spain is this time focusing on four priorities: the reindustrialisation of the EU, the achievement of green transition and environmental adaptation, social and economic justice and the enlargement of the EU.
These areas, especially green transition and social and economic justice, match very well with Bangladeshi balanced foreign policy as well as with the enormous — and successful — efforts carried out to tackle climate change an d reduce poverty, he concluded.