THE NEW RUSSIA

Bangladeshi firms should take advantage of huge Russian market Nasrine R. Karim

Russia-Bangladesh Chamber of Commerce and Industry (RBCCI) organized a discussion forum last week at the Radius Centre in Gulshan, with Foreign Advisor Dr. Iftekhar Chowdhury, Russian Ambassadoe G.P. Trotsenko and FBCCI director Mr. Rauf Chowdhury as main speakers. RBCCI Director Saladdin Imam and Export Promotion Bureau’s Director Mr. Omar Farooque also spoke on the occasion while RBCCI president Ms. NAsine KArim presided.
   There is no doubt that there is a lot of interest about Russia in Bangladesh, but because of language problem communication has become difficult. Besides, the lack of banking interaction throws further impediments to trading and commercial development. Yet, the top international banks are doing brisk business in Russia today with a strong stake in Russia’s multi-billion dollar commercial activities.
   Bangladesh has become a terra incognita for the Russians since the country’s inception in 1971 while Dhaka became busy working on the raising of its profile with the West. However, now it appears that Bangladesh has to make a concerted effort to re-shape its visibility in Moscow. Russia is one of the largest markets in the world and has a huge demand for a variety of goods which Bangladesh may easily find an export niche. Countries such as Vietnam, China (shares border), Turkey (shares border) and Korea are doing the cheaper end of the business for decades. All these countries have warehousing and banking facilities apart from the advantage of a huge resident population in place.
   However, high-end Bangladeshi goods are entering the Russian market through Europe (Germany, France & Holland) via Finland or directly. The encouraging information is that there is a great demand for Bangladesh’s RMG, leatherwear, tea, jute-goods and a number of other items within the Federation. Western and fusion designer wear is also of particular interest. The Russians are biased towards high end designer goods today which, is a far cry from Soviet Union days of the yesteryears.
   The Moscow and St. Petersburg Chambers of Commerce & Industry are very happy to assist Bangladesh to reach its target buyers. The Bangladesh Embassy in Moscow appears to be very efficient in projecting trading potentials. The Russian Ministry of Commerce is also well appointed towards Bangladesh. So what is holding us back? With focused marketing and quality promotion, Bangladesh stands to make substantial impact in the Russian market.
   RBCCI’s concerted attempts in focusing on the grand prospects in Russia has culminated with the Export Promotion Bureau holding several single country fairs, and inviting business houses attending the most important “CONSUMEXPO” in Moscow in January every year. RBCCI was also behind FBCCI visiting Moscow with a twenty-five member delegation and signing the very important trade protocol with the Federation Chamber of Commerce & Industry in 2006 bringing the two flagships for trade & investment together. The Moscow CCI also offered to sign an accord with the Dhaka CCI (the Draft was also submitted by RBCCI).
   However it is the recent high profile visit of Foreign Adviser Dr. Iftekhar Ahmed Chowdhury which has firmly paved the way to breathe a new life into the much-diminished diplomatic and economic relationship with Russia. He canvassed for several items for Bangladesh through his own personal friendship with the Russian Foreign Minister Mr. Sergei Lavarov. Russia today is broadening its relations with South Asia. The new Russia is seen as a growing super power in Asia. In the interest of creating a multi-polar world, Bangladesh should seek to enhance its relationship with the new Russia.
   Being home to a substantial Muslim population, Russia has an observer status with Organization of Islamic Conference (OIC). Russia actively encourages multi-theocracy within the Federation. Russia is seeking to join Asian Development Bank to play a greater role in the development of Asia. ADB is one of the main funding agencies in Bangladesh. Furthermore, the new alliance that is reverberating throughout the world between Russia, China and other CIS countries while the Shanghai Cooperation Organisation (SCO) was conceived on the premises of creating a balance of power in the world. The Bangladesh Foreign Advisor has already been given assurances that Russia will support Bangladesh’s entry as a member pf SCO once the present moratorium is lifted. Iran is actively canvassing to become a member while, Afghanistan, Pakistan and India have been accorded the observer status to this important Asian alliance.
   Russia’s relationship with Bangladesh is historical. Russia’s role in our liberation struggle is unforgettable and that they were our friends at the time of crisis! Had Russia not stood behind us, I wonder where our dreams would have been today. Russians set up our first power station which is still manned by them today and which tantamount to almost 30 per cent of our electricity generation. In 1971, they cleared the mines in the Chittagong Port, losing Russian lives in the process, so that we could commence commercial activities. Russia granted us special status in trade which we may still take advantage of today but presently we seem to be a little off course!
   Russia has, from near bankruptcy in 1998, accumulated a foreign exchange reserves of over US$ 455 billion now. Russia has also been experiencing a boom in capital investment since the beginning of 2007. It showed record growth in June, with construction industry leading the way. Being also one of the largest petroleum producers of the world, the new Russia holds the master key to global economy. Again, Bangladesh seems to be at cross roads with their relationship with the Russian Federation, which we can safely say, can be reinstalled with the right focus. Bangladesh, as a nation, only stands to benefit to have the Russians as friends.
   Bangladesh authorities are at present negotiating State grant from the Russians for several large power stations and also looking towards them for nuclear power generation technology. The Russians have multitude of proven technologies which Bangladesh might pursue actively to become equipped for self-preservation in the future.
   The discussion forum was also attended by the Turkish Ambassador and the Political Counsellor from China apart from members of the press, business firms and foreign ministry.
   The writer is President, Russia-Bangladesh Chamber of Commerce & Industry (RBCCI).

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Bank of the South starts from Dec. 5

Mark Weisbrot

“Developing nations must create their own mechanisms of finance instead of suffering under those of the IMF and the World Bank, which are institutions of rich nations … it is time to wake up.”
   That was Lula da Silva, the president of Brazil – not Washington’s nemesis, Hugo Chavez – speaking in the Republic of Congo a few weeks ago.
   Although the US foreign policy establishment remains in cozy denial about it, the recognition that Washington’s economic policies and institutions have failed miserably in Latin America is broadly shared among leaders in the region.
   Commentators here – Foreign Affairs, Foreign Policy, the editorial boards and op-ed contributors in major newspapers – have taken pains to distinguish ‘good’ leftist presidents (Lula of Brazil and Michele Bachelet of Chile) from the ‘bad’ ones – Chavez of Venezuela, Rafael Correa of Ecuador, Evo Morales of Bolivia and, depending on the pundit, sometimes Nestor Kirchner of Argentina.
   But the reality is that Chavez (most flamboyantly) and his Andean colleagues are just saying out loud what everyone else believes. So, official Washington, and most of the media, has been somewhat surprised by the rapid consolidation of a new ‘Bank of the South’ proposed by Chavez just last year as an alternative to the Washington-dominated International Monetary Fund (IMF), World Bank and Inter-American Development Bank.
   The media has been reluctant to take the new bank seriously, and some continue to call the institution, pejoratively, “Chavez’s bank.” But it has been joined by Brazil, Argentina, Bolivia, Ecuador, Uruguay and Paraguay. And just a few weeks ago, Colombia, one of the Bush administration’s few remaining allies in the region and the third-largest recipient of US aid (after Israel and Egypt), announced that it wanted in. Et tu, Uribe?
   The bank, which will be officially launched on 5 December, will make development loans to its member countries, with a focus on regional economic integration. This is important because these countries want to increase their trade, energy and commercial relationships for both economic and political reasons, just as the European Union has done over the last 50 years.
   The Inter-American Development Bank, which focuses entirely on Latin America, devotes only about 2 per cent of its lending to regional integration.
   
   No policy conditions
   Unlike the Washington-based international financial institutions, the new bank will not impose economic policy conditions on its borrowers. Such conditions are widely believed to have been a major cause of Latin America’s unprecedented economic failure over the last 26 years, the worst long-term growth performance in more than a century.
   The bank is expected to start with capital of about US$7 billion, with all member countries contributing. It will be governed primarily on a one-country, one-vote basis.
   How ironic is it that such an institution would be called “Chavez’s bank,” while nobody calls the IMF or the World Bank “Bush’s bank?”
   The IMF and World Bank have 185 member countries but the United States calls the shots; it has a formal veto in the IMF, but its power is much greater than that, with Europe and Japan having almost never voted against Washington in the institution’s 63-year history.
   The rest of the world, i. e., the majority and the countries that bear the brunt of the institutions’ policies, has little to no say in decision-making.
   Politically, the new bank is another Declaration of Independence for South America, which as a result of epoch-making changes in the last few years is now more independent of the United States than Europe is.
   The most important change that has brought this about – other than the populist ballot-box revolt that elected left-of-centre governments in Argentina, Bolivia, Brazil, Ecuador, Uruguay and Venezuela – has been the collapse of the IMF-led “creditor’s cartel” in the region.
   This was the main avenue of US influence, and there’s not much left of it. Of course, the US government still has some clout in the region, but without the ability to cut off credit to disobedient governments, its power is vastly reduced.
   The need for alternative regional economic institutions, for both development lending and finance, is becoming increasingly accepted by most of the world. Ten years ago, in the wake of the Asian financial crisis, there was a whole series of proposals, even books by prominent economists, on how to reform ‘the international financial architecture.’
   The current crisis triggered by the collapse of sub-prime-mortgage-backed securities may provoke another such discussion. But the fact is, a full decade after the Asian crisis, the rich-country governments have made no significant movement toward reform. New leaders of the IMF and the World Bank were appointed in the last few months, and by tradition, these have to be a European and an American.
   That tradition was honoured, despite calls from a majority of the member countries and scores of NGOs and think tanks to open up the search process. For the World Bank, the Bush administration even managed to add insult to injury by appointing Robert Zoellick, a neo-conservative in the mold of his intensely disliked predecessor, Paul Wolfowitz, to run the beleaguered institution.
   Without even the smallest symbolic changes, it is hard to imagine more substantive changes, e.g., in the voting structure, taking place in the foreseeable future.
   With reform at the top blocked, positive changes will have to come at the regional, and of course, most importantly, at the national level. Latin Americans are doing their part, and the world will surely thank them for it.
   Not everyone is happy to see the old order challenged. An insider at the Inter-American Development Bank told the Financial Times: “With the money of Venezuela and political will of Argentina and Brazil, this is a bank that could have lots of money and a different political approach. No one will say this publicly, but we don’t like it.”
   Apparently, these institutions that preach the virtues of international competition are not so enthusiastic when it breaks into their own monopolistic market.
   — Third World Network Features

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Holiday Desk

Summit Purbanchol Power Company Limited and Summit Uttaranchol Power Company Limited, the subsidiaries of Summit Power Limited (www.summipower.org), have signed an agreement with Energypac Engineering Ltd. relating to design, engineering procurement, supply, manufacturing, erection, installation, testing and commissioing of transformers and other equipment for three 33 MW capacity power plants.
   Under the agreement, Energypac will supply 20/25 MVA, 12.5/15 MVA, 11/33 KV power transformers and 750 KVA, 11/0.415 KV station transformers with necessary equipment, materials and related works for the three 33 MW capacity each power plants being set up at Rupgonj in Narayanganj; Jangalia in Comilla; Maona in Gazipur and for 11 MW power plant at Ullahpara in Sirajganj. Total numbers of transformers to be supplied these contracts are 14.
   A.N.M. Tariqur Rashid and Saiful Alam have signed the contracts on behalf of the two Summit subsidiaries while Engr. Rabiul Alam, Director and CEO of Energypac Engineering Ltd. has signed both the contracts on behalf of this compnay.
   Tauhidul Islam, Managing Director and Md. Latif Khan and Ms. Ayesha Aziz Khan and sevior officials were present.
   Summit Power Limited has successfully established three power plants for sale of electricity to Rural Electrification Board (REB) under build, own and operate basis at Savar, Narsingdi and Comilla and generation of electricity commenced in the year 2001 from three power plants each with a capacity of 11 MW. The company has already expanded its total generation capacity to 105 MW. With the establishment of the new projects generation capacity will be raised to 215 MW.

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