Manufacturing Sector in Developing Countries

Country Perspective
Bangladesh

Manufacturing Industry and Globalization

Manufacturing industries production contributes in global economy through increasing GDP Creates employment not only for country people but also for others, helps to prevent global unemployment Offers better, quality products worldwide. Increase global production Large production helps to reduce cost worldwide
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Criteria for Developing Country

A developing country is a nation with a low level of material well-being World bank classifies developing countries asa. Low income countries had GNI per capita of US$1005 or less. b. Lower middle income countries had GNI per capita between US$1006 and US$ 3,975

List of developing countries

Developing countries list Asia
Afghanistan Bangladesh Bhutan

Cambodia
East Timor Myanmar

Nepal
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Developing countries in Map

Manufacturing Industry
Manufacturing industry refers to those industries which involve in the manufacturing and processing of items and indulge in either creation of new commodities or in value addition. The manufacturing industry accounts for a significant share of the industrial sector in developed countries. The final products can either serves as a finished good for sale to customers or as intermediate goods used in the production process.
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List Of Leading Manufacturing Industries

Scenario of Manufacturing Industry in Developing Countries

Scaled back trade barriers over the past twenty years, the industrial sector remains relatively protected in the typical country. Governments also promote manufacturing with special tax concessions and relatively low tariff rates for importers of manufacturing machinery and equipment. Developing countries have been able to use the policy buffers (in the form of ample fiscal space) The strong GDP growth in many developing countries and economies in transition, which has been contributing to more than half of the expansion of the world economy since the third quarter of 2009. Developing countries continue to drive the global recovery, but their output growth in manufacturing sector is also expected to moderate to 6.0 per cent on average during 2011-2012, down from 7.1 per cent in 2010 8

Chart Of Global Production

Success Criteria for Manufacturing Industry in Developing Countries

Resources Improvement Quality and quantity improvement Manufacturing Flexibility Trade protectionism

Manufacturing Configuration

Inventory management

Cost Reduction

Improved Economy

Manufacturing coordination

Managerial Regulation

Imitation

Technological Advancement

Strategies

Managerial Performance

Government Policies

Suppliers Relations

Manufacturing Control

Manufacturing Compatibility

Labor Employment

Transportations Network

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Problems
Imports from abroad Small Market size

Dumping

Limited Access to manufactured inputs

Poor Legal Systems and Crime Prevention

Inadequate road and rail network

Economic and Political Volatility

Insufficient Human capital

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Economy of Bangladesh
Rank Currency 43 Bangladesh TAKA(BDT)

Fiscal Year
Trade organizations GDP Growth

1 July - 30 June
WTO, WCO, IOR-ARC, SAFTA, D8 6.7% (2010 est.)

GDP Per Capita

GDP By Sector Inflation(CPI)

$1,700 (2010 est. PPP)

Agriculture: (20.16%), industry: (29.95%), services: (49.90%) (2009 est.) 8.80% (2010-11)
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Ease of Doing business rank Exports Export goods

107th $22.93 billion (2010-2011)

Main export partners

garments, textiles, jute and jute goods, ships, leather, produce, frozen fish and seafood, pharmaceuticals, ceramics, cement US 31.8%, EU 12.9%, Germany 10.9%, UK 7.9%, France 5.2%, Netherlands 5.2%, Kuwait 4.9%, Japan 4.5% Italy 4.42% (2010) $32 billion (2010-2011)

Imports Import goods Main import partners Ease of Doing business rank

machinery and equipment, chemicals, iron and steel, raw cotton, food, crude oil and petroleum products, China 11.4%, Singapore 9.1%, India 8.5%, Hong Kong 7.1%, Japan 6.5%, U.S 5.1% (2008 est.) 107th
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Contribution of industries to GDP during 2009-10 (m US$)

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GDP Growth

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Manufacturing Industries of Bangladesh

KDS GROUP Pride Group Viyellatex group

Textile

Shipbuilding

Khulna shipyard Ananda shipyard Meghnagroup Beximco Incepta Square

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Pharmaceutical

Five Successful Industry of Bangladesh

Textile Pharmaceutical

Shipbuilding

Leather and footwear

Electronics

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Reasons For Success

Huge percentage of using computerized machinery & modern technology. Financial support from banks for having outstanding loan, Overdraft facility. Suitable business environment corresponds to the institutional, policy, and regulatory environment in which firms operate. Significant R&D activities complete regularly Excellent Power supply facility Negative effect of crime Less bureaucracy and red tape in these industries Well managed companies
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Five Failing Industries of Bangladesh

Sugar

Paper

Fertilizer

Candle

Salt

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Reasons Of Failure
Less Government support for local producers Government is careless about the Import policy & importing from neighboring countries because of Election commitment. Not much R&D activities complete regularly. Poor Power supply facility. Active corruption. More bureaucracy and red tape in these industries. A lesser amount of banking facility. Fewer infrastructure developments than the competitors.
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Sugar Industry of Bangladesh

Bangladesh had a start of Sugar industry before the Liberation . the early startup was impressive when Govt. introduced Shyampur Sugar Mills in 1967 in Rangpur District.This Sugar mill is Still running but the productivity had become lesser than ever. In Bangladesh , currently many private owned Sugar mills and some Govt. owned Sugar mills are running but dishartedly , all of them are not in a good condition. There is a high Sugar productivity in the Northern regions of Bangladesh which almost comprises about 70% of overall sugar production of Bangladesh. The Base Sugar Production States are : Among Northern Districts : Rajshahi Natore Dinajpur Rangpur Kurigram Bogra 21 Pabna

Major Challenges
The seasonal nature of the industry, Old and inefficient methods of production, Transport delay in reaching cane to factories High communication and transportation barriers Severe lack of high-tech technology Strong need of trained manpower The need to maximize the use of Bag gasses Cyclical fluctuations High support prices Lack of adequate working capital Partial decontrol and the uncertain export outlook Rising raw material costs Limited export capacity Sugarcane area is dwindling Competition from more profitable crops like rice and maize makes it 22 difficult to convince farmers to accept the low price offered by mills

Possible Solutions
Sugar Refine nary Improvement Technological improvement Trained Workers Govt. regulations to promote Local Sugar Govt. help in building Sugar industry Capital flow for Sugar milling Improved Machineries Quality Improvement Export ease
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