South Korean company to manufacture cars in Bangladesh
- Source: Xinhua
- [16:38 October 15 2009]
- Comments
A South Korean automaker will invest around two billion US dollars in Bangladesh to manufacture cars aiming to grab the South Asian country's booming market and avail the opportunities for export abroad, officials said Thursday.
Secretary of Bangladesh's Industries Ministry Dewan Zakir Hussain told Xinhua Thursday, the South Korean company -- Tagaz Korea -- has already procured 350 acres of land near the country 's capital city Dhaka for establishing its plant.
"We welcome the company's mega investment plan in Bangladesh," he said, adding "Our doors are open for any sorts foreign investment in the country."
The company has planned to complete establishing its plant in Bangladesh by the next 24 months, Hussain said adding the Korean and Russian joint venture company wants to manufacture cars in Bangladesh because of its low labor cost and strategic location for export market.
Automobile industry is a semi-labor intensive industry so the labor cost is a factor for more competitiveness in global market, said Abdul Mannan Nasir, managing director of Cimillae Development Co, a concern of the Tagaz in Bangladesh.
He said, "A sedan costs 10,000 US dollars in South Korea but we can reduce the cost here by around 3,000 US dollars due to low labor cost and other facilities."
Apart from cheap labor, Nasir said Bangladesh as a developing nation is enjoying some special benefits in exporting its goods to European market which also impressed Tagaz to choose the country for its investment destination and become first automobile company in the country.
According to local media report, Bangladesh's car market has been growing steadily over the past few years mainly because of the ease credit facility. The country imports around 30,000 re-conditioned cars a year.
