Dhaka: Japan External Trade Organization (JETRO) Country Representative Kazuiki Kataoka said political and social stability following Bangladesh's February 2026 general election has encouraged Japanese companies to reassess the country's market potential and investment opportunities.
According to Bangladesh Sangbad Sangstha, Kataoka highlighted that political and social instability had been a major concern for Japanese investors under the interim government.
The establishment of a new government after the election has provided companies with greater scope to formulate medium- and long-term business plans and consider investment decisions, Kataoka added. JETRO's FY2025 Survey on Business Conditions of Japanese Companies Operating Overseas found that 94.4 percent of Japanese companies operating in Bangladesh identified "unstable political and social conditions" as an investment risk, a figure nearly unchanged from the previous year.
Kataoka noted that the increased stability eases the formulation of longer-term business strategies and investment choices. He observed a rise in visits to Bangladesh by senior executives from Japanese companies' headquarters in Tokyo and regional offices like Singapore, attributing this to growing stability and reassessment of Bangladesh's market potential.
Despite the positive outlook, Kataoka warned that political stability alone would not suffice to significantly boost investment. He emphasized the need for improvements in taxation, customs clearance, licensing, permits, and transparency of laws and regulations for a better business environment.
Kataoka also called for a shift in Bangladesh-Japan economic relations towards a stronger trade- and investment-driven partnership beyond traditional development cooperation. He advocated for mutual economic benefits through reciprocal investments, welcoming Bangladeshi companies to invest in Japan.
He pointed out the increasing interest of Japanese companies in Bangladesh's domestic consumer market, especially in Dhaka. Citing a survey by the Dhaka Chamber of Commerce and Industry, Kataoka noted that Dhaka accounts for approximately 46 percent of Bangladesh's GDP, with per capita income exceeding US$5,000, making it an attractive consumer market.
Kataoka mentioned the growing number of high-quality cafes, restaurants, and other businesses in Dhaka as indicators of rising demand for quality products and services. He acknowledged that high tariff rates make imported products expensive, prompting some Japanese companies to consider local production and procurement.
Identifying food and consumer goods as promising sectors, Kataoka suggested that Bangladesh's large population, rising consumer demand, and potential for local production could bolster Japanese investments in the future. He stressed the importance of continued efforts to improve the business environment to turn investor interest into actual investment commitments.