For the past 100 years or more, Muslims have been trying hard to chase the “Western” trends. The results are many copycat haram ventures, franchises, and the like. Yes, many Muslims got rich, but even if it’s not haram, it’s leftovers.
A better strategy is to turn your head to Muslims own back yards and think creatively using the resources that Allah has blessed you with. Because, now it’s the time to revive the Sunnah of Halal trade, when the Haram financial systems are collapsing left and right.
Below are two articles about new opportunities, one article about Bangladesh and the other one is about Africa.
Cheap labour lifts Bangladesh through global downturn
DHAKA (AFP) – An army of cheap labour has made Bangladesh a hotspot for growth as the rest of Asia struggles through the global financial crisis and observers say the country must now exploit its advantages.
With China finding it increasingly difficult to mass-produce low-cost items at discount rates, buyers have turned their attention to Bangladesh where textiles and footwear can be made cheaply.
“The country is fast replacing China as the desired low-cost manufacturing hub in Asia for items such as textiles and footwear,” Ifty Islam, managing partner of Asian Tiger Capital, an investment bank, told AFP.
“Thanks to this abundance of cheap labour and an insulated financial system, Bangladesh was one of the best performing economies in Asia in 2008,” Islam, a former managing director at Citigroup and Deutsche Bank, said.
“It will remain so this year and in 2012 we may hit eight percent growth. If the new government can sort out power and infrastructure problems, Bangladesh will be unstoppable.”
Battered by the global financial slowdown, stock markets across the continent fell more than 50 percent on average in 2008, while exports have slumped to the negative in many of the so-called Asian tiger economies.
“Dhaka shares were down by merely seven percent. In the five months to November Bangladesh exports grew 27 percent year-on-year, possibly the best rate in the world,” Islam said.
Thanks to soaring exports and also remittances sent by the country’s overseas workers, Bangladesh’s central bank has projected a 6.5 percent growth this year if shipments continue to fare well.
“Unlike economies facing heavy capital outflows and credit crunches in the current turmoil, credit and liquidity conditions remain easy here with no need for any blanket economy-wide monetary or fiscal stimulus,” the bank said.
Analysts and foreign investors said tens of millions of labourers who work in poor conditions for less than 50 dollars a month are boosting Dhaka’s growth at a time when buyers such as Wal-Mart are looking for cheaper sources.
“All eyes are on Bangladesh because it is the only country which can produce quality textile items at least 20-30 percent cheaper than China,” said Steffen Mohler, director of Germany’s Multiline Limited, a top trading firm.
Multiline has this month started building one of the world’s largest textile factories 50 kilometres (30 miles) north of Dhaka with an investment of 200 million dollars.
It will be largest foreign investment in the country’s fast growing textile sector, which accounts 75 percent of its total exports, and will create jobs for 15,000 people when it goes into production early next year.
“We are here because Bangladesh will dominate (the) textile business for years to come. I know of no one — department stores, top retailers and trading firms — who are now not in Bangladesh. They are diverting their orders from China,” Mohler said.
“We see Bangladesh textile exports doubling to 22 billion dollars by 2011.”
Taiwanese entrepreneurs who played a key role in transforming China into the world’s top performing economy are rushing to Bangladesh to look for land to build footwear and textile factories, Taipei’s representative Frank Chen said.
“Every week we have teams from Taiwan. Many of them have shut down factories in China’s southern Dongguan city because they cannot make any money there. Bangladesh is the place which is still profitable,” he said.
Taiwanese investors have set up more than two dozen footwear, textile and furniture factories in Bangladesh with the firm Pao Chen looking to build the world’s largest footwear factory which would employ 40,000 people, he said.
Such has been the rush of investors that Bangladesh’s export processing zone (EPZ) authority says it is running short of plots to allocate to the incoming foreign investors.
“We have rented out almost all the plots,” said the authority’s spokesman. “Only a handful in the country’s 10 EPZs remain, but we are searching for more.”
Now’s the Time to Invest in Africa
Over the years many misguided pronouncements have touted the improved economic prospects of Africa, home to a large proportion of the world’s billion poorest people. The late 1990s even saw a slight economic resurgence, dubbed an “African renaissance,” but it fizzled, and a gloomy view of the continent as too unstable for investment other than in mining and oil seemed to settle over corporate boardrooms.
But reliable data show that a number of sub-Saharan nations have emerged from conflict in stable condition and that new macroeconomic forces are poised to have a profound effect – despite the global economic downturn. For example, the International Monetary Fund’s World Economic Outlook, re- leased in October 2008, projected economic growth of 6.3% for sub-Saharan Africa in 2009, with Uganda, Tanzania, and Nigeria exceeding 8% growth. Our research on African companies indicates that the continent offers competitive manufacturing sites, IT outsourcing, and construction services. There is real opportunity on the ground in Africa.
Multinationals and investors should bear these developments in mind:
Stability. The periods of catastrophic government action that slowed growth in past decades have become much less frequent. The failures in Ghana, Uganda, Tanzania, and Nigeria in the 1970s and 1980s were profound learning experiences for those countries, which have joined the list of today’s success stories. Nigeria, for instance, has paid off its external debts, enacted prudent fiscal rules, and cleaned up its banking system.
Policy. The more favorable policies of developed nations have laid the groundwork for growth: Many of Ghana’s exports, for example, qualify for duty-free access to EU and U.S. markets. Policies within African countries have boosted local economies: Rwanda, for instance, has made information and communications technologies the cornerstone of a new growth strategy, setting up the ICT Park in Kigali, its capital.
Profits. Our study of 2002–2007 financial data from all the Africa-based publicly traded companies for which data were available (a total of 954, mostly in manufacturing and services) shows that many of these firms are highly profitable. (For foreign-owned companies we looked only at the performance of the African entities.) In part because of low labor costs and gains in operational efficiency, the average annual return on capital of the companies studied was 65% to 70% higher than that of comparable firms in China, India, Indonesia, and Vietnam. The median profit margin was 11% –better than the comparable figures for Asia and South America. Our analysis of World Bank data on 1,869 African companies confirms these findings.
Opportunity. Construction companies, call centers, and IT services are among the region’s most successful businesses. The engineering services company Gasabo 3D Design, located in Kigali’s ICT Park, uses computer technology to transform drawings into three-dimensional models for customers at a highly competitive hourly rate of US$10.
Years have passed since investors updated their view of Africa’s promise. The time is ripe for multinationals to rethink sub-Saharan opportunities and simultaneously to help the region achieve its promise by contributing much- needed capital, business skills, and global connections.
Paul Collier, author of The Bottom Billion (Oxford, 2007), is a professor of economics and the director of the Centre for the Study of African Economies at the University of Oxford in England. Jean-Louis Warnholz is a researcher at the Centre for the Study of African Economies and a consultant on business development in emerging markets.