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Tourism in Bangladesh: Challenges and opportunities

Previously I have discussed the importance of defining “Brand Bangladesh” and perhaps one of the most important aspects of nation branding is as a means of promoting a country’s tourism industry.

According to the World Tourism Authority since 1950, tourist activity has grown each year at an average rate of about 7 per cent, increasing from 25 million to 808 million in 2005. Some estimates suggest that worldwide receipts for international tourism presently amount to US$ 630 billion per year.

In recent years, Asia has done particularly well, with Thailand the undisputed leader with annual tourism revenues per head of US$ 157 (2004). By contrast, Bangladesh has one of the worst performing tourism sectors, with less than US$ 0.5 per capita which compares with Sri Lanka at $ 26 and India at $ 6.

Is Bangladesh’s disappointing growth in tourism due to poor marketing alone? Only up to a certain point. Although, weak Nation Branding is one factor, there are several others including a lack of attractive hotel resorts, poor infrastructure and disappointing customer service.

The National Tourism Policy was set out in 1992 with limited positive impact on developing the sector. This ineffectiveness saw a revision in the National Industrial Policy of 2005 that expanded the tax incentives for foreign investors along with generous repatriation allowances to encourage more FDI. But the impact of this initiative has so far been modest.

An excellent paper by Mizan Khan and Mahfuzul Haque (see BIMSTEC-Japan cooperation in Tourism and Environment: Bangladesh Perspective, May 2007) provides a valuable analysis on Bangladesh’s tourism sector. They note the strengths, weaknesses, opportunities and threats faced by the sector.

On the strengths side, the country possesses some unique archaeological sites, cultural heritage and eco-tourism products like the world’s largest mangrove forest, the Sundarbans, the world’s longest unbroken sea beach in Cox’s Bazar (120 km), the oldest archaeological site in the Southern Himalayas-Paharpur and world’s largest terracotta temple – Kantaji Temple in Dinajpur. The weaknesses are the limited budget for tourism promotion overseas; lack of policy direction and volatile staffing at Parjatan and a poor country image.

As for opportunities, they point to how easy it would be to implement eco-tourism, riverine tourism, and spiritual tourism. The threats are the unstable political environment and natural disasters that re-enforce the poor country image as well as potential objections from the more conservative elements in society to expansion of foreign tourism.

But in my mind, before we think about a marketing strategy, we need to have the right product in place. The strongest competitive advantage that the Bangladesh tourism industry has is cheap labour. The challenge is to translate that into a level of customer service that will differentiate a holiday and make it competitive in terms of value per dollar spent with alternatives in Asia.

In my previous life as a global strategist, I have been fortunate to travel to 57 countries and have stayed at hundreds of different 5 star hotels. My favourite is the Amanusa resort in Bali and when I visited it I remember that within 10 minutes of my family checking in, I walked past the gardener who said “Hello Mr. and Mrs. Islam”. How did he know my name so quickly? It transpires that every member of staff is expected to memorise every guests face and name before they check in. Aman resorts are in the ultra-luxury end of the market with only 30 villas per resort and they have a staff to guest ratio of 10:1.

Certainly Bangladesh with much cheaper labour can also set up high-end hotels with butlers assigned to each room and nannies for every child. But it’s all about the training which is why when Aman opens a new resort, 50 percent of the staff are imported from an operating group hotel for one year to ensure the highest level of training. Bangladesh needs to establish a tourism manpower-training institute with foreign hotelier participation to strive for this level of service.

The three key priorities should be 1) More effective targeting of NRBs in Europe and the US to add on a trip to Cox’s Bazaar or the Sunderbans rather than stay in Dhaka. This involves targeted advertising in Bangladeshi media abroad as well as effective marketing by Embassies; 2) Develop a joint venture with a foreign marquee chain such as Westin, Hilton or Four Seasons to establish resorts here. The skill transfer and marketing leverage will be considerable; 3) Ensure investment in infrastructure both in terms of the resorts themselves, transport to destinations and things to do when holidaymakers get there. Integration into a Saarc regional tourism strategy whereby holidays to Nepal can be combined with Bangladesh, for example, may also be attractive.

A targeted and viable tourism strategy is critical, but I would reiterate the benefits of a strong culture of customer service to the wider economy perhaps tourism could be the catalyst for us to emulate international standards across sectors from retail to leisure.

The writer, Ifty Islam, is the managing partner of Asian Tiger Capital Partners and former managing director and head of Global Macro Strategy at Citigroup, London. Ifty.islam@at-capital.com

This article is quoted from Daily Star . The article was originally published on 2008-06-05. This article is uploaded by Majbritt Thomsen, administrator on ‘Views On Tourism’.

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Posted in Bangladesh, Development, Performance and management.


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