The Bangladesh Freight Forwarders Association (BAFFA) has urged the government not to allow 100 per cent foreign ownership in the freight forwarding and logistics sector, saying the move is based on “misleading and incomplete information”.
In a letter to the Investment Bangladesh Authority (IBA) executive chairman on 24 September, BAFFA rejected a reported claim by a senior IBA official that the sector remains largely manual and that greater foreign participation would improve efficiency, transparency and competition.
The association termed the claim “baseless and detached from reality” and said major global freight forwarding and logistics companies are already operating in Bangladesh through wholly foreign-owned entities or joint ventures with local partners.
BAFFA said Kuehne plus Nagel, DHL Global Forwarding, DSV, Expeditors, APM Global Logistics, Agility, Geodis and Yusen Logistics are registered as fully foreign-owned entities, while Nippon Express, CEVA, Toll, Dachser, Schenker, Aramex, Delmar and Kintetsu operate through joint ventures.
“There is no barrier to the entry of the world’s leading freight forwarding companies. They are already here,” the association said.
BAFFA also disputed the claim that the industry relies largely on manual systems, saying local freight forwarders use international software including CargoWise, SAP HANA, Oracle SCM, Descartes, Magaya and Logi-Sys.
It said operators are digitally connected with customs, ports, shipping lines and airlines through systems such as ASYCUDA World, EDI manifests and electronic air waybills. They also use cloud-based warehouse management systems, GPS and IoT-enabled cargo tracking systems.
The association argued that unrestricted foreign ownership would not necessarily bring new technology, expertise or global networks to the sector. Instead, it warned that small and medium-sized local operators could lose market share to financially stronger foreign companies.
BAFFA also said existing foreign partners in joint ventures could shift to wholly owned subsidiaries, putting local investment and equity at risk.
More than 1,000 locally licensed freight forwarding firms operate in Bangladesh, most of which are small and medium-sized businesses, the association said.
It also warned that as freight forwarding is an asset-light service industry, full foreign ownership would not necessarily bring large fixed investment, while profits, royalties and consultancy fees could be remitted abroad in foreign currency.
BAFFA called on the IBA to hold formal consultations with industry representatives before changing the policy and reiterated its demand to retain a minimum 60 per cent local ownership requirement in freight forwarding rules.
