Outgoing German Ambassador to Bangladesh Holger Michael, who is
going back after three years in Bangladesh, talked to The Daily Star on
a wide range of bilateral, regional and international issues of common
concern. In an exclusive interview with The Daily Star's Diplomatic
Correspondent Rezaul Karim at his office recently, he talked about 2014
general election, investment climate, the civil society, corruption and
secular policies in Bangladesh. Following are excerpts from the
interview.

The Daily Star (TDS): Germany and
Bangladesh are traditionally bound by very friendly relations. How do
you foresee the bilateral relation moving ahead in the future?

Holger Michael (HM):
I expect our excellent relations from the last 40 years will continue
to flourish. The foundations were laid in the past and in the last two
years we experienced a strong increase in political, commercial and
cultural exchanges between our two countries.

Your foreign
minister visited Germany twice. Our Minister for Economic Cooperation,
together with the Commissioner for Development Cooperation from the
European Union, visited Bangladesh last summer. Last October, your prime
minister visited Germany and held talks with our political leaders
including Chancellor Merkel and Foreign Minister Westerwelle. She also
attended a very successful business meeting in Berlin organised by the
Bangladesh-German Chamber of Commerce, bringing together 300 business
people and investors to listen to the prime minister. Then German
Federal President Wulff came to Bangladesh on an official visit last
November, marking a highlight in our political and diplomatic relations
of the last 20 years.

We are now expecting the visit of German
Foreign Minister Dr. Guido Westerwelle on June 23. He follows an
invitation from Dipu Moni. The visit will carry the message of forty
years of diplomatic relationship, partnership and friendship. The visit
also underlines the German commitment to continue to cooperate with
Bangladesh and to support Bangladesh in its quest to become a middle
income country.

TDS: As one of the world's top countries
in the field of engineering, how can Germany help Bangladesh in its
technological advancement? Does Germany have any plan to further expand
technical support and training to Bangladeshis?

HM:
Since 40 years we have had very close economic and technical
cooperation. Germany has its own implementation agency, the GTZ. Their
180 experts are active in the health, good governance and energy
efficiency sectors. We shall continue this excellent technological
cooperation in the future. Over the years our two countries have
established trust and confidence in our development cooperation. I wish
to mention as a token of our mutual confidence the prison reform
project, which fights overcrowding in prisons and helps the prison
administration in identifying who should be in prison or who should not.
Though it is a sensitive area of governance, the government of
Bangladesh invited Germany to assist. This is a sign of mutual
confidence and also of responsible farsightedness of the authorities
concerned. In addition, the German Development Bank KfW office in Dhaka
provides tailor-made financial assistance to achieve our agreed
development objectives. In total, Germany provided €2.5 billion as
technical and financial assistance during the last 40 years. This money
came as a grant, nothing has to be paid back. Very soon, for the first
time ever, we will have a project with mixed financing where government
money will be combined with bank loans to leverage the amount of money
which can be actively used for the development of Bangladesh.

TDS:
Are there any plans to increase German investment in Bangladesh? What
ways are there to boost Bangladeshi exports to Germany? What benefits
does Germany offer to these exports?

HM: German
investment in Bangladesh is already at a reasonable good level. More can
be done. In the last two to three years there has been an increase in
the interest of German companies. We already have investments not only
in RMG, but also in cement, automotive supply, ship building and in many
trade related services like certifying institutes for the quality of
products exported from Bangladesh. We see a strong increase in
investments in logistics. Several globally leading German logistic
companies have established their regional distribution centres in
Bangladesh. Also, there are now cargo planes flying directly from
Germany to Dhaka and back thrice a week to cater to our increased trade
and investment. Germany is prepared to invest in the areas of energy,
power plants, and renewable sources of energy. The latter is an area
where Germany traditionally has high technological competence. Last
year, German electricity production from wind parks was as high as from
nuclear power plants.

If the dictum "investments follow trade" is
true, we envisage great prospects. Germany is the second largest export
market for Bangladesh and our bilateral trade increased by almost 80 %
in the last three years. Bangladesh German Chamber of Commerce and
Industry (BGCCI), the biggest bilateral chamber in Bangladesh with more
than 300 members, proved to be a very active growth machine for our
business relationship. I also appreciate that BGCCI is actively branding
Bangladesh in Germany in order to improve the reputation of Bangladesh
as a business location

TDS: As Ambassador of Germany,
what would you say are the potential sectors in Bangladesh wherein
German companies will be willing to invest money?

HM:
We have e.g. an exciting and forward looking investment project in
shipping, intending to establish a container shuttle by ship between
Chittagong and Dhaka in order to get the containers off the road and on
the water instead. A German company specifically designed a high-tech
ship for this route with state of art technology, which will be produced
in Bangladesh, thus transferring the latest technology to Bangladesh.
It could be a wonderful win-win situation. Unfortunately, this project
is being delayed by bureaucratic obstacles. Nevertheless, we hope that
it will be realised.

As a matter of fact, German investors are
looking forward to invest in and cooperate with the private sector
particularly. German businesspeople appreciate their Bangladesh
counterparts and love to do business with them, provided the proper
framework conditions are in place. I too have met a large number of
outstanding and wonderful businessmen as well as women, and I am sure
that their commitment will advance Bangladesh.

TDS: What are the areas that yet remain untapped and how can Bangladesh and Germany explore those areas?

HM:
Let me talk about culture and education. We are present here with a
dynamic Goethe Institute in Dhanmondi. We have introduced German as a
foreign language into the education system as an opportunity to learn a
foreign language, which is essential for any economy wishing to
globalise. Then, there is a group of Bangladesh entrepreneurs,
scientists and professors who plan to establish a German University in
Bangladesh based on a German-Bangladesh curriculum. If this succeeds, it
will be a great step forward in our scientific and academic exchange.

TDS: What do you think are the obstacles that hinder foreign investments?

HM:
It is certainly the lack of energy and difficulties in transportation.
Seen from abroad, unrest, violence and hartals -- coming from whatever
side -- are likely to disrupt movements of goods and persons in the
country. For Bangladesh, which is increasingly becoming an important and
integrated part in the international supply chains, reliability in
sustaining the supply chain and its integrity is very important. Foreign
investors consider governance, including corruption, as another major
problem. When German business people come and see me, asking for advice,
they say they are worried about reports of corruption made by renowned
international organizations, and also about the reported lack of legal
recourse in case of disputes.

TDS: What is your suggestion? How can Bangladesh overcome these obstacles?

HM:
With regard to energy, the government has plans to establish power
plants, establish connectivity with neighbouring countries in order to
be able to trade energy, expand and modernise distribution networks,
explore for more gas fields, etc. The implementation of these plans
would be a tremendous step forward.

With regard to governance, the
consensus of the whole society is required to ban nepotism and
corruption. It is the task of the whole society to eradicate or at least
minimise these evils.

TDS: As one of the leading
development partners, Germany provided huge amount of grant assistance
for the development of Bangladesh. Do you think the grant money is being
utilised properly and your government is satisfied with the
utilisation?

HM: There is an active discussion
about the extent of utilisation of foreign money. As I said before,
Germany is present in Bangladesh with our own implementation
organisation, the GIZ, which has an excellent reputation and which
implements, together with our Bangladesh partners, our joint development
projects. Because of this form of cooperation, Germany faces fewer
problems with the implementation of projects and we are happy with our
development cooperation.

TDS: How will you evaluate the anti-corruption watchdog ACC? Do you think it is strong enough to combat corruption?

HM:
I do not wish to comment on single Bangladesh institutions. In general,
an efficient and independent ACC is a great asset for any country in
the world, and it constitutes a major point of attraction for foreign
investments.

TDS: What is your view on the current
political situation in Bangladesh? How do you look at the question of
the method of holding of the next general election?

HM:
As any election, the forthcoming election in 2014 will have to be
free, fair, equal and inclusive. The method by which the election will
be carried out is the exclusive decision of Bangladesh and its people.
Foreign observers have no say in it.

TDS: How do you see the human rights situation in Bangladesh?

HM:
We call for the respect and implementation of human rights. These are
universal rights and they have to be respected in any part of the world.
We urge all the governments to respect HR and enforce HR as universal
rights.

TDS: How do you see the present government's efforts in curbing militancy, terrorism, etc?

HM:
The measures taken by Bangladesh in curbing terrorist activities are
certainly appreciated. I encourage all nations to defend their integrity
against terrorism.

TDS: How can Germany cooperate with Bangladesh in tackling the impact of climate change in Bangladesh?

HM:
We are cooperating in several areas of disaster preparedness, building
shelters in the coastal area, and fighting deforestation and similar
activities. In the larger context of the energy sector, Germany together
with IDCOL provides solar energy to hundreds of thousands of households
in rural Bangladesh. These households can enjoy electricity in the
evening and less wood is needed for fire. It is hence an indirect
contribution to preserving the forests and the environment. Moreover,
children can study and parents can work in the evening.

We very
much commend Bangladesh's leading and responsible role in international
climate negotiations and as a spokesman for the most affected countries.
I am glad to see that we have many positions in common and that we
share the responsibility to protect the environment for the generations
to come.

TDS: What impressions are you taking back home about Bangladesh?

HM:
I have a very positive feeling about Bangladesh. From the very first
day, I was impressed by the hospitality and welcome by Bangladeshis. It
is a liberal society. I have been impressed by the strength and the
positive contribution of civil society to the development. It is an
asset that should be nurtured and nourished and utilised for the full
benefit of the people.

Today's Bangladesh is a very open society.
Bangladesh is my fourth posting in an Asian country and I enjoy the
openness. Never before did I meet as many citizens and partners who are
prepared to listen and to debate, to exchange views so openly. The
quality of discussions as well as the high number of really good and
dear friends in Bangladesh made the years in Bangladesh for my family
and me very, very rewarding.

TDS: You came three years ago. Do you see any positive change happening in Bangladesh?

HM:
I recognise a number of institutions in this country that promise to
contribute to the democratic development, such as the Anti-Corruption
Commission, National Human Rights Commission and Information Commission.
The more space, support and independence they enjoy, the more important
for the democratic development of this country they will become. I was
hoping to witness a political debate in this country, which is
commensurate with its noble tradition of philosophy and culture. Of
course, each country chooses its way to conduct the political discourse.
The German people, as an example, rely strongly on the Parliament as
the place to exchange conflicting political views. And we have very good
experiences with Parliament as the forum for all parties to voice their
opinions, for which they had received the mandate through elections. We
see a working parliamentary democracy as a treasure to be used in
response to the expectations of the citizens.

I am fascinated by
the secular policies in Bangladesh. It is a great asset for the society.
In the last decades, no major religious-based confrontations took
place. Harmonious coexistence of people is a wonderful thing.
Inter-faith dialogue, mutual recognition of being of different faiths,
and respect for these differences, are very commendable. When one
religion celebrates its holiday in Bangladesh, members of other
religions come and enjoy. This trait could also be used for branding of
Bangladesh, showing that it is a secular society without religious
conflicts. Also women empowerment, activating the productive force and
giving women the opportunity to be active members of the society, are
great assets of Bangladesh and contribute to a well diversified and fair
image.

TDS: How do you assess the present India-Bangladesh relationship?

HM:
I think Bangladesh can play a very positive role in the region, and can
help to stabilise it and foster inter-regional cooperation and
connectivity. From our European experience, regional cooperation
benefits all the states, be they small or large. The exchange of goods,
services and capital works as a stimulus to both economy and societies
in the region.

TDS: Economic recession continues to batter economies in Europe. How has the German government been dealing with it?

HM:
After a number of years of sluggish growth, Germany reacted with belt
tightening and measures to increase competitiveness. We now enjoy a
relatively strong growth estimated at 2.5% this year. Germany's
unemployment is at an historically low rate. Exports as well as imports
continue to increase. Due to the high import content of the German
economy, the growth of German exports induces huge additional imports,
thus stimulating and supporting the economies of our partners,
particularly in Europe. I believe that a sustainable growth of the
German economy is thus a very welcome support for the efforts to
stabilise the European markets. Of course, Germany also contributes to
the different mechanisms to help to stabilise the Euro zone.

TDS:
Germany remains the strongest economy in Europe. Given such a position,
how does it look at the rising economic clout of China and India?

HM:
Germany is very happy about economic development of Asian countries
like China, India and, of course, also Bangladesh. Being a good and
reliable business partner with these countries, growth in these
countries means a strong increase of German imports and exports. In the
case of China, German machine tools exports supply China with the
technology that supports the Chinese export success story. Also, in the
bilateral trade with Bangladesh, Germany exports mainly machinery, which
can be seen as a promising indicator for Bangladesh technologically
upgrading its economy. In the years to come, production will become more
competitive quality-wise in the world markets.