The country has missed the opportunity to get rid of a losing concern and accept $50m foreign investment because the cabinet could not make a policy decision at the eleventh hour of the previous government’s tenure.
According to documents seen by the Dhaka Tribune, The Coca-Cola Company (TCCC), based in Atlanta, Georgia in the US, was ready to pay $16m to clear off all the outstanding dues of Tabani Beverage Co Ltd of Bangladesh, one of the franchisees of Coca-Cola in this country.
After all the dues with Tabani were cleared, the TCCC wanted to invest another $50m (Tk3.89bn) to freshly start the production of Coca-Cola in Bangladesh.
However, sources said despite being acknowledged by the prime minister and approved by the finance minister, and even though there was still time before the polls-time government took over, the cabinet could not make a decision to give the go ahead to the TCCC proposals.
As a result, the lucrative deal for the country had been plunged into uncertainty, especially amid the political turmoil, sources said.
Tabani Beverage, a concern of the Muktijoddha Kallyan Trust (the freedom fighters’ welfare trust) under the Ministry of Liberation War Affairs, ceased manufacturing and bottling Coca-Cola in Bangladesh in 2008 due to heavy losses and after failing to meet global standards.
Sources also said the cabinet could not decide on the deal, especially before the elections, because it was connected to the highly sensitive national issue of the freedom fighters, who might have thought that their property was being sold off to a foreign company.
Pran RFL, in addition to Abul Monem Group, which has been the other franchisee of Coca-Cola since 1978, has been manufacturing and bottling Coca-Cola. Although Tabani has not been in operation, the government has kept on duly paying the salaries of the employees and staffs of the company for three years.
Sources said the TCCC had registered a Tk50m investment proposal with the Board of Investment of Bangladesh in 2010. Before making the investment, the company expressed its willingness to pay Tk16m to clear off the outstanding debts of Tabani.
According to documents, in March 2010, the cabinet committee formed a three-member review committee headed by Mashiur Rahman, the then economic affairs adviser to the prime minister. The committee was tasked with giving recommendations about how to best use the money that the TCCC intended to pay.
According to the minutes of a meeting held on October 23, 2013, the review committee gave the go ahead to the investment proposal and set out specific recommendations about how the initial $16m could be used for the welfare of the freedom fighters, and rejuvenating the Muktijoddha Kalyan Trust and its subsidiaries.
In line with the committee’s recommendation, the Ministry of Liberation War Affairs sent a summary to the prime minister on November 6 which said the road for the government was clear for accepting TCCC’s investment proposals.
That summary contained a handwritten recommendation from Finance Minister AMA Muhith.
On November 11, KH Masud Siddiqui, secretary of the Ministry of Liberation War Affairs, sent a summary to the cabinet committee on economic affairs for considering the investment proposal.
Although the cabinet committee sat three times from November 11 to the swearing in of the polls-time cabinet on November 21, it could not make any decision on the investment proposal.
The committee sat several times after the swearing in, but since the interim cabinet was not supposed to make any policy decision, the deal virtually sled into oblivion.
Coca-Cola started business in Bangladesh with an agreement with Tabani Beverage, owned by a Pakistani national, in 1965. After independence, Tabani was put under the freedom fighters’ welfare trust.
