Despite offering lucrative incentives, Bangladesh has failed to prove itself as an attractive investment destination. The volume of FDI (Foreign Direct Investment) has also remained low compared to those of the neighbouring countries. Financial analysts and businesspeople at a seminar expressed on Thursday the view identifying lack of policy consistency, underdeveloped infrastructure, lack of power and energy, scarcity of land, lack of good governance and deteriorating law and order situation as some major problems hindering foreign investment in the country.”The government should settle the issue of KEPZ (Korean Export Processing Zone) immediately. It is tarnishing our image home and abroad and giving wrong signals,” said Bangladesh Economic Association (BEA) General Secretary Dr Jamaluddin Ahmed while addressing the seminar on “FDI and another Major Determinant of GDP: A Relationship Analysis” at the Board of Investment (BoI) office on Thursday. Jamal, also a former president of the Institute of Chartered Accountants of Bangladesh (ICAB), pointed out that a large amount of foreign investment is waiting but the country fails to attract the same mainly due to policy constraints accompanied by bureaucratic bottlenecks. “You are good theoretically, but in reality it is quite difficult to invest in your country,” said Jamal quoting some foreign buyers whom he had encountered recently at an international seminar. To attract more FDI into the country, he said, the government should put in place incentive packages with wide-ranging investment-friendly support measures. The prevailing incentives, together with market-oriented reforms, significant socio-economic achievements and highly favourable demography, can make the country one of the attractive investment destinations. BoI executive chairman Dr SA Samad, who moderated the programme, pointed out that the government had undertaken a number of reform programmes including automation of some supportive services to facilitate investors for getting more quality, fast and coordinated services. Bangladesh, according to him, has made significant achievements in many areas of social indicators including education and health, but many challenges still remain because certain other elements for a strong capital base are missing. “How the capital base will be formed where more than 70 per cent of budget is spent for consumption and only 30 per cent is spent for development which is also poorly planned and implemented more disappointingly,” said the BoI chief. The BoI executive chairman also agreed with Dr Jamal relating to policy inconsistency and also urged all concerned to create pressure on government to resolve the KEPZ problem as early as possible. According to sources, some influential people have allegedly grabbed a portion of KEPZ in Chittagong, halting the development work of the zone. The incident has created tension in the country’s largest private EPZ. The seminar held at the BoI conference room was addressed, among others, by Bangladesh Overseas Employment and Services Ltd (BOESL) Managing Director Md Abdul Hannan, Notre Dame University Economics Department Chairman Md Azizur Rahman, BoI Executive Members Nabhash Chandra Mandal and Salma Nasreen, DCCI Vice President Shoaib Choudhury and MCCI Trade and Investment Facilitation Cell Deputy Chief Abdur Rahman. BoI Deputy Director Sonjoy Chakraborty presented the keynote paper on the subject as part of his doctoral dissertation. Sonjoy in his paper focused on various aspects of FDI, especially on its technical analysis, trend, growth and other variables like export, import, remittance etc. Speakers at the seminar also stressed the need for investing the hard-earned remittances of Non-Resident Bangladeshis (NRBs) in productive sectors to give a boost to the economy. “Remittances are being used for consumption and purchasing lands, which are not productive,” said the BOESL Managing Director. He stressed the need for making the remittance earners literate about the productive use of their hard-earned money. They also emphasised the need for access to education to create a workforce with skills and knowledge needed for a healthy investment climate. Because of the skill-based knowledge and language efficiency, workers from India, Sri Lanka and the Philippines are earning much higher wages than those from Bangladesh, they pointed out. According to the recent UNCTAD (United Nations Conference on Trade and Development) report, the inflows of FDI in Bangladesh fell in 2014, in five years, by 4.5 per cent to US$ 1.5 billion despite a relative political calm. The UNCTAD in its report described it as a sign of slowing growth in the country’s equity investment. The BoI chief, even on Thursday, didn’t agree with the findings and put up an alternative estimate that claims a rather rise in gross FDI inflows. According to the BoI estimation, Bangladesh’s gross FDI stood at $ 2.58 billion.
