Strong political will is essential to implement and make the proposed Special Economic Zones (SEZs) a success in Bangladesh, according to a leading economist of the country.The commitment should be reflected in political stability and avoidance of economic policy reversal as these two can ensure the success of the SEZs.Dr Selim Raihan, a professor of economics in Dhaka University, made these observations on Sunday while presenting his study findings on SEZs and Foreign Direct Investment (FDI).”There is a need for strong commitments from the political elites in Bangladesh for necessary economic and institutional reforms towards realising the bright prospects of SEZs,” he said at a press briefing organised by the South Asian Network on Economic Modelling (SANEM).The briefing was organised to present the study titled ‘What needs to be done to make Special Economic Zones (SEZs) successful and to attract large Foreign Direct Investment (FDI) in Bangladesh’Dr Raihan, also the executive director of the SANEM, argued that SEZs can generate both static and dynamic benefits.”Static benefits include employment creation, export growth and rise in government revenues; whereas dynamic benefits include economic diversification, innovation and transfer of technology through foreign direct investment and skills upgrading,” he explained.He also said that Bangladesh Economic Zones Authority (BEZA) was instituted by the government in November 2010, based on the Bangladesh Economic Zones Act, 2010, with the aim of establishing 100 SEZs across the country by 2030.”The importance of SEZs, aimed at propelling both domestic investment and FDI for rapid and sustained economic growth in Bangladesh, can’t be undermined,” he added.To make the SEZ initiatives successful, the economist presented eight-point recommendations including better standards of infrastructure and business environment within SEZs, better connectivity with sea and land ports, emphasis on production of high value-added and diversified products, competent institutions governing the operations of SEZs and strong political commitments.Regarding FDI, Dr Raihan said that to attract FDI, relevant trade policy reforms leading to higher degree of openness are essential.Dr Raihan, quoting from his research, said that in a ranking using the average of latest five years (2011-2015) FDI-GDP data for 179 countries, Bangladesh appeared to be 149th with the FDI-GDP ratio of only 1.4 per cent.He also said that infrastructural development, the magnitude of domestic investment and government’s stability are crucial to attract FDI in the country.In this regard, he mentioned two aspects of the government’s stability. These are political stability and stability in economic policies.”It has to be ensured that the country is not in political conflicts which can affect business operation and planning,” said Dr Raihan. “Also, ensuring stability in economic policies with no policy reversals and continuation of progressive economic reforms is immensely important.”Among others, Dr Farazi Binti Ferdous, fellow of SANEM, was also present at the press briefing.
