Bangladesh has been ranked 114th among 141 countries in terms of Foreign Direct Investment (FDI), according to the World Investment Report.
The 21st World Investment Report 2011, published recently by the United Nations Conference on Trade and Development, showed that Bangladesh's ranking, which was 120th in 2009, has improved slightly in 2010.
The FDI in 2010 grew by 30 per cent to $913 million, up by $213 million over the previous year but lower by $173 million in 2008.
Much of the FDI however, went to acquisition of old assets rather than setting up Greenfield companies.
BoI executive chairman S A Samad while unveiling the investment report said it was up to the foreign companies to decide whether to purchase the existing companies or set up new ventures.
He acknowledged that FDI flow in acquisition did not help enlarge the economy.
SA Samad said that the country should receive $5 to $6 billion of FDI annually as it has a rapidly growing economy with an extensive market.
He identified political unrest, military intervention, incompetent public sector, obstructive bureaucracy and natural disasters as some of the factors that discourage FDI in the country.
He said that the investment procedure, which needed the approval of several authorities from the Prime Minister's Office to the secretariat, was very complicated and prolonged.
But he thought that the FDI would increase in the future as risk and uncertainty were being reduced gradually.
In the total FDI in 2010, around $360 million, of which $317 million came from Singapore alone, was invested in the telecommunications sector.
About $145 million was invested in textiles, $163 million in banking and $92 million in power and energy, investment increasing by 41 per cent in the four sectors over 2009.
But the report said that investment in food production decreased from $24 million in 2009 to $12 in 2010.
The report also said that the country ranked 2nd after Maldives in terms of inward FDI growth. India and Pakistan were declining in position and Sri Lanka was improving.
'Bangladesh has done well regarding FDI compared with other South Asian economies such as India and Pakistan,' said Professor M Ismail Hossain of Jahangirnagar University while highlighting the salient features of the report in the BoI's boardroom today.
The report said that foreign investment increased by 5 per cent worldwide in 2010, which was less by 37 per cent compared to investment in 2007.
The total registered foreign investment in Bangladesh in 2010, which amounted to $3,138, increased by 372 per cent over the previous year.
Local investment in 2010, which was $6,276, was 142 per cent more than that of the previous year.
Chairman of Privatisation Commission of Bangladesh Dr Mirza Abdul Jalil, member (engineering) of Bangladesh Export Processing Zones Authority Abu Reza Khan, representatives of Bangladesh Bank and concerned officials of various agencies were present on the occasion.
Source : New Age
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