FDI prerequisite for Bangladesh to leap into a middle-income country: Speakers

Bangladesh still faces several challenges in doing business that affect domestic and foreign investment, despite the progress made over the last two decades in the ready-made garments (RMG) sector.

Edimon Ginting, country director of Asian Development Bank Bangladesh, made this statement while giving a keynote presentation on "Enhancing Investment Policy Framework to Catalyse Private Investment in Bangladesh", at the monthly luncheon meeting of the Foreign Investors' Chamber of Commerce and Industry (FICCI) on Monday at a hotel in the capital.

There is a need for significant liberalisation of different verticals to attract investments while simplifying the acquisition of land, protecting intellectual property rights, and simplifying and making the tax regime competitive, he added.

Lokman Hossain Miah, executive chairman of Bangladesh Investment Development Authority (BIDA) spoke at the event as the chief guest.

Myung-Ho Lee, president of Japan Bangladesh Chamber of Commerce and Industry (JBCCI) and Dr. M. Masrur Reaz, chairman and founder of Policy Exchange Bangladesh participated in the discussion as panellists.

The session was moderated by Mahbub Ur Rahman, director of FICCI Board and CEO of The Hongkong and Shanghai Banking Corporation Ltd.

In his keynote presentation, Edimon mentioned, "In 2022 manufacturing activity grew from 5.5 per cent of GDP at independence to 22 per cent, expanding particularly over the last decade. Growth was driven particularly by the export oriented RMG sector, which employs more than 4.0 million people directly. RMG accounted for 12 per cent of the GDP and 84 per cent of exports in the same year."

He described some challenges related to impending LDC graduation, such as loss of preferential market access in export destination markets, loss of LDC-exemption under the WTO agreement on subsidies and countervailing measures, loss of special and differential treatment under the Trade-Related Intellectual Property Rights (TRIPS) agreement, and access to development assistance financing that should remain broadly intact or may evolve to slightly less favourable terms.

Panel speakers Myung-ho Lee, board member and chairman, Investment Climate Committee, FICCI and president, JBCCI stated the need for investment protection, the Double Taxation Avoidance Treaty and the EPA to accelerate Japanese investment, while Masrur Reaz, chairman and CEO, Policy Exchange Bangladesh, reiterated the need for moving competitiveness-based value propositions while we engage on the strategic levers for FDI/investment promotion and improve the investment policy framework.

FICCI President Zaved Akhtar said, "The tale of our country's development has been significantly driven by trade and an increase in private investment. After achieving high GDP rates of around 6.0 per cent over the last two decades and remarkable progress in poverty reduction and human development, the nation is now at a crossroads where it needs to ensure disruptive investments to realise the aspiration of achieving a high-income status by 2041."

"To achieve Vision 2041, private investment as well as revenue collection will need to be boosted for vital resource allocation in crucial sectors while we simplify and transform our tax and regulatory regime to build the overall credibility and predictability of the country while building the capability of human capital by leveraging.

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