Pandemic may cast a pall on FDI
The rising trend in foreign direct investment (FDI) for Bangladesh may decelerate this year as a result of economical fallout of the coronavirus outbreak, authorities believe.
"The ongoing Covid-19 pandemic will surely hamper the inflow of FDIs for the united states," said Sirazul Islam, executive chairman of Bangladesh Expenditure Development Authority (BIDA).
The full total value of FDIs produced around the world will witness a 20 % fall by the finish of 2020 because of the emergence of the deadly contagion, according to a projection of the United Nations Conference on Trade and Development.
Insurance plan discussions on long-term answers to attract extra foreign investment are had a need to happen, Islam said.
BIDA has recently taken some initiatives found in this regard and recommended numerous amendments to some restrictions that are directly linked to FDI, he added.
The prime minister already sat with a few senior secretaries from the overall Economic Division, Finance Division and the National Board of Revenue to look for a solution to the problem, Islam added.
The Covid-19 outbreak will slow the rate of investment in general, but it will be particularly detrimental to FDIs as foreign investors come to mind about the health risks, said Khondaker Golam Moazzem, research director at the Center for Policy Dialogue.
Investors who all were previously keen to invest in Bangladesh might reconsider their plans as a result of latest economic uncertainty brought on by the pandemic aswell, he said.
"Investors definitely avoid taking chances and so, the whole world will suffer as a result of this."
There is absolutely no way to recover the quantity of FDIs lost during this time period either, he said.
Similarly, Ahsan H Mansur, executive director of the Policy Exploration Institute, said there will be a shortage of FDIs this season as a result of global financial impact of Covid-19.
"We must accept this reality as protecting individual life may be the top priority currently," Mansur said.
The executive director also said too little proper infrastructure is a major barrier for attracting more FDIs to the united states.
There are various mega infrastructure projects in a variety of stages of implementation across the country but even those are actually enduring slow progress because of the pandemic.
Foreign investment in Bangladesh fell over 40 % year-on-year to around $2.15 billion in the January-September period in 2019, according to Bangladesh Bank data.
Of the $2.15 billion, $602.79 million visited equity, $999.78 was for reinvested income and the rest of the $551.29 million was in intra company loans.
However, it is worthy of mentioning that FDIs worthwhile $2.58 billion found Bangladesh in fiscal year 2017-18, which jumped to $3.88 billion in the next fiscal year, registering a 50.71 % increase, according to Bangladesh Bank info.
Since achieving independence, Bangladesh has received a complete of $17.31 billion in FDIs, the central bank info shows.
