Investment climate needs to improve to attract FDI

This letter is in reference to the article titled 'Norway wants to invest more in Bangladesh' that was published in the Financial Express on November 14, 2018.

Following a meeting with Norwegian Ambassador to Bangladesh Sidsel Bleken, Commerce Minister Tofail Ahmed told the media on November 13 that Norway is seriously thinking about making more investments in Bangladesh in the near future.

Already Bangladesh enjoys special trade benefits under Norway's Everything But Arms (EBA) scheme. In the last fiscal year, Bangladesh exported goods worth US$ 96.85 million to Norway. In return, Bangladesh imported goods totalling US$63.70 million from the country.

It is expected that the export volume from Bangladesh to Norway will increase in the coming years.

Most likely the Norwegian government is content with the performance of some 13 companies operating in Bangladesh at the moment including Grameenphone.

This is a positive development for Bangladesh as the country needs more Foreign Direct Investment (FDI).

According to a government estimate, Bangladesh needs to attract an annual FDI of $ 6.70 billion on average in order to graduate from the lower-middle income status by 2021.

However, a Bangladesh Bank (BB) data released in April showed that FDI inflow had declined by 13.50 per cent to $2.02 billion in 2017. This was $2.33 billion in 2016.

Economist Zaid Bakht explained to a newspaper few months back that foreign firms usually observe the situation of local investment in a country before considering an investment plan. Also, Bangladesh dropped to 177th position in the Ease of Doing Business Index, a global ranking of economic stability, in 2017 from 176 in 2016. The government and apex trade bodies should come up with policies and strategies that can improve the local credit flow, local investment and also improve the ease of doing business in the country.

This will surely bring in more FDI in the long run.

Naila Hossain,

Uttara, Dhaka