Clear strategy needed to increase business confidence: UK envoy
Monday, 29 October 2007
FE Report
British High Commissioner (HC) Anwar Choudhury said Sunday foreign investments in Bangladesh are at a standstill as 'pent-up decisions continue to mount'.
"Investors are now unclear about the future, they lose patience and go elsewhere or stay adding up costs which will eventually have to be recovered," Choudhury said while addressing the monthly luncheon meeting of Foreign Investors' Chamber of Commerce and Industry (FICCI) as the guest of honour at a city hotel.
He said a clear strategy and action is needed to increase business confidence.
President of FICCI Masih Ul Karim delivered the address of welcome on the occasion.
"We, foreign friends, are ready to invest as we see the country's potentialities since prosperity is the best guarantee to democracy and stability," he said adding "Bangladesh's political transformation has to be underpinned by business and investment."
"The establishment of Better Business Group is welcome but action is slow and energy is low," he said.
Demanding critical action in the energy sector, he said: "The foreign investors hail the coal policy but need the decisions."
"Gas exploration is a must. Too much talking in the past and we forgot to explore," the British HC said.
He said this is the time to put things right for the caretaker government, which has to find the best match for national and investment interests.
Welcoming the intention to set up an anti-regulation committee, the UK envoy said a good person with adequate power is needed.
On the civil administration, he said civil servants must be directed and rewarded to make decisions that bring in investments now.
"There should be action against those who sit on the fence for no good reason".
The British HC said the ongoing crisis in power and energy will see a further worsening situation unless the government takes prompt decision on the proposed investment offers from foreign investors.
Praising some of the steps taken by the present government to improve governance, Choudhury, the Bangladeshi-born UK diplomat said : "The action is still slow, so a decisive strategy is urgently needed to boost the confidence of businesses and accelerate the pace of the economic development."
He said a bad image has affected the readymade garment (RMG) industry though it is the top earning source of Bangladesh's foreign exchange.
"Bad publicity on social compliance, increased competition and attractiveness of other markets are leading to half filled order books or worse," he added.
He said professionalism is the way to remain competitive in the business-not just costs.
He said the UK is one of the largest investors in Bangladesh with $ 4.0 billion investment and more $ 2.0 billion investment proposals are in the pipeline
"In due course and over the coming months, I hope more and more UK companies will visit Bangladesh to do business and form relationship with their Bangladesh counterparts, but the perception of Bangladesh remains a barrier," Choudhury said.
He said whenever the word Bangladesh is mentioned it conjures up negative images within the business community.
"Just as Bangladesh is lifting itself from the bottom of the corruption list, it can do the same with business and investment, in fact it must," the British HC asserted.
Commenting on the anti-graft drives, he said there seems to be strategic action on everything but trade and investment seen to be suffering from an unforeseen and paradoxical consequences.
"The anti-corruption drive has upset the old ways, the old system of understanding, and this has led to near collapse in business confidence as people sit on the fence to discover how and if the new system will work and sustain," he said.
Choudhury said: "As a result of this and other factors, economic growth this year is predicted to be lower, may be up to 2.0 per cent lower."
The UK government considers Bangladesh's power, ports, ICT, environment, textiles, ceramics and pharmaceuticals as the key sectors for investment.
The FICCI chief welcomed the recent move on floating Bangladesh Business Forum.
"Tax evasion and unethical businesses are still the biggest threat to FDI flow in Bangladesh," he said.
FICCI Vice President Rudolf P Klink offered a vote of thanks.
British High Commissioner (HC) Anwar Choudhury said Sunday foreign investments in Bangladesh are at a standstill as 'pent-up decisions continue to mount'.
"Investors are now unclear about the future, they lose patience and go elsewhere or stay adding up costs which will eventually have to be recovered," Choudhury said while addressing the monthly luncheon meeting of Foreign Investors' Chamber of Commerce and Industry (FICCI) as the guest of honour at a city hotel.
He said a clear strategy and action is needed to increase business confidence.
President of FICCI Masih Ul Karim delivered the address of welcome on the occasion.
"We, foreign friends, are ready to invest as we see the country's potentialities since prosperity is the best guarantee to democracy and stability," he said adding "Bangladesh's political transformation has to be underpinned by business and investment."
"The establishment of Better Business Group is welcome but action is slow and energy is low," he said.
Demanding critical action in the energy sector, he said: "The foreign investors hail the coal policy but need the decisions."
"Gas exploration is a must. Too much talking in the past and we forgot to explore," the British HC said.
He said this is the time to put things right for the caretaker government, which has to find the best match for national and investment interests.
Welcoming the intention to set up an anti-regulation committee, the UK envoy said a good person with adequate power is needed.
On the civil administration, he said civil servants must be directed and rewarded to make decisions that bring in investments now.
"There should be action against those who sit on the fence for no good reason".
The British HC said the ongoing crisis in power and energy will see a further worsening situation unless the government takes prompt decision on the proposed investment offers from foreign investors.
Praising some of the steps taken by the present government to improve governance, Choudhury, the Bangladeshi-born UK diplomat said : "The action is still slow, so a decisive strategy is urgently needed to boost the confidence of businesses and accelerate the pace of the economic development."
He said a bad image has affected the readymade garment (RMG) industry though it is the top earning source of Bangladesh's foreign exchange.
"Bad publicity on social compliance, increased competition and attractiveness of other markets are leading to half filled order books or worse," he added.
He said professionalism is the way to remain competitive in the business-not just costs.
He said the UK is one of the largest investors in Bangladesh with $ 4.0 billion investment and more $ 2.0 billion investment proposals are in the pipeline
"In due course and over the coming months, I hope more and more UK companies will visit Bangladesh to do business and form relationship with their Bangladesh counterparts, but the perception of Bangladesh remains a barrier," Choudhury said.
He said whenever the word Bangladesh is mentioned it conjures up negative images within the business community.
"Just as Bangladesh is lifting itself from the bottom of the corruption list, it can do the same with business and investment, in fact it must," the British HC asserted.
Commenting on the anti-graft drives, he said there seems to be strategic action on everything but trade and investment seen to be suffering from an unforeseen and paradoxical consequences.
"The anti-corruption drive has upset the old ways, the old system of understanding, and this has led to near collapse in business confidence as people sit on the fence to discover how and if the new system will work and sustain," he said.
Choudhury said: "As a result of this and other factors, economic growth this year is predicted to be lower, may be up to 2.0 per cent lower."
The UK government considers Bangladesh's power, ports, ICT, environment, textiles, ceramics and pharmaceuticals as the key sectors for investment.
The FICCI chief welcomed the recent move on floating Bangladesh Business Forum.
"Tax evasion and unethical businesses are still the biggest threat to FDI flow in Bangladesh," he said.
FICCI Vice President Rudolf P Klink offered a vote of thanks.