Restore investors' confidence in the economy
Friday, 5 June 2009
Syed Fattahul Alim
A newspaper report says the Board of Investment (BoI), the government agency to promote investment in the country looks like an abandoned organisation as the new government has not been able to pay necessary attention to this office. It is further learnt that the organisation also suffers from serious shortage of manpower to run it properly. Apart from manpower constraints, the BoI, which was created two decades back for the sole purpose of increasing investment in the economy by local as well as foreign investors, lacks direction as it is yet to have any organogram to run it effectively. That the incumbent government has not been able to pay due attention to this organisation even five months after it has been sworn into office has among other reasons the fact that the prevailing condition of recession across the globe is not conducive for the investors to put in their precious money in any enterprise and that, too, in a least developed country in the Third world plagued by bureaucratic hurdles, corruption, natural calamities and various other factors to dampen the very spirit of investment. Not only that. At the moment, the country is also experiencing another kind of uncertainty arising from severe shortage of electricity and fast dwindling reserves of fuel from its gas fields. All these factors might have militated against the BoI to draw necessary attention from the new political government now in office.
To the different points indicated in the foregoing as the potential reasons which are in all probability vitiating the overall investment climate of the country negatively, one may add yet another point that has recently become a big source of headache for the government. Even the foreign diplomats have made written complaints to the government against this problem. It is the rising number of criminal incidents in the capital city as elsewhere in the country.
True, crime is no stranger to this city, neither is it so in other parts of the country. Unfortunately, the latest crop of criminals appears to have lost their earlier restraint on attacking foreigners within the diplomatic enclave in the city. The law enforcers, too, were extra-careful about controlling crime with iron fist in the diplomatic zones, because it has to do with what the politicians, the businesspeople and the donor community are so sensitive about-the 'image of the country'. The written complaint to the government from the dean of the diplomatic community detailing incidents of mugging of foreigners and staff of the foreign missions is undoubtedly a serious issue. That is more so with one concerned with the overall investment climate in the country, for foreign investors in particular develop their preliminary notion about a country wherein they might be considering investing from their diplomatic missions working there. So, if the foreign diplomats are in fear of their physical security, one may easily imagine what kind of signal it is apt to send to the potential foreign investors.
The above, in other words, serves to elongate the list of the probable reasons having the potential to prejudice the country's investment climate by yet another point, that is, crime.
So, it is not only the BoI's lacklustre status, or the raging recession or the government's lack of keenness that are to blame. Crime is also gradually becoming another contributing factor to dampen the general climate of investment in the country.
As it is reflective of the government's ability to maintain law and order in the eyes of the foreign diplomats, it is hoped that the administration would swing into action to at least to ensure security of the foreign diplomats within the protected zone.
The situation does not speak well for the overall investment climate prevailing in the country. A least developed country like Bangladesh smarting from overpopulation, poverty, natural calamities and the hangover of political uncertainties and so on is left with few options, but to develop the economic situation of the people. But improving the economic situation implies more investment and job creation for the rising number of unemployed. The government, especially an elected one, of a country plagued with so many problems cannot simply afford to forget for a moment that the solution to solving its gruelling problems lies in drawing more investment in the economy.
The BoI being the government body to promote investment in the country should not under any circumstances fail to lose its importance to the government. Similarly, no situation should be able to distract the government's attention from the all important issue of wooing as many investors as possible into the economy.
The ongoing recession has markedly dulled the investment climate everywhere, let alone in Bangladesh. The investors as a result have become shy of investment. Evidently, Bangladesh, too, is a victim of this situation affecting the global investment climate.
But should it be any reason for the government to lower its level of alertness about such a vital concern? Not in the least, for that would be suicidal for the economy.
Though the general atmosphere of investment is lacking in spirit that should rather furnish stronger reason for all concerned to be all out to leave no stone unturned and open as many windows as possible towards maintaining the flow of investment in the economy at an acceptable level.
Reports have it that during the first four months of the incumbent government, the volume of investment in the economy has been to the tune of US$398 million. This amount is less than one third the volume of investment during the same months of the previous year. But the recession was raging with no less intensity than in the year before. Then why has the flow of investment reached a trough within such a short time and that, too, at a time when an elected government is in office?
The government should therefore waste no time to remove the factors vitiating the investment climate of the country. It should concentrate more on combating the rising level of crime, restructuring the BoI and opening every possible window to ensure enhanced flow of investment in the economy.
A newspaper report says the Board of Investment (BoI), the government agency to promote investment in the country looks like an abandoned organisation as the new government has not been able to pay necessary attention to this office. It is further learnt that the organisation also suffers from serious shortage of manpower to run it properly. Apart from manpower constraints, the BoI, which was created two decades back for the sole purpose of increasing investment in the economy by local as well as foreign investors, lacks direction as it is yet to have any organogram to run it effectively. That the incumbent government has not been able to pay due attention to this organisation even five months after it has been sworn into office has among other reasons the fact that the prevailing condition of recession across the globe is not conducive for the investors to put in their precious money in any enterprise and that, too, in a least developed country in the Third world plagued by bureaucratic hurdles, corruption, natural calamities and various other factors to dampen the very spirit of investment. Not only that. At the moment, the country is also experiencing another kind of uncertainty arising from severe shortage of electricity and fast dwindling reserves of fuel from its gas fields. All these factors might have militated against the BoI to draw necessary attention from the new political government now in office.
To the different points indicated in the foregoing as the potential reasons which are in all probability vitiating the overall investment climate of the country negatively, one may add yet another point that has recently become a big source of headache for the government. Even the foreign diplomats have made written complaints to the government against this problem. It is the rising number of criminal incidents in the capital city as elsewhere in the country.
True, crime is no stranger to this city, neither is it so in other parts of the country. Unfortunately, the latest crop of criminals appears to have lost their earlier restraint on attacking foreigners within the diplomatic enclave in the city. The law enforcers, too, were extra-careful about controlling crime with iron fist in the diplomatic zones, because it has to do with what the politicians, the businesspeople and the donor community are so sensitive about-the 'image of the country'. The written complaint to the government from the dean of the diplomatic community detailing incidents of mugging of foreigners and staff of the foreign missions is undoubtedly a serious issue. That is more so with one concerned with the overall investment climate in the country, for foreign investors in particular develop their preliminary notion about a country wherein they might be considering investing from their diplomatic missions working there. So, if the foreign diplomats are in fear of their physical security, one may easily imagine what kind of signal it is apt to send to the potential foreign investors.
The above, in other words, serves to elongate the list of the probable reasons having the potential to prejudice the country's investment climate by yet another point, that is, crime.
So, it is not only the BoI's lacklustre status, or the raging recession or the government's lack of keenness that are to blame. Crime is also gradually becoming another contributing factor to dampen the general climate of investment in the country.
As it is reflective of the government's ability to maintain law and order in the eyes of the foreign diplomats, it is hoped that the administration would swing into action to at least to ensure security of the foreign diplomats within the protected zone.
The situation does not speak well for the overall investment climate prevailing in the country. A least developed country like Bangladesh smarting from overpopulation, poverty, natural calamities and the hangover of political uncertainties and so on is left with few options, but to develop the economic situation of the people. But improving the economic situation implies more investment and job creation for the rising number of unemployed. The government, especially an elected one, of a country plagued with so many problems cannot simply afford to forget for a moment that the solution to solving its gruelling problems lies in drawing more investment in the economy.
The BoI being the government body to promote investment in the country should not under any circumstances fail to lose its importance to the government. Similarly, no situation should be able to distract the government's attention from the all important issue of wooing as many investors as possible into the economy.
The ongoing recession has markedly dulled the investment climate everywhere, let alone in Bangladesh. The investors as a result have become shy of investment. Evidently, Bangladesh, too, is a victim of this situation affecting the global investment climate.
But should it be any reason for the government to lower its level of alertness about such a vital concern? Not in the least, for that would be suicidal for the economy.
Though the general atmosphere of investment is lacking in spirit that should rather furnish stronger reason for all concerned to be all out to leave no stone unturned and open as many windows as possible towards maintaining the flow of investment in the economy at an acceptable level.
Reports have it that during the first four months of the incumbent government, the volume of investment in the economy has been to the tune of US$398 million. This amount is less than one third the volume of investment during the same months of the previous year. But the recession was raging with no less intensity than in the year before. Then why has the flow of investment reached a trough within such a short time and that, too, at a time when an elected government is in office?
The government should therefore waste no time to remove the factors vitiating the investment climate of the country. It should concentrate more on combating the rising level of crime, restructuring the BoI and opening every possible window to ensure enhanced flow of investment in the economy.