BoI chief upbeat on FDI flow

President of Foreign Investors' Chamber of Commerce and Industry (Ficci) Waliur Rahman Bhuiyan (2nd from right) speaks at a programme in Dhaka yesterday. Executive Chairman of the Board of Investment Dr SA Samad (2nd from left) is also seen in the monthly luncheon meeting of the Ficci. Photo: FICCI Star Business Report

The state-run investment promotional body chief is upbeat on foreign direct investment flow to Bangladesh at an amount of at least $5 billion a year, despite the present declining trend.

i"It is our target to receive a minimum of $ 3 billion and a maximum of $5 billion in oversees investment per year," SA Samad told a meeting of foreign entrepreneurs in Dhaka yesterday.

Held at Radisson Water Garden Hotel, the monthly luncheon was organised by Foreign Investors' Chamber of Commerce and Industry (Ficci).

The Board of Investment (BoI) executive chairman also drew the entrepreneurs' attention to Bangladesh's improving investment climate.

Pointing his finger at the present recovery from global recession by major economies, Samad hoped that the country would come out of the 2009 FDI trend.

The 2008 FDI was $1billion.

"We expect foreign investors to shift some of their investments to Bangladesh, considering the lesser impacts of global recession in the country," the BoI chief said.

Referring to Ficci President Waliur Rahman Bhuiyan who suggested a double-digit growth for the alleviation of poverty, Samad said, "It is not easy. But we can be optimistic to achieve that if private sector investment gains momentum."

Sri Lanka did not lose FDI despite having a civil war for the last 30 years, he pointed out.

He assured investors of government policy support.

Samad admitted to some hurdles in new investment, such as utilities. "A democratic government is more investment-friendly. We have to be more pragmatic."

FDI is expected to grow steadily from low base but could pick up significantly if energy situation improves, said the Ficci president.

"Foreign investors have demonstrated widespread interest in Bangladesh after the new democratic government took over," Bhuiyan said.

Bangladesh's FDI registration in the January-July period stood at $ 573.60 million.

Although the country's investment climate compares favourably with most other South Asian countries, particularly in terms of competitive labour costs and flexible labour laws, the cost of doing business in Bangladesh is perceived to be high, said Bhuiyan.

"The high cost is a reflection of corruption, a weak law and order situation, inadequate infrastructure and services, gaps in the skills base and distressed financial markets," the Ficci president said.

"If the existing foreign investors are happy, then only will prospective investors be encouraged to invest. We feel BoI can play a significant role in this regard.”