Poor nations need more investments: Hasina | The Daily Star
12:00 AM, April 22, 2012 / LAST MODIFIED: 12:00 AM, April 22, 2012

Poor nations need more investments: Hasina

PM speaks at Unctad's World Investment Forum

Prime Minister Sheikh Hasina gives the Unctad Investment Promotion Award to a representative of Malta Enterprise at a ceremony in Doha on Friday. Photo: PID

Prime Minister Sheikh Hasina yesterday joined global leaders to urge more investments into poor nations and call for introducing regulatory guidelines to help foster investments.
Hasina urged "international regulations to avoid investment protectionism," and said "stabilisation of capital flow is a challenge."
She attended the third World Investment Forum that opened in Doha.
Hasina also called upon the international business community to think about development while deciding on investments, instead of focusing only on profits.
The forum is being held in conjunction with the 13th ministerial meeting of the United Nations Conference on Trade and Development (Unctad), the first major meeting of the agency since the 2008 global financial crisis.
The Bangladesh's premier also stressed developing a greater consensus on investment to ensure real development and adopt right approaches to face future economic crisis.
“We must develop a greater consensus on investment alongside trade and finance to ensure development and to employ right approaches to face future economic and financial downturn.”
She also spelled out an eight-point observation for global consensus in changing business and investment relations for sustainable investment.
Hasina sought larger public and private investment in agriculture covering food security, research, capacity building and production, thereby providing a scope for effective control on the risks related to price instability in food and agricultural commodities.
She called for removing impediments to infrastructure investment and increasing in such investment in developing countries.
Hasina said controlling the fluctuating demand of non-equity modes of international production and arranging for development should be managed by the developing countries themselves for their own benefit.
Expected GDP growth in some developing countries is often associated with inflow of “hot money” and portfolio investment resulting in exchange rate fluctuation. Hence, stabilisation of capital flow is an important challenge, she said.
Transnational corporations and state owned enterprises are likely to dominate future global investment and will need to be controlled to avoid new protectionist tendencies, Hasina added.
A balanced view of political risks may help global flow of foreign direct investments in developing countries. Developed countries may assure potential investors through appropriate mechanism, she said.
Improved international coordination for regulating to avoid investment protectionism as is being done to control certain forms of subsidies in the framework of the World Trade Organisation.
A balance in labour intensive investment and productivity enhancement investment are essential to spur long term demand, boost global growth, and create job opportunities, Hasina said.
She said challenges for policymakers on deciding FDI and industrial policies are complex while identifying right industries and right policies are critical.
Hasina also said export industries may not necessarily have the greatest impact on employment or value addition. “We need to nurture the selected industries and at the same time focus on emerging industries.”
The prime minister said the Unctad may work with relevant private and public stakeholders, and help on this difficult task.
“New challenges have appeared in the globalised world calling for reforms in the governance of global trade, and in the economic transactions as progress in the Doha Round has been slow and investment around the world, uncertain.”
Hasina said there is an urgent need for low carbon development following the impacts of climate change, and newer services, calling for changes in industrial relations.
Hasina said enhancing productivity and maximising profits are also bringing changes in the investment landscape.
She said businesses activities are constantly adjusting themselves to create opportunities amid new challenges as the states are finding it difficult to balance people's interest and the new trends in businesses.
The prime minister said Bangladesh too is not outside the scenario. “Fortunately, we have managed to maintain sound macroeconomic fundamentals with suitable policy measures.”
She said economic growth has been 6.7 percent last year and is expected to be around 7 percent this year. “Our aim is to raise the growth rate to double digits by 2017 and sustain it till 2021 to become a middle income country.”
Hasina called upon all to invest in Bangladesh for secured profitable returns and help the country in spurring sustainable development, create employment and attain development goals.
“Bangladesh has the most liberal and attractive investment policies in the region.”
She said Bangladesh's strategic location between south and southeast Asia and closeness to China is unique. “Therefore, we've been making all efforts to develop strong regional connectivity with roads, railways and waterways, and become the economic hub of the region.”
Moreover, the prime minister said, Bangladesh's local market of 160 million and the regional market of three billion people is also growing up steadily in terms of purchasing power and consumption.
“In addition our business sector boasts of innovative entrepreneurs, efficient managers and skilled labour at competitive wages.”
She noted that assessing Bangladesh's present policies and potential, Goldman Sachs has ranked it as one of the 11 emerging economies after BRIC; JP Morgan has included it in the list of 'Frontier Five'; Standard and Poor's has rated it a BB; and Moody's as Ba3 for successive years.
Hasina said Bangladesh's development deficit is due to its inadequate infrastructure and energy. “We have, therefore, increased public sector investment in infrastructure, energy. Private sector investment is also increasing.”
She said her government is encouraging public-private partnership in the construction of highways, multi-purpose bridges, power stations, airports, and seaports.
“Though investment is increasing, it is unable to keep pace with the demand,” she told the conference.
The prime minister also said the government has adopted and is implementing FDI policies offering most friendly fiscal and financial incentives with stable regulatory framework.
“Investors are invited to invest in infrastructures, energy, transport connectivity, textiles, shipbuilding, pharmaceuticals, ceramics, leather products, light engineering, telecommunications and ICT,” she said.
Hasina said investors can reap the benefit of duty free and quota free market access to major economies that Bangladesh enjoys. “Nine special economic zones are under the process of completion,” she added.
Unctad Secretary General Dr Supachai Panitchpakdi criticised the G20 nations for their "restrictive policies" with regard to trade and investment, saying this amounted to a key challenge to the outflow of FDI.
"Another challenge is that we need investments to be responsible ... we need investments in poor countries, in food," he said.
According to Unctad's latest report last week, global FDI outflows rose by 16 percent in 2011 to an estimated $1.66 trillion (1.26 trillion euros) to surpass the pre-crisis level, but still remain 25 percent below its peak reached in 2007.
However, that growth has failed to translate into expanding productive capacity, as it was largely used for cross-border acquisitions and to increase cash reserves kept in foreign affiliates.
Prospects for FDI outflows in 2012 are still improving, but they remain guarded due to the fragility of the global economic recovery, said the report.
Panitchpakdi said the reason for the failure of investments to fully recover is because the "capital formation has not taken place," and called for a "collective global governance for the investments to prosper."
Tunisian President Moncef Marzouki said the structure of world investments and its distribution has not witnessed a fundamental change after the global financial crisis.
"The main driving force for investment flows remain the country's size and its resources, so poor nations are ignored," said Marzouki, who called for more investments in Africa, which now attracts just 4.4 percent of world outflows.
Qatar's Deputy Prime Minister and Minister of Cabinet Affairs Ahmed bin Abdullah Al Mahmoud also spoke.

(With details from UNB and AFP)

Stay updated on the go with The Daily Star News App. Click here to download it for your device.

Grameenphone and Robi:
Type START <space> BR and send SMS it to 2222

Type START <space> BR and send SMS it to 2225

Leave your comments

Top News

Top News