Growth sectors and Foreign Direct Investment

Rapid growth may be achieved by following an aggressive policy of expansion of profitable manufacturing facilities and widening the marketing networks

Growth, development and employment are co-related and have a strong reflection and relation with economy. A small country like Bangladesh which has dense population and a big portion of them are unemployed or under-employed is the matter of thought in this direction. Growth sectors or rising sectors which are intensively labour-oriented can solve unemployment or under-employment problems in the country partially. Growth companies whose assets, sales turnover and profits are growing rapidly are called growth companies. Rapid growth may be achieved by following an aggressive policy of expansion of profitable manufacturing facilities and widening the marketing networks, or through diversification into profitable line of activity. These companies are usually led by a very high growth-oriented entrepreneurial type of management in other words as “strong, farsighted and quality management.”

They have diversified subsidiary, export potentiality and investment capacities abroad as recently Square Pharmaceutical Company, a growth company of Bangladesh is going to establish subsidiary company in Kenya, Nairobi. They have strong fundamentals with managerial excellence, leading position in the market, market capture capacity, excellent products and services, substantial profits and cash flow, innovation capacities, establish strong market power, strong distribution channel, highly advertised brands, proprietary products and services which will create employment, consistent growth in sales, profits, and fixed assets, highly integrity and business ethics, ability to produce high profit reducing costs, internal and external economies, reserve and plough back to re-invest and strong financial footing. They give a high amount of taxes to the Government exchequer. They have capacities to develop new specialized products and market dominance by research methodology obtaining operative cost advantages through better factor costs, operational efficiencies.

They enjoy full advantage of tax incentives available for growth through expansion, modernization, diversification and mergers and acquisition in the policy of the Government. They are conducted, directed and managed by a group of qualified, skilled, and farsighted intelligent persons. So, there are more possibilities and opportunities for employment in the country locally in the growth sectors. In that field, if we call Foreign Direct Investment (FDI) by giving different incentives like tax rebate, outflow of capital, profits to the foreigners in their own country, it will hamper further expansion, diversification of the companies lessening employment in our native land. They will outflow their profits, reserve, capital in their own countries. The foreigners will choose to employ their indigenous workforce, capital machinery and choose other product-related inputs from their countries. It will hamper our employment opportunities.  Bangladesh is on the take of position of urbanization and industrialization. So, our steel, cement sectors, medicine, leather, ICT, agro-based projects or industries, etc. may be called growth sectors because of their great demand in present and in near future.

Foreign Direct Investment (FDI) may be encouraged to the heavy capital-intensive industries like deep sea-port, railway, shipbuilding, gas and oil exploration, jute industry, herbal medicine, blue economy, international airport, hi-techno products in Special Economic Zone, naval-military equipment, space and aviation, floating sea-port like China, nuke power plants like our Rooppur Nuclear Power Plant, etc.

China, starting from 1993, maintained to be a developing country using the second largest amount of foreign investment for nine consecutive years, next only to the United States. They made all relevant rules maintaining their own interests and benefits. They made a comparatively complete set of laws, statutes, regulations and measures as regards the establishment, operation, termination and liquidation of foreign-invested businesses. In the past years since reform and opening-up, they took the policies to allow establishing foreign-invested enterprises that are beneficial to the development of China’s national economy. The state encourages foreign business people to launch export-oriented or technically advanced foreign-invested enterprises.A data has been given below about Foreign Direct Investment (FDI) inflow trends in our country.

Data shows that every year Foreign Direct Investment (FDI) is increasing in our country by our consecutive development in the last decade.

So, we are recommending for more growth industries in the country for more employment reducing significant unemployment educated youths. In this time, growth companies/industries need not too much attract Foreign Direct Investment (FDI) in our country.  

If so, it will stop more capital and income outflow to the foreign countries helping more contribution to our GDP and national income creating employment opportunities. We should research, should be thoughtful, prudent and economical in attracting FDI and its uses in production, employment and in our economy.

The writer is an Additional Land Acquisition Officer, in DC (Deputy Commissioner) Office, Dhaka. E-mail: [email protected]

 

Growth sectors and Foreign Direct Investment

Rapid growth may be achieved by following an aggressive policy of expansion of profitable manufacturing facilities and widening the marketing networks

Growth, development and employment are co-related and have a strong reflection and relation with economy. A small country like Bangladesh which has dense population and a big portion of them are unemployed or under-employed is the matter of thought in this direction. Growth sectors or rising sectors which are intensively labour-oriented can solve unemployment or under-employment problems in the country partially. Growth companies whose assets, sales turnover and profits are growing rapidly are called growth companies. Rapid growth may be achieved by following an aggressive policy of expansion of profitable manufacturing facilities and widening the marketing networks, or through diversification into profitable line of activity. These companies are usually led by a very high growth-oriented entrepreneurial type of management in other words as strong, farsighted and quality management. They have diversified subsidiary, export potentiality and investment capacities abroad as recently Square Pharmaceutical Company, a growth company of Bangladesh is going to establish subsidiary company in Kenya, Nairobi. They have strong fundamentals with managerial excellence, leading position in the market, market capture capacity, excellent products and services, substantial profits and cash flow, innovation capacities, establish strong market power, strong distribution channel, highly advertised brands, proprietary products and services which will create employment, consistent growth in sales, profits, and fixed assets, highly integrity and business ethics, ability to produce high profit reducing costs, internal and external economies, reserve and plough back to re-invest and strong financial footing. They give a high amount of taxes to the Government exchequer. They have capacities to develop new specialized products and market dominance by research methodology obtaining operative cost advantages through better factor costs, operational efficiencies. They enjoy full advantage of tax incentives available for growth through expansion, modernization, diversification and mergers and acquisition in the policy of the Government. They are conducted, directed and managed by a group of qualified, skilled, and farsighted intelligent persons. So, there are more possibilities and opportunities for employment in the country locally in the growth sectors. In that field, if we call Foreign Direct Investment (FDI) by giving different incentives like tax rebate, outflow of capital, profits to the foreigners in their own country, it will hamper further expansion, diversification of the companies lessening employment in our native land. They will outflow their profits, reserve, capital in their own countries. The foreigners will choose to employ their indigenous workforce, capital machinery and choose other product-related inputs from their countries. It will hamper our employment opportunities. Bangladesh is on the take of position of urbanization and industrialization. So, our steel, cement sectors, medicine, leather, ICT, agro-based projects or industries, etc. may be called growth sectors because of their great demand in present and in near future. Foreign Direct Investment (FDI) may be encouraged to the heavy capital-intensive industries like deep sea-port, railway, shipbuilding, gas and oil exploration, jute industry, herbal medicine, blue economy, international airport, hi-techno products in Special Economic Zone, naval-military equipment, space and aviation, floating sea-port like China, nuke power plants like our Rooppur Nuclear Power Plant, etc. China, starting from 1993, maintained to be a developing country using the second largest amount of foreign investment for nine consecutive years, next only to the United States. They made all relevant rules maintaining their own interests and benefits. They made a comparatively complete set of laws, statutes, regulations and measures as regards the establishment, operation, termination and liquidation of foreign-invested businesses. In the past years since reform and opening-up, they took the policies to allow establishing foreign-invested enterprises that are beneficial to the development of Chinas national economy. The state encourages foreign business people to launch export-oriented or technically advanced foreign-invested enterprises.A data has been given below about Foreign Direct Investment (FDI) inflow trends in our country. Data shows that every year Foreign Direct Investment (FDI) is increasing in our country by our consecutive development in the last decade. So, we are recommending for more growth industries in the country for more employment reducing significant unemployment educated youths. In this time, growth companies/industries need not too much attract Foreign Direct Investment (FDI) in our country. If so, it will stop more capital and income outflow to the foreign countries helping more contribution to our GDP and national income creating employment opportunities. We should research, should be thoughtful, prudent and economical in attracting FDI and its uses in production, employment and in our economy. The writer is an Additional Land Acquisition Officer, in DC (Deputy Commissioner) Office, Dhaka. E-mail: [email protected]