UNCTAD report on Bangladesh

FDI down 4.74pc in 2014

Gross inflow of foreign direct investment shows 28.75pc rise

Actual inflow of Foreign Direct Investment (FDI) in 2014, in Bangladesh, was US$ 1,526.70 million, according to a report of the United Nations Conference on Trade and Development (UNCTAD). The amount is 4.74 per cent lower than the US$ 1,599.16 million recorded in 2013.
The FDI inflow comprised fresh equity, amounting to US$ 280.31 million, while US$ 988.79 million came from reinvestment earnings.
The Board of Investment (BoI) released the report in its auditorium at Dilkusha, yesterday.
However, the BoI said that, in terms of gross FDI inflow, the amount stands at US$ 2,058.98 million, which is 28.75 per cent higher than US$ 1,599.16 million recorded in 2013.
Professor of economic department of Jahangirnagar University, Dr M Ismail Hossain, presented the UNCTAD World Investment Report (WIR), 2015.
Chaired by executive chairman of BOI, Dr SA Samad, adviser to the Prime Minister for power, energy and mineral resources affairs Dr Tawfiq-E-Elahi Chowdhury, chairman of Public account Committee, Dr Mohiuddin Khan Alamgir MP, and deputy governor of Bangladesh Bank, Naznin Sultana, among others, spoke during the programme.
Tawfiq-e-Elahi differed with the UNCTAD report saying, “There is inconsistency in the report, as UNCTAD reflects only the net investment of the FDI. They did not incorporate the entire data on FDI in the report.”
He said that Chevron imported capital machinery worth of US$ 500 million in 2014, which was not incorporated in the report. He also said the machinery import cost of the foreign companies have to be incorporated in the FDI account, in order to reflect the total FDI.
He alleged that UNCTAD always reflects a low FDI to Bangladesh. The Prime Minister’s adviser said, at this moment, an investment-friendly environment prevails in Bangladesh.
“The law and order situation in Bangladesh is favourable for investment,” he said.
However, he alleged that the BNP-led 20 Party Alliance hampered the normal flow economic activities in the first three months, by creating anarchy.
Mohiuddin Khan said domestic investment should be encouraged to save the local industries sector.
He also said the local market in Bangladesh has expanded. For this reason, foreign investors are interested to invest here.
The UNCTAD report said FDI inflow to South Asia rose to US$ 41 billion in 2014, primarily because of India's good performance. The FDI inflow into the neighbouring country surged 22 per cent to about US$ 34 billion. FDI inflow to India is likely to maintain an upward trend in 2015, as economic recovery gains ground. In terms of the sectoral composition of FDI inflow, manufacturing is likely to gain strength, as policy efforts to revitalise the industrial sector like the "Make in India" initiative launched in mid-2014, are sustained.
The report showed that FDI inflows to Pakistan increased by 31 per cent to US$ 1.7 billion, as a result of rising Chinese FDI inflow in services. Furthermore, the country will benefit significantly from the China-Pakistan Industrial Corridor and associated Chinese investment in infrastructure and manufacturing, in the overall context of implementing the 'One Belt, One Road' strategy.
According to agreements signed between the two governments in April 2015, Chinese companies will invest about US$ 45.6 billion (US$ 33.8 billion in electricity and US$ 11.8 billion in transport infrastructure) in Pakistan, over the next few years.
In Sri Lanka, FDI inflow from China also rose (China has become the largest source of FDI to the country in recent years). For example, a joint venture between two local companies and China Merchants Holdings (International) Company has invested US$ 500 million in Colombo International Container Terminals, the largest foreign investment project in Sri Lanka. After two years of construction, the port became operational in August 2014. A China-Sri Lanka free trade agreement will be signed in June 2015. Moreover, if implementation of the China-led 21st Century Maritime Silk Route Economic Belt gains ground, an increasing amount of Chinese investment, particularly in large infrastructure projects, will flow to Sri Lanka.
In South Asia's manufacturing sector, the report stated that FDI success stories have emerged at all levels, with the automotive industry in India showing how large-scale FDI inflow can reshape the trajectory of industrial progress in low-income countries.
The automotive industry is a key part of the Indian economy, and has been identified as one of the key industries in which India has the potential of becoming a world leader. According to data from the Indian government, accumulated FDI inflow to the automotive industry, from April 2000 to November 2014, amounted to US$ 11.4 billion. The country accounted for the majority of greenfield investment projects announced by global automakers and first-tier parts suppliers in South Asia, during 2013-2014, including 12 projects above US$ 100 million.
Inward FDI has led to the emergence of a number of industrial clusters in India, including those in the national capital region (Delhi-Gurgaon-Faridabad) in the north, Maharashtra (Mumbai-Nasik-Aurangabad) in the west, and Tamil Nadu (Chennai-Bangalore-Hosur) in the south.

UNCTAD report on Bangladesh

FDI down 4.74pc in 2014

Gross inflow of foreign direct investment shows 28.75pc rise

Actual inflow of Foreign Direct Investment (FDI) in 2014, in Bangladesh, was US$ 1,526.70 million, according to a report of the United Nations Conference on Trade and Development (UNCTAD). The amount is 4.74 per cent lower than the US$ 1,599.16 million recorded in 2013. The FDI inflow comprised fresh equity, amounting to US$ 280.31 million, while US$ 988.79 million came from reinvestment earnings. The Board of Investment (BoI) released the report in its auditorium at Dilkusha, yesterday. However, the BoI said that, in terms of gross FDI inflow, the amount stands at US$ 2,058.98 million, which is 28.75 per cent higher than US$ 1,599.16 million recorded in 2013. Professor of economic department of Jahangirnagar University, Dr M Ismail Hossain, presented the UNCTAD World Investment Report (WIR), 2015. Chaired by executive chairman of BOI, Dr SA Samad, adviser to the Prime Minister for power, energy and mineral resources affairs Dr Tawfiq-E-Elahi Chowdhury, chairman of Public account Committee, Dr Mohiuddin Khan Alamgir MP, and deputy governor of Bangladesh Bank, Naznin Sultana, among others, spoke during the programme. Tawfiq-e-Elahi differed with the UNCTAD report saying, There is inconsistency in the report, as UNCTAD reflects only the net investment of the FDI. They did not incorporate the entire data on FDI in the report. He said that Chevron imported capital machinery worth of US$ 500 million in 2014, which was not incorporated in the report. He also said the machinery import cost of the foreign companies have to be incorporated in the FDI account, in order to reflect the total FDI. He alleged that UNCTAD always reflects a low FDI to Bangladesh. The Prime Ministers adviser said, at this moment, an investment-friendly environment prevails in Bangladesh. The law and order situation in Bangladesh is favourable for investment, he said. However, he alleged that the BNP-led 20 Party Alliance hampered the normal flow economic activities in the first three months, by creating anarchy. Mohiuddin Khan said domestic investment should be encouraged to save the local industries sector. He also said the local market in Bangladesh has expanded. For this reason, foreign investors are interested to invest here. The UNCTAD report said FDI inflow to South Asia rose to US$ 41 billion in 2014, primarily because of Indias good performance. The FDI inflow into the neighbouring country surged 22 per cent to about US$ 34 billion. FDI inflow to India is likely to maintain an upward trend in 2015, as economic recovery gains ground. In terms of the sectoral composition of FDI inflow, manufacturing is likely to gain strength, as policy efforts to revitalise the industrial sector like the Make in India initiative launched in mid-2014, are sustained. The report showed that FDI inflows to Pakistan increased by 31 per cent to US$ 1.7 billion, as a result of rising Chinese FDI inflow in services. Furthermore, the country will benefit significantly from the China-Pakistan Industrial Corridor and associated Chinese investment in infrastructure and manufacturing, in the overall context of implementing the One Belt, One Road strategy. According to agreements signed between the two governments in April 2015, Chinese companies will invest about US$ 45.6 billion (US$ 33.8 billion in electricity and US$ 11.8 billion in transport infrastructure) in Pakistan, over the next few years. In Sri Lanka, FDI inflow from China also rose (China has become the largest source of FDI to the country in recent years). For example, a joint venture between two local companies and China Merchants Holdings (International) Company has invested US$ 500 million in Colombo International Container Terminals, the largest foreign investment project in Sri Lanka. After two years of construction, the port became operational in August 2014. A China-Sri Lanka free trade agreement will be signed in June 2015. Moreover, if implementation of the China-led 21st Century Maritime Silk Route Economic Belt gains ground, an increasing amount of Chinese investment, particularly in large infrastructure projects, will flow to Sri Lanka. In South Asias manufacturing sector, the report stated that FDI success stories have emerged at all levels, with the automotive industry in India showing how large-scale FDI inflow can reshape the trajectory of industrial progress in low-income countries. The automotive industry is a key part of the Indian economy, and has been identified as one of the key industries in which India has the potential of becoming a world leader. According to data from the Indian government, accumulated FDI inflow to the automotive industry, from April 2000 to November 2014, amounted to US$ 11.4 billion. The country accounted for the majority of greenfield investment projects announced by global automakers and first-tier parts suppliers in South Asia, during 2013-2014, including 12 projects above US$ 100 million. Inward FDI has led to the emergence of a number of industrial clusters in India, including those in the national capital region (Delhi-Gurgaon-Faridabad) in the north, Maharashtra (Mumbai-Nasik-Aurangabad) in the west, and Tamil Nadu (Chennai-Bangalore-Hosur) in the south.