Investors worry about instability
Foreign companies that are willing to invest in Bangladesh want security, not political violence or electoral instability, said US Ambassador to Bangladesh Peter Haas yesterday.
Smart foreign companies want to see certain qualities -- developed transport system, consistent access to power and water, and a well-trained workforce -- before investing in a country.
"A company also wants certainty. A company wants security. Political violence and electoral instability scare them," Haas said.
He made the comments while addressing the annual general meeting 2021 of the International Business Forum of Bangladesh at a city hotel.
The US is the largest export destination for Bangladesh, with the annual export being $11.41 billion. The foreign direct investment (FDI) is also the biggest, about $6 billion.
In recent months, Haas repeatedly spoke about participatory and fair elections in Bangladesh.
The US is focused on several key objectives that includes a peaceful and stable Bangladesh which is committed to democracy, transparency, pluralism, tolerance, good governance, and respect for human rights.
It also wants a socially and environmentally resilient Bangladesh.
Many things attract foreign investors. Bangladesh has been among the fastest growing economies in the world over the past decade and has great macroeconomic stability even in challenging times, he said.
So far, the macroeconomic situation seems manageable; the country has a huge and increasingly middle-class population, and above all, it is a huge market with its 165 million people, including a willing workforce, he added.
He said it is pleasing that Bangladesh has committed to telling its stories to international investors and continues to improve its physical, legal, and financial structures to improve the investment climate here.
However, at the same time, Haas said, a company wants a policy framework that is understood, and laws that are consistently enforced. It wants to know that if a dispute arises it has access to courts that can quickly and fairly settle it.
"A company does not want to be taxed more rigorously or investigated more thoroughly than its local competitors. And a company wants to know it can repatriate its profits easily and without delay."
Peter Haas has asked if Bangladesh can assure investors that the cancerous effects of corruption are less prevalent here than in other markets and if it can say it fully understands the impacts of proposed regulations on business and that it actively seeks stakeholder input before putting them in place.
"For example, does the Bangladesh Telecommunications Regulatory Commission understand how its proposed rules governing data privacy and online content will force digital businesses to reconsider investing in Bangladesh?"
He also asked if Bangladesh can say it has an adequate legal framework within which businesses can operate when it takes years to schedule a hearing.
These are the questions that American and international companies will ask themselves before deciding to do business in Bangladesh, he said.
"Luckily, Bangladesh has committed to addressing these issues."
He said the US stands ready to assist Bangladesh in creating a business climate that is as welcoming as possible to foreign investments.
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