According to Goldman Sachs, the next 11 emerging economies in the world includes Bangladesh along with Egypt, Indonesia, Iran, Mexico, Nigeria, Philippines, Turkey, South Korea, Pakistan and Vietnam.
Foreign Direct Investment (FDI) is very vital for economy of developing countries like Bangladesh as it accelerates Gross Domestic Product (GDP), domestic investment and export followed by overall economic growth. Bangladesh has been a lucrative place for foreign investment in the recent years after the country has reached political stability, which was a major concern for foreign investors for years, under the current government.
In a way re-endorsing Goldman Sachs next 11 economies statement regarding Bangladesh, according to a recent report by United Nations Conference on Trade and Development (UNCTAD), in 2015, Bangladesh has received USD 2235 million as Foreign Direct Investment (FDI) making Bangladesh the second largest FDI receiver in the southeast Asia. This is the highest amount of FDI received in a year in the history of Bangladesh. Though the other countries in this reason have experienced a downfall in the FDI in 2015, except India, the FDI has increased by 44% in Bangladesh in 2015. In practice, the foreign investment is even higher as a major part of the foreign loan and donations has been invested in various sectors.
The economist of the country is of the view that the reason behind the rapid growth of the FDI in the country is the outcome of the political stability and investment friendly environment. Higher profit, which might be as high as 14% to 15 % depending on the type business, is another crucial reason which attracted more FDI to Bangladesh than the neighboring countries as indicated by the Executive Chairman of Board of Investment (BOI).
The UNCTAD report indicates that majority of the FDI has been made in the power, energy and readymade garments sector which amounts to around USD 1000 million.
FM Associates as a responsible leading full service law firm in Bangladesh, has also witness the increase in the FDI in Bangladesh in the recent years as several of its foreign clients, multinational companies, have made million dollar investment in various sectors, such as energy, infrastructure, readymade garments, aviation, beverage, shipping, garments, etc.
It is stipulated that the FDI shall increase further in the upcoming years as the government is very keen at implementing laws which are investment friendly. The government has uplifted several strict laws on foreign investment of various governmental organizations such as a recent SRO passed by the Bangladesh Security Exchange Commission according to which it is no longer a mandatory requirement for the foreign owned companies or joint ventures to enlist them as public limited company after raising their authorized capital beyond a certain amount. The government has made investment related treaty with 31 foreign countries to enhance the growth of FDI in Bangladesh.
The critics are of the view that in regards to FDI the government shall make more friendly regulations, simplify regulatory practices, give investment incentives and remove inefficient bureaucratic procedures. FM Associates, being a responsible law firm in the quest of being the best law firm in Bangladesh, is working with several groups in this regard as well to eradicate barriers to investments and has organized several seminars in this regard.