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Security and transparency are the most important factors to attract foreign investment. At the same time, corruption is an obstacle the country should solve to encourage foreign investors to invest here, said Achim Tröster, the German ambassador to Bangladesh.
“I hear from my contacts that this [corruption] is at least an obstacle and a problem that should be solved if Bangladesh wants to attract more foreign investment,” Tröster told journalists yesterday.
He was addressing a press conference organised at his residence to launch the German Business Council (GBC), a platform of German private companies operating in Bangladesh.
Tröster cited World Bank reports that show foreign direct investment (FDI) in Bangladesh is extremely low compared to other countries in the region.
Net FDI was 0.4 per cent of Bangladesh’s gross domestic product (GDP) in 2020. In the case of India, the FDI as a percentage of GDP was 2.4 per cent. Sri Lanka and Pakistan also had a higher net FDI to GDP ratio compared to Bangladesh that same year, according to World Bank data.
Bangladesh received $1.96 billion in net foreign investment in July-January of fiscal year 2021-22, which was 35 per cent higher year-on-year, shows Bangladesh Bank data.
Tröster said countries that want FDI have to be competitive to attract investors.
At the event, GBC Chairman Md Sazzadul Hassan said they will work to encourage investment and trade with Bangladesh and work to facilitate a suitable business environment for German companies.
The GBC also aims to help German companies that want to come to Bangladesh and it will raise voices to the concerns of German businesses operating in Bangladesh too.
Hassan then said there are plenty of opportunities to diversify exports from Bangladesh to Germany while also increasing imports from the biggest economy in Europe.
He said some leading German companies have shown interest to invest in Bangladesh.
Currently, 15 GBC members are operating in the energy and power, chemical, agriculture, and textile sectors of Bangladesh. Some of these firms have been working in the country for decades, even before it gained independence.
Formally registered as a trust in December 2019, the GBC’s launch was delayed by the pandemic. The platform is managed by five boards of trustees representing renowned German business organisations.
Tröster said a genuine representation of German business was previously missing in Bangladesh.
“The GBC will be a platform for purely German business interests in the country,” he said, expecting that the GBC would play an advisory role for German enterprises as well as for the German embassy.
Tawfiq Ali, managing trustee of the GBC, said Bangladesh offers a lot of positive things.
“Every company that tries to grow should understand the growth momentum of this country. Bangladesh could be a good destination for any company that wants to grow, said Ali, also chief representative of Commerzbank in Bangladesh.
“The government of Bangladesh also needs to improve the business environment,” he added.
(TDS)
