According to the Bangladesh Bank’s latest report, direct foreign investment (FDI) in Bangladesh declined 8.8% during the fiscal year 2023-24. Net FDI amounted to $1.47 billion, a $142 million decrease from $1.61 billion in FY 2022-23.
The report reveals that Bangladesh’s textile industry led FDI inflows, with other key sectors—banking, pharmaceuticals, and energy—also drawing significant attention from foreign investors. However, economists and bankers point to various challenges that have impacted the overall investment climate.
Naser Ezaz Bijoy, CEO of Standard Chartered Bank, cited political and economic factors influencing investor confidence. He explained that political uncertainties surrounding the 12th general election have made foreign investors cautious. Additionally, a dollar shortage and the depreciation of the Bangladeshi taka have further complicated the investment outlook, as investors weigh their ability to recoup their investments.
The banking sector’s performance has also affected investor sentiment, with international rating agencies downgrading its creditworthiness, leading to a reduction in credit lines with foreign banks. Bankers noted that this negative perception has discouraged some investors from committing funds amid concerns about economic stability.
The drop in foreign investment underscores the need for Bangladesh to address these economic challenges to foster a more favorable environment for future FDI.
Source: bdnews24.com
