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Foreign direct investment (FDI) in Bangladesh has declined amid falling foreign reserves, dropping from $21.58 billion in December 2021 (with $46 billion in reserves) to $20.54 billion in December 2023 (with reserves at $21.86 billion). While reinvested earnings and intracompany loans showed positive trends, new capital inflows remained weak. The decline is linked to macroeconomic instability, high inflation, banking sector issues, and difficulties in profit repatriation. This environment has hindered Bangladesh’s ability to attract investments, especially as global investors seek alternatives to China post-Covid.
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