FDI Shrunk by Over 7%

Economic Tag: FDI

Foreign direct investment (FDI) has shrunk by over 7.0%, totaling $3.2 billion in fiscal year 2023, as reported by the central bank. The persistent volatility in the local forex market continues to deter investor confidence. During this period, equity investments dropped significantly, posing challenges to the country’s already strained economy. Disinvestment, which involves asset sales and liquidation, increased, attributed to potential fund withdrawals.

The Bangladesh Bank’s report reveals a 40.91% decrease in equity investment and a 40.14% decline in intra-company loans. However, reinvestment by existing foreign-owned companies surged by nearly 16%. The UK and the Republic of Korea were the top contributors to FDI, with other significant inflows from the Netherlands, Hong Kong, the USA, Singapore, and China.

Non-export processing zones (non-EPZ) attracted the highest net FDI inflows at around $2.8 billion, while export processing zones (EPZs) received $406 million, and economic zones (EZ) garnered nearly $4.2 million.

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