Bangladesh experiences a decline in investments in 2022

Foreign direct investment from the US decreased by half between January and June 2022 compared to the prior six months, according to a Bangladesh Bank study titled “Foreign Direct Investment and External Debt.” The lack of FDI-friendly conditions in the nation and the US sanctions imposed on RAB and seven of its current and former officials on December 10th, 2021, are to blame for this.

As 94% of American investment was equity capital, total equity capital decreased by 38% to $515.32 million in June of last year from $831.62 million in December of the previous year as a result of a decline in US FDI. Inflows of long-term loans into the US private sector fell to $749 million in January–June 2022, a 6.5% decrease from July–December 2021.

The majority of US investment is centered in the energy industry, with gas and petroleum accounting for 46% of all investment in FY22. The financial sector received the second-highest amount of investment during the year, with $260 million going to non-bank financial institutions. Up until June 2022, America had a $4.15 billion total FDI stock, of which around $3 billion was still available.

Source for more details:   

The Business Standard

Diplomats warned that Bangladesh’s government’s efforts to protect user data in the digital world through the Data Protection Act could backfire by causing a decline in foreign direct investments. The draft online platform regulations have drawn criticism from the US ambassador to Dhaka, Peter Haas, and the British high commissioner to Bangladesh, Robert Chatterton Dickson. Among their issues are the vague definitions of what constitutes illegal online content and the recent announcement that 191 online news portals will be blocked.

According to Haas, the regulations could have an impact on human rights and harm the culture of innovation. According to Chatterton, there is a possibility that the regulation might affect much-needed investment.  However, an important fact is that Bangladesh is moving toward becoming a “Smart Bangladesh” and that a data protection act is required to safeguard people’s rights and satisfy the growing need for data protection. The speaker emphasized the need for context and brought up the ICT and DSA acts, which were heavily criticized for being overbearing and ambiguous.

Source for more details:   

The Business Standard