FE Report

Bangladesh offers immense opportunities for raising funds from banks and other domestic sources for necessary business expansion, said former finance and planning adviser to caretaker government Dr AB Mirza Azizul Islam at a seminar Tuesday.

"The country's banking sector was not exposed to the toxic items that led to the global financial meltdown, and the capital market here is one of the best performing markets around the world," he said.

Bangladesh's capital market is vibrant and sound, its capitalisation accounts for around 21 per cent of the gross domestic product (GDP), while the banking sector has escaped the fallouts from the global meltdown, he said.

Urging the German entrepreneurs to invest in a number of prospective sectors here including manufacturing, agro-processing, telecommunication, energy, transport and water resources, Dr Islam said the country has a liberal foreign direct investment (FDI) policy, which ensures full repatriation of investment.

The former adviser was speaking as the special guest at the seminar on 'Investment climate and economic prospects for Bangladesh,' organised by Bangladesh-German Chamber of Commerce and Industry (BGCCI) at a city hotel.

A high-power business delegation from OAV-German Asia Pacific Business Association took part in the seminar, also attended by Chairman of Policy Research Institute (PRI) of Bangladesh Dr Zaidi Sattar.

The PRI chief identified the energy supply crunch as the country's main constraint for achieving rapid growth.

"The country has been maintaining a GDP growth of six per cent on an average for several years, but to attain higher GDP growth of 8-10 per cent the country needs to improve the energy sector," he said.

The GDP growth would not be sustained without developing the energy sector, said Dr Sattar, a former World Bank senior economist.

He said non-integration of the country's financial system with the global system might be a weakness too, as they were losing a lot of opportunities due to it.

The country might require investments worth US$50 billion in next 10 years. Increased investment from the public sector and FDI would thus be required along with the private sector investment, he added.

"Bangladesh could be a very good destination for Germany, not only for importing goods but also for marketing their products in a large market with a population of 150 million," said Managing Director of Citibank NA in Bangladesh Mamun Rashid.

Director of German KFW in Dhaka Christopher Isenmann said Bangladesh's GDP growth could be beyond seven per cent, if the bottlenecks like energy supply crunch and poor transportation system could be removed.

German Ambassador in Bangladesh Holger Michael said: "Bangladesh offers plenty of new investment opportunities. There might be some problems and constraints to investing here, which could be removed with support from the BGCCI."