SwissPro | Frankfurt, 30.03.2016.
July-January FDI rises over 30%
Bangladesh received over USD 1.22 billion net Foreign Direct Investment (FDI) in the first seven months (July-January) of the current fiscal year. The amount is 30.4% more than the net FDI received in the same period in the financial year 2014-15. The rise in FDI means that an environment of investment has been created in the country. Bangladesh is getting attractive to the foreign investors.
The continuous GDP growth of over 6% has added gloss to Bangladesh’s image. It has positively affected the foreign investment. The net FDI was USD1.7 billion in 2014-15 fiscal year and a little over USD1.43 billion in 2013-14. The FDI in Bangladesh’s capital market, however, dropped sharply in July-January period to USD 8 million from last fiscal year’s USD316 million.
Bangladesh appoints new Governor after Central Bank chief resigns over USD 101 million reserve heist
Amid widespread criticism over a USD 101 million heist from a Bangladesh Bank account with the New York Federal Reserve Bank, the country’s central bank Governor Atiur Rahman has resigned citing “moral grounds“. The matter sparked huge uproar in Bangladesh after local and foreign media last week reported that Bangladesh Bank money had been stolen and transferred to Sri Lanka and the Philippines by hackers last month. Some USD 20 million of the stolen money has so far been reportedly recovered. Bangladeshi Finance Minister AMA Muhith, however, announced that steps are under way to appoint former Finance Secretary Fazle Kabir, who is now chairman of the state-owned Sonali Bank’s board, as the new central bank chief. A three-member high-powered committee has also been formed to investigate the heist. Also Bangladesh Bank filed a case against unidentified people for the reserve heist. The hacking took place on the night of February 4, using information stolen through malware.
Trade gap rises to USD 3.75bn in 7 months
The country’s trade deficit slightly increased to USD 3.75 billion in the first seven months of the current financial year of 2015-16 compared with that of USD 3.57 billion in the same period of FY15 due to an increase in import payments. The trade deficit had risen by 27.95 percent in the July-January period of FY15 compared with that of USD 2.79 billion in the same period of FY14. The country posted a record trade gap in last financial year but the deficit decreased significantly in the first four months of FY16 due to a massive drop in import payments. The trade deficit hat hit its all-time high at USD 9.91 billion in FY15. The trade gap, however, increased slightly in the November-January period as the imports picked up during the period.
Tax receipts rise as export, import get a boost
Tax collection rose 14 percent year-on-year to BDT 11,387 crore in February, on the back of increased exports and imports in recent months. Overall, the tax authority collected BT 91,355 crore in July-February this fiscal year, registering 14.42 percent growth over the same period a year ago. However, the amount fell short BDT 12,810 crore of the target at BDT 104,165 crore for the eight-month period. So far, collection stood at 51 percent of the total target of BDT 176,370 crore for fiscal 2015-16. It means that NBR will have to collect the rest in four months. Import grew 6.73 percent in July-January this fiscal year compared to the same period last year, while exports rose 9 percent in July-February. However, the growth in direct and indirect tax collection from domestic sources slowed. Total collection of indirect taxes from domestic economic activities rose 15 percent to BDT 35,217 crore in July-February.
Draft of new industrial policy gets cabinet nod
The cabinet approved the draft National Industrial Policy-2016 aimed at increasing industrialization and investment in the country. Foreigners will have to double investments in Bangladesh to get Bangladeshi citizenship. Any foreigner who will invest USD 1 million in Bangladesh or transfer USD 2 million to any recognized financial institution in the country will get Bangladeshi citizenship. The amounts, as per the National Industry Policy-2010, were USD 0.5 million and USD 1 million respectively. In addition, the amount of investment to get temporary residency in Bangladesh while doing business in the country has also been increased to USD 200,000 from USD 75,000 in the past. The draft policy has a guideline to set up infrastructure for industrial clusters and industrial parks in the underdeveloped areas in order to establish economic zones.
Have a successful day and best regards
Christian
Christian Forthuber
Managing Director
SwissPro Invest (BD) Ltd.
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