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November 11, 2000 

Dhaka, Nov 10 (UNB) - Prime Minister Sheikh Hasina today requested world business leaders to explore investment possibilities in all permissible sectors in Bangladesh redirecting FDI flows into developing countries.

The Prime Minister welcomed private investment from overseas sources in all areas of the economy bar four sectors, strategic from national security perspectives.

"I hope you would find Bangladesh the most worthwhile new destination for profitable investment business," she said inaugurating the ICC Asia Conference at a local hotel.

The Bangladesh Chapter of International Chamber of Commerce (ICC) hosted the two-day conference on "Investment in Developing Countries: Increasing Opportunities" with 235 participants from 24 countries, including host Bangladesh, taking part.

The Prime Minister said flow of foreign direct investment (FDI) is being directed to more developed regions slowing down into the developing countries, particularly in the region having the concentration of the largest number of world poor.

"If the trend continues unabated, the sufferings of the people of this region will further aggravate," she told international business leaders, policymakers, economists and members of the legal profession from home and abroad brooding over the issue in the meet.

She said the international leaders of trade, industry and commerce should come forward in support of the poor helpless people by ensuring steady and increasing flow of FDI to reverse the trend.

Hasina said Bangladesh is easily accessible from rest of the world by air, land and sea as located in-between the emerging markets of South Asia and fast-growing markets of Southeast Asia and ASEAN countries.

Infrastructure facilities are being developed to make the country one of the finest in the region as soon as possible, she told the gathering in presence of globally influential people who hold important posts of world business bodies.

Among them, the next WTO director general, Dr Supachai Panitchpakdi, ADB president Tadao Chino and Paris-based ICC secretary general Maria Livanos Cattaui addressed the function.

"Our country's needs for investment in infrastructures cannot be met from the government and domestic savings alone," she said.

Bangladesh is capable of attracting a significant part of the private capital now flowing into developing countries," Prime Minister Hasina said pinpointing macroeconomic and structural reforms effected as part of her government's overall market-friendly liberalisation programme.

Responding to the investment incentives, Hasina apprised the business moot, some 6,232 projects with an estimated investment of USD 13.291 billion have been registered with the Board of Investment (BOI). The investment proposals included 574 projects involving USD 8.539 billion with foreign investment from USA, UK, Malaysia, Japan, South Korea, Singapore, India, China, Taiwan, Germany, Hong Kong, Italy, Sri Lanka etc.

The investment incentives include 5-7 years tax holiday, repatriation of capital, profits and dividends, working capital loans from local banks and 15-year tax exemption on incomes of the private sector power-generation companies.

"For providing more facilities to the prospective investors, we have decided to develop more export processing zones (EPZs) other than two already developed in Chittagong and Dhaka," said the Prime Minister.

She observed that her government achieved success in maintaining a low inflation rate with moderate-to-high-growth open economy.

Following her government's massive programmes the number of people below the poverty line came down to 44 per cent in 1999 from 47 per cent in 1996, the growth rate averaged at 5.5 per cent and per-capita income rose to USD 386 from USD 280 in 1996.

Thai Deputy Prime Minister Dr Supachai, who holds the commerce portfolio, assured that he would give special attention to trade liberalisation and concerns of developing nations after taking office of the World Trade Organisation.

"It's our obligation to address the concerns of developing economies irrespective of our capacity and nations…We need to do more."

The would-be chief of the global trade body noted the collapse of Seattle meeting was a wake-up call for the least developed and developing countries. "I hope to see an effective WTO which would serve all its members so that a better balance of interests can be achieved."

Asian Development Bank president Tadao Chino referred to ADB's new strategy focussed on the importance of private sector investment in reducing poverty and supporting sustainable economic growth in the Asia and Pacific region.

He said the ADB developed a new private sector development strategy emphasising three mutually reinforcing strategic thrusts as a strong private sector does not always emerge by itself, especially in developing economies.

The thrusts consist of the Asian bank's support for creating an enabling environment to enhance private-sector activities, assistance for generating business opportunities and catalyzing private investments through direct financial assistance to the private sector, without government guarantee.

As part of the thrust, ADB is structuring a partial risk guarantee for the Meghnaghat power project, which will provide political risk protection for a loan of USD 70 million to be funded by a consortium of commercial banks.

"A strong and dynamic private sector is an essential ingredient for the successful integration of Asia within the world economy," Tadao said.

Addressing the function Commerce Minister Abdul Jalil said the Seattle experience conveyed messages of discomfort all over the world as regards inclusion of more and more issues in the WTO agenda.

"It's our expectation that the future round of trade negotiations should not be overburdened with newer items like competition policy, labour, environmental and social issues," he told the meet of world business leaders.

ICC Bangladesh president Mahbubur Rahman also addressed the function while UN-ESCAP executive secretary Kim Hak-Su presented the message from UN secretary general Kofi Annan.