Reported on: April 21, 2012 13:59 PM
Reported in: National
Doha (Qatar), Apr 21 (UNB) – Prime Minister Sheikh Haisna on Saturday underscored the importance of developing a greater consensus on investment alongside trade and finance to ensure real development and employ right approaches to face future economic and financial downturn.
“We must develop a greater consensus on investment alongside trade and finance to ensure development and to employ right approaches to face future economic and financial downturn,” she said while delivering her speech at the World Leaders Investment Summit here.
The Prime Minister also spelled out an eight-point observation for global consensus in changing business and investment relations for sustainable investment.
The observations are:
1. Larger public and private investment in agriculture covering food security, research, capacity building and production, thereby providing a scope for effective control on the risks related to price instability in food and agricultural commodities.
2. Remove impediments to infrastructure investment and increase in such investment in developing countries.
3. Controlling the fluctuating demand of non-equity modes of international production and arranging for development needs to be managed by the developing countries themselves for their own benefit.
4. Expected GDP growth in some developing countries to attract investment. This often is associated with inflow of “hot money” and portfolio investment resulting in exchange rate fluctuation. Hence, stabilization of capital flow is an important challenge,
5. TNCs and State Owned Enterprises are likely to dominate future global investment and will need to be controlled to avoid new protectionist tendencies.
6. A balanced view of political risks may help global flow of FDIs in developing countries. Developed countries may assure potential investors through appropriate mechanism.
7. Improved international coordination for regulating to avoid investment protectionism as is being done to control certain forms of subsidies in the WTO framework.
8. A balance in labor intensive investment and productivity enhancement investment, are essential to spur long term demand, boost global growth, and create job opportunities.
Sheikh Hasina said that challenges for policymakers on deciding FDI and Industrial Policies are complex while identifying right industries and right policies are critical.
She said export industries may not necessarily have the greatest impact on employment or value addition. “We need to nurture the selected industries and at the same time focus on emerging industries.”
The Prime Minister said that the UNCTAD may work with relevant private and public stakeholders, and help on this difficult task.
“New challenges have appeared in the globalized world calling for reforms in the governance of global trade, and in the economic transactions as progress in the Doha Round has been slow and investment around the world, uncertain.”
She said there is an urgent need for low carbon development following the impacts of climate change, and newer services, calling for changes in industrial relations.
Hasina observed that enhancing productivity and maximizing profits are also bringing changes in the investment landscape.
She said that businesses activities are constantly adjusting themselves to create opportunities amidst new challenges as the states are finding it difficult to balance people’s interest and the new trends in businesses.
The Prime Minister said that Bangladesh too is not outside the scenario. “Fortunately, we have managed to maintain sound macroeconomic fundamentals with suitable policy measures.”
She said that the growth has been 6.7 percent last year and is expected to be around 7 percent this year. “Our aim is to raise growth rate to double digits by 2017 and sustain it till 2021 to become a middle income country.”
Hasina called upon all of to invest in Bangladesh for secured profitable returns and help the country in spurring sustainable development, create employment and attain development goals. “Bangladesh has the most liberal and attractive investment policies in the region.”
She said Bangladesh’s strategic location between South and South East Asia and closeness to China is unique. “Therefore, we’ve been making all efforts to develop strong regional connectivity with roads, railways and waterways, and become the economic hub of the region.”
Moreover, the Prime Minister said, Bangladesh’s local market of 160 million and the regional market of 3 billion people is also growing up steadily in terms of purchasing power and consumption.
“In addition our business sector boasts of innovative entrepreneurs, efficient managers and skilled labor at competitive wages.”
She noted that assessing Bangladesh’s present policies and potential, Goldman Sachs has ranked it as one of the 11 emerging economies after BRIC; JP Morgan has included it in the list of ‘Frontier Five’; Standard and Poor has rated it a BB; and Moody’s as Ba3 for successive years.
Hasina said Bangladesh’s development deficit is due to the inadequate infrastructure and energy. “We have, therefore, increased public sector investment in infrastructure, energy. Private sector investment is also increasing.”
She said her government is encouraging Public-Private-Partnership (PPP) in the construction of highways, multi-purpose bridges, power stations, airports, and seaports.
“Though investment is increasing, it is unable to keep pace with the demand,” she told the conference.
The Prime Minister also mentioned that the government has adopted and is implementing FDI policies offering most friendly fiscal and financial incentives with stable regulatory framework.
She said: “Investors are invited to invest in infrastructures, energy, transport connectivity, textiles, shipbuilding, pharmaceuticals, ceramics, leather products, light engineering, telecommunications and ICT, etc.”
Hasina said that investors can reap the benefit of Duty Free and Quota Free market access to major economies that we enjoy. “Nine special economic zones are under the process of completion,” she added.
Qatar’s Deputy Prime Minister and Minister of Cabinet Affairs Ahmed bin Abdullah Al Mahmoud also spoke on the occasion. Later, panelists began discussion on the Prime Minister’s speech.
UNCTAD secretary general Dr. Supachai Panitchpakdi was present.