Bangladesh desperately woos $10bn investment from UAE

The government keenly wants to bring the UAE-pledged $10 billion investment to Bangladesh to recover the economy jolted by coronavirus pandemic, officials said.

The Tk 85,000 crore investment can make a difference to Bangladesh’s employment generation and further boost its exports, Commerce Ministry officials added.

The officials are brainstorming on various potential sectors, such as, power, energy, port and infrastructure to maximise benefits of the epic investment.

An official of the commerce ministry said, “That investment has been delayed due to various crises including global Covid-19 pandemic. With some improvement in the situation, foreign investors are now optimistic about Bangladesh’s economic performance.”

An important meeting of the Joint Trade Commission (JTC) between Bangladesh and the United Arab Emirates is going to be held early August, this year. The UAE wants to discuss the investment opportunities in Bangladesh before the official meeting takes place. A concept paper will be presented by the government to UAE officials soon, Commerce Ministry officials pointed out.

It is learned that some new strategies have been developed to enhance bilateral trade and investment with the entire Middle East, including the United Arab Emirates. The ministry has started forging tactics to persuade it to bring back the investment initiatives that were shelved due to Covid-19.

In August last year, a number of proposals were worked out by officials emphasizing trade and investments from the Kingdom of Saudi Arabia, Kuwait, the United Arab Emirates and Uzbekistan. The officials put their maximum importance on Bangladesh’s export growth and drawing foreign direct investments. At that time, Commerce Minister Tipu Munshi called on the ambassadors of the three Middle Eastern countries urging them to play an active role in increasing Bangladesh’s export shipments. Saudi Arabia, it is learnt, has already pledged to work together on 31 issues to optimize trade and investment interests.

Commerce Ministry officials said that if the vowed investment is properly channelised, Bangladesh’s exports will be expanded further to be coupled with inbound investments.

Making his point, a senior official of the Ministry of Commerce told Business Insider Bangladesh Saturday that in the upcoming meeting of the Joint Trade Commission with the United Arab Emirates, the government would emphasise on bringing their promised investment.

The Western Asian country has proposed to invest around Tk 85,000 crore in various sectors of the country, including power and infrastructure. So far no investment has made its way to Dhaka, though. Officials claim that any tangible progress was halted by the Coronavirus pandemic.

The officials are expecting to present Bangladesh’s entire gamut of investment opportunities before the Joint Trade Commission meeting of the two countries this year.

They insisted that the UAE is interested in investing in Bangladesh which they let Dhaka know through the Foreign Ministry.

“Hopefully, the next meeting of the Joint Trade Commission will bring some fruits to this end,” the official said.

Former finance adviser to the caretaker government Dr AB Mirza Azizul Islam on Saturday told the Business Insider Bangladesh that the government needed some money from external sources badly to cope coronavirus pandemic impacts.

“If the UAE funds some projects here that will create jobs in the country at a time when employment generation is crucial for the betterment of the economy,” Mirza Azizul said.

In January, the Dubai-based angel investor Falcon Network invested in pharmacy and healthcare in Bangladesh.

Arogga, a Dhaka based start-up, has developed a digital pharmacy and healthcare software that allows patients to easily manage, order and track the delivery of medication and healthcare products in an affordable way.

Experts say ME countries have a great deal of demands for Bangladeshi products. The sales of Bangladesh’s halal food, medicine, clothing, plastic and jute products have been increasing day by day in the ME markets. Hundreds of thousands expatriates working in different ME countries consume Bangladeshi products. Besides, ethnic Arabians are also developing interest in Bangladeshi products.

Despite a steady hike in the demand, home products are not seeing much shipments into the ME markets, as experts blame various red-tapes, slow customs procedures and lack of interest on the part of bureaucrats.

Officials now say, works are progressing to reduce bottlenecks and increase bilateral investment and trade. In the last few years, Bangladesh has signed hundreds of agreements and memorandum of understandings on investment and trade with Saudi Arabia, Kuwait, the United Arab Emirates and Uzbekistan, documents show.

Foreign investment is making its way to Bangladesh. Foreign exchange reserves are building up and purchase orders of major export products are seeing momentum.

The Cabinet has already approved an agreement between the Kingdom of Saudi Arabia and the People’s Republic of Bangladesh on cooperation and mutual assistance in customs matters.

Statistics show that Bangladesh has got the highest bilateral trade and investment ties with Saudi Arabia in the Middle East. The agricultural sector of Bangladesh cannot go well without the fertilizer of Saudi Arabia. And, remittance from that country is aiding Bangladesh to raise the income level of migrant families in the periphery. Moreover, the country has expressed its interest in investing in Bangladesh’s power, energy, infrastructure, services, telecommunications, medical and tourism sectors. Dozens of agreements and MoUs have already been signed to take things ahead. But everything seems to have stumbled because of the lethal Coronavirus. In such a backdrop, the cabinet approved a draft customs agreement with Saudi Arabia.

A few months ago, a meeting of the joint commission was held in Bangladesh. The next technical meeting will be called soon, officials said.

The government gets optimistic about the meeting of the Joint Trade Commission after a positive decision came from the United Arab Emirates. The Ministry of Commerce is now busy doing paper works for inking concrete investment and trade agreements.

Necessary documents have been sought from the Ministry of Foreign Affairs and other departments to accelerate the process. The JTC is likely to meet in the first week of August. Earlier, the investment proposals were officially announced at a conference organised by the Bangladesh Economic Forum, last year. It was when the Prime Minister’s private industry affairs adviser Salman Fazlur Rahman had held a conference at the Conrad Hotel in Dubai.

Officials of Bangladesh Investment Development Authority, Bangladesh Economic Zones Authority and Bangladesh Hi-Tech Park Authority also attended the conference. It was at that meeting that the first investment promise of Tk 85,000 crore was disclosed. Besides, during the visit of Prime Minister Sheikh Hasina to Abu Dhabi in 2019, four MoUs were signed with the United Arab Emirates on power, energy and economic zones of Bangladesh.

Emirates National Oil Company has an agreement in place with the Ministry of Power, Energy and Mineral Resources of Bangladesh. Through this agreement, the UAE has already been selling LNG to Bangladesh. The UAE has expressed interest in creating a separate economic zone in Bangladesh by 2023 to boost Bangladesh’s trade.

Not only products and trade, UAE has been a top destination for Bangladesh’s outbound workers. Some seven lakh Bangladeshis now live in the UAE, after Malaysia where most Bangladeshi expatriates now reside.