Vietnam holds 13 times more foreign direct investment (FDI) stock than Bangladesh, while Indonesia has nearly 17 times and Cambodia about three times more, highlighting a widening regional gap and the need for reforms, a report showed.
The United Nations Conference on Trade and Development (UNCTAD) Investment Policy Review (IPR) Implementation Report for Bangladesh, launched in Dhaka on Monday by the United Nations Development Programme (UNDP) in partnership with UNCTAD and the Bangladesh Investment Development Authority (BIDA), said Bangladesh’s FDI stock stood at $18.29 billion in 2024. The figure compares with $249.14 billion in Vietnam, $305.66 billion in Indonesia and $52.66 billion in Cambodia.
The gap reflects persistently weak inflows, with FDI declining by nearly one-third from over $1.8 billion in 2019 to 2024 levels, falling below the early Covid-19 period, the report said.
Structural and macroeconomic pressures drove the slowdown, including about 36 per cent depreciation of the taka since 2021 and persistent foreign exchange shortages that delayed import payments and disrupted industrial supply chains, particularly in energy.
Political and social developments in 2023 and 2024, including factory closures and labour unrest in the garment sector, further weakened investor confidence. GDP growth slowed from 8 per cent in 2019 to 4 per cent in 2024, while inflation rose from 5.5 per cent to nearly 10 per cent.
BIDA Executive Chairman Chowdhury Ashik Mahmud Bin Harun said attracting quality investment is key to economic transformation, diversification, technology transfer and jobs as Bangladesh prepares for LDC graduation and Vision 2041. He said reforms must shift from planning to execution.
UNDP Bangladesh Deputy Resident Representative Sonali Dayaratne said coherent policies and strong institutions are essential to attract investment that creates jobs, supports innovation and ensures inclusive growth.
The report, prepared by UNCTAD at BIDA’s request, reviewed progress since 2013, noting gains such as establishing BIDA as the lead facilitation agency and expanding digital investment services.
It recommended a unified national investment policy, a consolidated investment law, and full digitalisation of procedures to improve competitiveness and investor experience. It also stressed stronger institutional capacity and greater policy transparency and predictability.
Early indicators for 2025 show modest recovery, driven by reinvested earnings and intra-company loans, alongside easing inflation and improved growth momentum. Quoting the International Monetary Fund, the report said restoring macroeconomic and political stability could gradually rebuild investor confidence.
The dialogue brought together senior government officials, private sector representatives and development partners. UNCTAD Legal Officer Kiyoshi Adachi presented the keynote, while UNDP Bangladesh Country Economic Advisor Owais Parray moderated a panel.
Speakers included Policy Exchange Bangladesh Chairman M Masrur Reaz, former BIDA Director General Md Ariful Hoque, BUILD CEO Ferdaus Ara Begum and Trade Policy and Facilitation Expert Md Hafizur Rahman. The event was chaired by BIDA Executive Member Md Humayun Kabir.
The programme was held under the Transformative Economic Policy Programme, supported by the UK government and implemented by UNDP Bangladesh to strengthen economic governance and support evidence-based reforms.
