ABSTRACT
This paper reviews foreign direct investment (FDI) inflows (registered and actual, and gross and net) into Bangladesh from the world and from Australia, makes a time series analysis of FDI flows, analyzes the competitive position of the country as a destination for FDI using the values for the 12 pillars of the Global Competitive Index developed by the World Economic Forum, assesses three important indices – the FDI Performance Index, FDI Potential Index and ease of doing business index – for the country and presents some arguments in favor of Australia’s choice of Bangladesh for FDI in general, as well as in some selected sectors of its economy. More than 80% of FDI flows into Bangladesh were in three sectors: energy, telecommunications and textiles. The leading source countries for FDI into Bangladesh are the UK, the USA, Egypt, South Korea, the Netherlands, Singapore, Hong Kong, the UAE, Japan, Norway, Malaysia and Australia. Australia is the 4th largest country in terms of FDI stock in Bangladesh. Bangladesh may be a good destination for FDI because it has a large market size, its exports are growing and diversified, it has potential for growth in sectors like energy, infrastructure and construction, manufacturing and Information and Communications Technology (ICT), it needs new technology and expert manpower and it performs relatively well in terms of the Global Competitive Index.
