Central Bank Of Bangladesh To Rationalize Forex Transactions To Attract Investment

May 11, 2008 12:18 p.m. EST

Dhaka, Bangladesh (AHN) - The central bank of Bangladesh Bank is going to rationalize the foreign exchange transactions to encourage foreign investors to invest in the country, the governor said on Sunday.

"We are taking steps in rationalizing the foreign exchange transactions to encourage increased foreign direct investment (FDI) and foreign portfolio investment in Bangladesh," Bangladesh Bank (BB), the country's central bank, Governor Salehuddin Ahmed said while speaking at the monthly meeting of the Foreign Investors' Chamber of Commerce and Industry (FICCI) in Dhaka on Sunday.

Dr. Ahmed also said that the regulatory bodies like the BB, Security Exchange Commission (SEC) and Board of Investment (BOI) are expected to deliver more responsive and efficient system to give quick results for facilitating foreign investment.

"The government intends to continue with these policies. Further reforms undertaken by the government will ensure more conducive policy environment," he noted.

Mentioning five problems for investment, the central bank chief said: "We must recognize the major problems that an investor faces while investing in Bangladesh, and find ways to solve them."

The BB governor said cost of production in Bangladesh is less compared to that of some other developing countries. "Besides, cheap labors are also available here. But lack of proper infrastructure may result in some rise in production costs in the country."

FICCI President Waliur Rahman Bhuiyan requested the governor to review the existing foreign exchange rules and regulations as well as traveling quota for facilitating the foreign investors.

He also urged the governor for taking effective measures to review corporate tax on banks and interest rates spread to help businesses.