Editorial Desk :
Media report said the government has issued a gazette notification allowing overseas investment by Bangladeshi companies in a bid to new business expansion abroad. The significant decision has been made as most leading business firms are bringing pressure on the government to allow investment on their capital account abroad. The new government guidelines said local firms can transfer fund on capital account for investment abroad, particularly exporters will be able to invest 20 per cent of average annual export earnings from their export retention quota for five years or less than 25 per cent of net assets shown in the latest audited annual financial report.
The Bangladesh Bank (BB) has issued the directive on Wednesday subject to several conditions. A 15-member selection committee with Bangladesh Bank governor in the chair will scrutinise application of aspirant firms. In fact, about a dozen big business houses have already their overseas investment with especial government permission and more such firms are seriously lobbying at a time when the Panama Papers involving
illegal investment by several dozen of Bangladeshi businessmen showed ban on such illegal investment is not working.
Overseas investment at designated places or regions is highly profitable at exempted tax or under highly favourable business conditions. We believe the new decision will make possible overseas investment with due government permission on outward movement of capital and inward movement of business benefits. The bigger gray area of capital flight will thus become transparent. Under the rules as we see all capital transfer for new company will take place under strict Bangladesh Bank supervision and all receipts will be taken back such as profit or company dividend etc must be transparently taken back within 30 days of receipt. Any violation of the rules will be treated as money laundering and to be punished.
We know that such overseas investment will allow regular transfer of huge fund abroad which could be otherwise invested within the country to create jobs and income generation activities for millions. It means it will help socio-economic development of other countries depriving our own country. But it is also true that in a globalised economy investment can’t be held in check. So, Bangladesh is landing to a new phase of global business expansion and a strict regulatory system must be at work to keep it accountable.
