THE flow of foreign investment to the country’s stock markets remained negative for the second consecutive year in 2019 mainly due to lack of investor’s confidence and unstable financial sector coupled with non-performing loans, high interest rate and pressure on exchange rate. Though earlier many foreign companies had expressed interest to invest at Dhaka Stock Exchange, all of them showed their back as the authorities concerned failed to revive the market condition. The net foreign sales were Tk 488 crore in 2019 after the investors had withdrawn Tk 593 crore in 2018. Out of 24 months, the foreign investors were the net sellers in 19 months — that indicates highly negative approach to the market. In particular, the government’s move to wind up non-bank financial institution People’s Leasing and Financial Services exposed the tragic condition of the stock market.
Country’s capital market not only remained bearish last year, there are more reasons for losing interests by the foreigners. One of them was declining of private sector credit growth to a nine-year low. Besides, negative export earnings for the last few months, failing to hit revenue collection target and heavy borrowing by the government have made the foreigners super-cautious about investing in Bangladesh. Moreover, the latest brawl between GrameenPhone and Bangladesh Telecommunication Regulatory Commission over an audit claim has almost certainly sent a negative message to the foreign investors.
Apart from the foreigners — what we see is that — the government has also failed to gain the public trust on the capital market while a remarkable number of local investors have left the trade losing their hard-earned money due to continuous fall of share prices. Even, those were involved in looting share market haven’t brought to book till the date. These irregularities must be stopped before the total economy is destabilised.
Country’s capital market not only remained bearish last year, there are more reasons for losing interests by the foreigners. One of them was declining of private sector credit growth to a nine-year low. Besides, negative export earnings for the last few months, failing to hit revenue collection target and heavy borrowing by the government have made the foreigners super-cautious about investing in Bangladesh. Moreover, the latest brawl between GrameenPhone and Bangladesh Telecommunication Regulatory Commission over an audit claim has almost certainly sent a negative message to the foreign investors.
Apart from the foreigners — what we see is that — the government has also failed to gain the public trust on the capital market while a remarkable number of local investors have left the trade losing their hard-earned money due to continuous fall of share prices. Even, those were involved in looting share market haven’t brought to book till the date. These irregularities must be stopped before the total economy is destabilised.
