The US firms have a significant amount of investment in Bangladesh, which is expected to increase, but they have been facing a number of problems in running the business here, an official of the Foreign Commercial Service (FCS) at the US Embassy in Dhaka has said.
The foreign firms face hurdles including payment issues, difficulties in repatriation of earnings, the formation of unclear rules, insufficient enforcement of intellectual property rights, and transportation problems, said FCS Commercial Counselor John Fay at a meeting on "Enhancing US-BD Commercial Cooperation", organised by the American Chamber of Commerce in Bangladesh in a Dhaka hotel on Thursday.
John Fay said, "All these issues limit Bangladesh's ability to achieve its full trading potential and create disincentives for additional foreign investment. My goal is for our office to work constructively with Bangladesh government officials and stakeholders to address these challenges that the US industry faces in the market."
Fay said the US industry stands as Bangladesh's largest foreign investor, with a total of $4 billion in investment, and expressed his hope that the figure would grow.
He said logistical and transportation infrastructure gaps hinder efficient trade in goods, creating disincentives for further foreign investment.
Fay also said resolving the challenges would not only benefit US firms; it would also contribute to enhancing the overall trade and investment climate in Bangladesh.
In addition, Fay outlined a proactive approach to trade promotion, identifying sectors where US firms can export to Bangladesh for mutual benefit.
The bilateral trade between the US and Bangladesh has witnessed significant growth, currently standing at $14 billion.
Fay noted that the trade relationship between the two countries remains concentrated in specific sectors, with Bangladesh primarily exporting apparel-related products while the US focuses on sectors like steel and agriculture.
He emphasised the potential for diversification into new industry sectors, including healthcare, ICT, education, energy, and trade and commerce infrastructure.
These sectors, if developed strategically, hold promise for future investments in Bangladesh's journey towards middle-income status and greater prosperity.
Businessmen call for more US investment in Bangladesh
On Thursday's meeting, businessmen called for more US investment in the country as the bilateral trade volume between the two countries is way lower than that between Bangladesh's competitors and the US.
At the meeting, Abdul Monem Economic Zone Director A Gafur said the bilateral trade between the US and Bangladesh amounts to $14 billion, but between the US and Vietnam, it reached $138 billion – $127 Billion for Vietnam and $11 Billion for the US – in 2022.
A Gafur said, "We talk about $4.3 billion in US investment in Bangladesh, but it is not enough. It should be $20 billion by this time. The bilateral trade between the US and Bangladesh should be at least $50 billion."
In response to Gafur's comments, John Fay said there are reasons why US companies invest more in other countries than in Bangladesh. Investors find Vietnam's stable macroeconomic statistics and ease of doing business more attractive. More US companies will come to Bangladesh if they see a better environment here.
He also said weak logistics support, delays in customs clearance, and regulatory clearance issues waste the traders' time in Bangladesh.
President of the American Chamber of Commerce in Bangladesh (AmCham) Syed Ershad Ahmed, and Vice President Syed Mohammad Kamal attended the meeting.