BB asked to make wholesale changes to policies to pull in FDI
The finance ministry has directed the Bangladesh Bank to make wholesale changes to the policies that could be considered systematic faults or dissuade foreign direct investment (FDI) in the post-coronavirus era. In a letter to the central bank on June 23, the ministry asked it to take initiatives that would provide foreign investors with the scope to transfer profits back home or shift their operations to other countries without hassles. Vietnam, India and Indonesia are all amending rules and regulations in the financial sector to create investment-friendly environments that will attract more FDIs. It came as gross inflow of foreign direct investment to Bangladesh fell 13.8 per cent to $3.73 billion in the first 11 months of the last fiscal year, BB data showed. Net FDI dropped 19.04 per cent year-on-year to $1.97 billion. Bangladesh has rules and regulations to attract FDI but bureaucratic complexities sometimes cause delays for foreign investors. These complexities should be removed. The Beza plans to introduce a generous incentive package to perk up the country’s investment climate and attract more foreign investors to economic zones in the post-coronavirus era when companies will search for new destinations to set up operations at reduced costs.
Govt revenue from DSE hits 10-year low
The government’s revenue earnings from the Dhaka Stock Exchange (DSE) hit more than 10 years low to Tk 1.04 billion in the just concluded fiscal year (FY) 2019-20due to bearish market trend. Market operators said the sluggish market turnover coupled with trading suspension for more than two months due to Covid-19 outbreak hit the government’s revenue earnings from the prime bourse. Trading on the bourses remained shut for 66 days (March 26 to May 30), the longest closure of the market since the Liberation War, due to government holidays as part of its efforts to contain the spread of the deadly Covid-19 virus. The government bagged revenue worth Tk1.04 billion in the FY 2019-20, which was Tk 2.51 billion in the FY 2018-19, registering a decline of 58 per cent, according to statistics from the DSE. Of the total earnings in the FY2019-20, Tk689 million came from the TREC (trading right entitlement certificate) holders’ commission, popularly known as brokerage commission. And Tk346 million came from the share sales by sponsor-directors and placement holders, the DSE data shows. The DSE, on behalf of the government, collects the tax as TREC holders’ commission at a rate of 0.05 per cent and from sponsor-directors’ and placement holders’ shares sales at a rate of 5.0 per cent. The bourse then deposits the amount to the public exchequer. The DSE paid tax worth Tk 2.72 billion in FY 2011-12, Tk 1.27 billion in FY 2012-13, Tk 1.54 billion in FY 2013-14, Tk 1.74 billion in FY 2014-15, Tk 1.58 billion in FY 2015-16, Tk 2.46 billion in FY 2016-17, Tk 2.33 billion in FY 2017-18 and Tk 2.51 billion in FY 2018-2019 on TREC holders’ commission and share sales by sponsor-directors and placement holders. However, the DSE paid tax worth Tk 4.47 billion in the FY2010-11, the highest in its history, when the market witnessed a wild trend before crashing.
Bangladesh lags behind Asia Pacific peers in telecom services: GSMA
In the digital age, Bangladesh’s mobile telecom market is still dominated by the second generation (2G) services while scenarios in other Asia Pacific countries are quite different and are predominated by 4G services, according to a GSMA report published on Monday. The 2G technology is the mobile communications standard allowing mostly voice calls, SMS and limited data transmission while 4G is more data driven. By 2025 Bangladesh will be a data driven market where 4G service will dominate with a 46 per cent share, reads The Groupe Speciale Mobile Association (GSMA) report “The Mobile Economy Asia Pacific 2020”. However, Bangladesh is in a position below the average standard of the Asia Pacific countries in almost all the parameters and the situation will last long ever after five years, the report’s data shows. The GSMA ran the study in recent years with numbers of 2019 and estimates of 2025. According to the GSMA, at the end of 2019 about 54 per cent of people in Bangladesh were using mobile phones, of which 25 per cent had internet access. They estimated that unique user numbers will reach 59 per cent by 2025 and of it 38 per cent will be internet users. Bangladesh will get 25 million new internet users in these five years, they said. In 2025, of the total internet users of Bangladesh, only 6 per cent will use 5G while 4G will dominate the market having 46 per cent of the total data users. At that time 3G users will amount to 30 per cent and 18 per cent will still be connected to 2G. However, at the end of 2019, only 10 per cent of internet users had 4G connections in this market, 40 per cent 3G and half of the mobile phone users just using it for calling purposes. Apart from Bangladesh, Pakistan is the other country where 2G is still dominating the market. Bangladesh is also the worst in position when it comes to using smartphones, even worse than Pakistan. Currently smartphone penetration in Bangladesh is only 40 per cent and it will reach 69 per cent after five years, reads the report. In Pakistan smartphone penetration is 46 per cent and it will grow up to 85 per cent by 2025.
Prime Bank, BACCO launch alliance
Prime Bank Limited and Bangladesh Association of Call Center and Outsourcing (BACCO) have joined hands together to facilitate financing for the entrepreneurs in the field of call center and outsourcing. Managing Director and CEO of Prime Bank Rahel Ahmed and President of BACCO Wahidur Rahman Sharif formally launched the alliance through a virtual press meet on Wednesday. The partnership titled “Prime Bank-BACCO Alliance for MSME Financing Solutions” will enable easy access to finance to BPO/Outsourcing companies as they strive for market expansion locally and globally. It will be a big boost for the country’s BPO/Outsourcing sector as eligible BACCO members can now avail collateral-free loan up to BDT 5.0 million and other tailor-made financing solutions. The entrepreneurs can make more contribution to the country’s economy.
Dutch-Bangla Bank approves 25pc dividend
The 24th Annual General Meeting (AGM) of Dutch-Bangla Bank Limited was held on Wednesday through virtual platform under the Chairmanship of Sayem Ahmed, Chairman of the board of directors of the bank, said a statement. In the AGM, shareholders approved 25 per cent dividend (15 per cent cash dividend and 10 per cent stock dividend per share) for the year 2019. Despite of Covid-19, a large number of shareholders virtually participated in the AGM of the bank. The chairman welcomed the shareholders in the AGM. The audited financial statements for the bank for the year ended December 31, 2019 were placed before the AGM and a number of shareholders discussed the performance of the bank. The shareholders made various observations and suggestions on performance of the Bank for the year 2019.