FDI inflow rises by 66.79pc in six months

http://www.thefinancialexpress-bd.com/more.php?news_id=130439&date=2011-03-25

FDI inflow rises by 66.79pc in six months

FE Report

The country’s overall FDI (foreign direct investment) inflow rose by US$ 228.58 million or 66.79 per cent, to $570.80 million during the January-June period of 2010 over the corresponding period of 2009 due mainly to significant increase of equity capital inflow, the findings of the latest survey by Bangladesh Bank (BB) showed.

The inflow of equity capital marked a 253.99 per cent increase during the January-June period 2010, despite a significant fall in reinvested earnings and intra-company loans by 14.04 per cent and 68.28 per cent respectively during the same period, said the survey report on ‘Foreign Direct Investment in Bangladesh’.

On a fiscal year-on-year basis, the total FDI inflow dropped by $47.57 million or 4.95 per cent to $913.02 million in fiscal year (FY) 2010 compared to the increase of $191.90 million or 24.96 per cent in fiscal 2009 and decrease of $24.05 million or 3.03 per cent in fiscal 2008, the BB survey revealed.

According to the survey, the reinvested earnings decreased by US$ 25.00 million or 14.04 per cent to $153.05 million during January-June, 2010 compared to the decrease of $8.84 million or 4.73 per cent over July-December, 2009 and an increase of $37.17 million or 24.83 per cent during the same period of the previous year.

Intra-company loans, the survey said, decreased by $34.62 million or 68.28 per cent to $16.08 million during January June, 20 10 compared to a decrease of $15.27 million or 23.15 per cent during the previous July-December period of the year 2009 and an increase of $43.38 million or 192.03 during the same period of the last year.

FDI inflow to non-export processing zone (EPZ) areas during January-June, 2010 stood at $501.65 million which was 87.89 per cent of the aggregate amount, the central bank report said.

In the previous corresponding period in fiscal 2009, the figure was $260.26 million and 76.05 per cent of total inflows, it revealed.

The components of FDI inflow in non-EPZ areas during January-June period of 2010 showed that equity capital, reinvested earnings and intra-company loans shared by $395.07 million, $105.08 million and $1.50 million respectively.

On the other hand, inflow of FDI in EPZ areas during January-June, 2010 amounted to $69.15 million which was 12.11 per cent of the total inflow, said the BB survey.

In the corresponding period between July and December, 2009, the amount stood at $81.96 million and 23.95 per cent of the total, it said.

The break-up components of FDI inflow to EPZ areas during January June, 2010 showed that equity capital, reinvested earnings and intra-company loans shared by $6.60 million, $47.97 million and $14.58 million respectively.

The aggregate amount of FDI inflows to non-EPZ areas increased by $241.39 million or 92.75 per cent to $501.65 million during the period under review compared to a decrease of $37.76 million or 12.67 per cent during July-December period of 2009. The amount showed a decrease of $235.21 million or 44.11 per cent during the same period of the last year.

In EPZ areas, total FDI inflows decreased by $12.81 million or 15.63 per cent to $69.15 million during January-June period of 2010 compared to the increased by $22.04 million or 36.78 per cent during the previous July-December period of 2009.

The amount was $9.50 million or 13.68 per cent down from that of the same period of the last year, the BB survey mentioned.

Giving sector-wise break-up, the BB survey said the FDI inflow to telecommunication sector marked a significant rise by $243.36 million or 240.40 per cent to $344.59 million during January-June, 2010 compared to the decrease of $47.68 million or 32.02 per cent and $281.80 million or 65.43 per cent respectively during the second half in 2009.

The inflow of FDI to textile and wearing sector also increased by $8.80 million or 11.80 per cent to $83.37 million during January-June period of 2010 compared to an increase of $15.17 million or 25.54 per cent and a decrease of $11.55 million or 16.28 per cent respectively during the corresponding period in 2009 and that of the year before that, it said.

FDI inflow to banking sector marked an increased by $2.46 million or 4.51 per cent to $57.01 million during January-June period of 2010, reflecting a decrease of $33.47 million or 38.03 per cent and an increase of $65.84 million or 296.84 per cent during the previous second-half period in 2009 and the corresponding one in 2008 respectively.

The inflow of FDI to gas & petroleum sector, however, increased by $20.07 million or 238.93 per cent to $28.47 million during January-June period of 2010 compared to a decrease of $3.49 million or 29.35 per cent and an increase of $0.29 million or 2.50 per cent respectively during the previous second-half period in 2009 and also of same period in 2008 respectively.

There was a marked downward trend about FDI inflow to power sector – showing a decline by $1.37 million or 7.18 per cent to $ 17.71 million during January-June period of 2010 compared to increases of $7.30 million or 61.97 per cent and $0.16 million or 1.38 per cent during the previous second-half of 2009 and the same corresponding period in 2008.

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