Post-Coronavirus, the world economy will undergo a major shift, as major production companies look to relocate their manufacturing units out of China to other South Asian countries. This provides an excellent opportunity to Bangladesh to expand and diversify its production facilities and reach a greater worldwide market. Therefore, Bangladesh should take immediate steps to enhance economic diplomacy to attract the foreign direct investments which are destined to bounce back from China in the post-Corona world situation. Furthermore, the US-China trade war will also accelerate more US and Japanese firms to opt out of China.
Both Vietnam and India, our competitors in attracting FDI, have already started their economic diplomacy to attract these firms. Compared to Bangladesh, Vietnam is in a strategically better position due to proximity, improved investment environment and FDI-focused infrastructures. India is also improving its political understanding with the US to get inflow of out-of-China US FDIs.According to Dr Atiur Rahman, “If we really want to get similar inflows we need speedy economic and strategic diplomacy in addition to improving overall investment environment. BIDA has already started to take some moves on regulatory easing moves but more is needed to attract FDIs. The ‘business as usual’ attitude will not do. We need concrete actions on the ground.”
India, Vietnam and other developing countries have prepared policy and infrastructure to attract foreign investors escaping from China following the worldwide pandemic. Though Bangladesh has also taken significant steps to stay ahead in the race in the field of economy, but nothing must be left to chance in today’s competitive world economic situation.
As Japan has already indicated it wants national businesses to shift manufacturing out of China, we should pursue our good cultural and economic relation with Japan to get major portion of these businesses into our country. Of the total 1 trillion US dollar stimulus package, Japanese government specified 200 million US dollar to companies for shifting manufacturing base to other Asian countries like India and Bangladesh.
We urge both the government and private enterprises to take pro-active steps to attract maximum FDIs shifting to south Asia from China. Many countries will reap the benefits of the pandemic fallout, so why not us is our suggestion. If we succeed then it may help Bangladesh to recover from the present economic crisis in no time.