FDI surges in textile, clothing

Bangladesh’s textile and clothing sector experienced a surge in Foreign Direct Investment (FDI) in the last fiscal year (FY16), according to the latest statistics of the central bank.

Net inflow of FDI into the sector stood at $396 million in the last fiscal year, posting 11 per cent growth over FY15 when it was $351.62 million.

After registering a record inflow of FDI worth $445.82 million in FY14, a slump on foreign investment in the textile and clothing sector followed.

Bangladesh is the third largest apparel exporters in the world after China and European Union.

The South Asian country enjoys tariff-free market access in EU, Canada, Australia and other developed countries of the world except the United States.

The average tariff faced by clothes from Bangladesh in the US is 15 per cent.

Of the total foreign investment on textile and clothing in the last fiscal year, some $222.86 million was injected as reinvested earnings of the current companies operating in Bangladesh.

South Korean firms, mostly in the Export Processing Zones (EPZs), invested $111.61 million, almost one-third of the FDI, in the textile sector, followed by Hong Kong’s $89.07 million.