Bangladesh Lags Behind Ghana, Uganda in FDI Race

Bangladesh recorded significant growth in foreign direct investment (FDI) in 2025 but still lagged behind countries such as Uganda and Ghana in attracting overseas investment, according to the World Investment Report 2026 released Tuesday by the United Nations Conference on Trade and Development (UNCTAD).

The report said Bangladesh received $1.8 billion in FDI in 2025. During the same period, Uganda, Ghana, and the Democratic Republic of the Congo (DR Congo), all relatively smaller African economies, attracted more foreign investment than Bangladesh.

According to the report, Uganda received $3.4 billion in FDI in 2025, nearly double Bangladesh's total. Ghana and DR Congo each attracted $1.9 billion in foreign investment.

Despite having a market of more than 170 million people, a fast-growing economy, and a strategic geographic location, Bangladesh attracted only $1.8 billion in FDI.

The country's FDI inflows, however, increased by 45% from 2024, when Bangladesh received about $1.23 billion in foreign investment. Although this marked notable growth within South Asia, Bangladesh's position remains weak in the global competition for FDI.

UNCTAD also reported that the value of announced greenfield investment projects fell 22.9% in 2025 to $1.33 billion, down from $1.73 billion a year earlier.

Economists say the decline in foreign investment in new industrial projects raises concerns about future manufacturing capacity, employment, and export growth.

Mustafizur Rahman, distinguished fellow at the Center for Policy Dialogue (CPD), told Agamir Somoy that Bangladesh's FDI performance has remained disappointing for several years.

“We have been seeing a disappointing FDI situation in Bangladesh for quite some time. New FDI is even lower. A large share of the investment that is coming consists of the reinvestment of profits by existing companies. This situation must change. The Bangladesh Investment Development Authority (BIDA) is making considerable efforts,” he said.

The UNCTAD report also showed that foreign investment accounted for only 1.4% of Bangladesh's gross fixed capital formation (GFCF), indicating that the country's investment continues to rely heavily on domestic sources.

In contrast, Uganda, Ghana, and DR Congo attracted substantial foreign investment through large international projects in the mining, energy, and natural resources sectors, significantly boosting their FDI inflows.

Referring to the latest national budget, Rahman said the government had pledged to complete investment registration within 48 hours, issue licenses within one week, process visas within 10 days, implement a single-window system, and enforce the national logistics policy.

“Now the focus must be on implementing these measures properly. We face major challenges in quality infrastructure, gas supply, and electricity. That is one reason foreign investors remain reluctant to come,” he said.

He also stressed the need to fully implement the single-window system, which is currently only partially operational.

“Implementing the logistics policy, reducing the cost of doing business, shortening port lead times, and, above all, ensuring energy security would significantly improve Bangladesh's prospects for attracting foreign investment,” he said.

Rahman also recommended ensuring an adequate energy supply at competitive prices. He said resolving investors' complaints more efficiently is equally important, noting that dispute resolution in Bangladesh often takes many years and discourages potential investors.

Although political uncertainty has eased, other economic uncertainties remain, he said. He expressed hope that Bangladesh could attract much larger volumes of foreign investment if those challenges are addressed.

According to the UNCTAD report, the United States attracted the highest amount of FDI globally in 2025, receiving $277 billion. It was followed by Singapore with $151 billion, Hong Kong with $117 billion, China with $105 billion, and Brazil with $77 billion.