Does Foreign Direct Investment in Bangladesh: Opportunity or Threat to Economic Growth?

Author: Tasneem, Sara

Abstract:
Foreign direct investment plays a significant role to accelerate economic growth of Bangladesh. Foreign direct investment and economic growth are of vital importance for economic development. Economic growth unpretentiously determines the economic wellbeing of any country. Regardless of robust growth, Bangladesh has to struggle to gain foreign investment. Excessive dependence on FDI and preferential policy support for foreign investors may undermine the interest of domestic investors as well as economic growth in the long run. In this backdrop, the study aims to develop a model to show the adverse impact of FDI in the long run. Following the inductive reasoning approach with critical review of empirical literature and observation of macroeconomic phenomena, the study arrives at a model which explains and predicts how growth can be lower in the long run. It concludes with the recommendation of macroeconomic management, infrastructural development and moderate liberalization.

Keywords:Foreign Direct Investment, Economic Growth, Inductive Reasoning, Domestic Investment, the Model

DOI:

International Journal of Trade & Commerce (Vol: 9 Issue:2)