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Reform in the customs clearance procedure and visa regime is imperative to boost the inflow of foreign direct investment (FDI) into Bangladesh, Park Young-sik, South Korea's Ambassador to Bangladesh, said on Sunday.
He emphasised the urgent need for Bangladesh to undertake economic and policy reforms to attract higher levels of FDI, particularly in light of its impending graduation from least-developed country (LDC) status in 2026.
The envoy was speaking at a seminar on "Korea-Bangladesh Economic Cooperation," organised by the Foreign Investors' Chamber of Commerce and Industry (FICCI). Commerce Secretary Mahbubur Rahman was the chief guest at the event.
"Bangladesh must recognise that its economic structure, which protects domestic industries through high tariffs, should be reformed to open the market," Mr Park said.
"If domestic production costs remain higher than those of imported goods, foreign companies do not feel the real necessity to invest in Bangladesh."
Focusing on the impediments to FDI inflow, he said the government should improve the visa issuance scheme for foreign investors.
"If they encounter the stark reality of having to renew their visas every three months, they will question whether they still want to stay in the country."
He also mentioned that most foreign investors have pinpointed customs clearance as one of the biggest challenges to investing in Bangladesh.
"The complex, delayed, and often inconsistent customs processes in Bangladesh lead to unnecessary cost increases and delays in trade," he said.
He added that issues such as arbitrary procedural delays and lack of transparency in customs clearance undermine investor confidence and hinder the smooth flow of goods.
Looking ahead to Bangladesh's post-LDC trajectory, Mr Park highlighted that while the country has made commendable progress - with per capita income having tripled over the past decade - sustaining this growth will require a shift in focus from quantity to quality.
"Economic growth must be driven by innovation, knowledge, and technology - areas where foreign companies can make a significant contribution," he noted.
Despite this potential, the envoy pointed out that Bangladesh's FDI-to-GDP ratio remains significantly lower than that of regional peers, standing at just 0.75 per cent compared to India's 1.7 per cent and Vietnam's 4.7 per cent.
He stressed that improving the business environment is essential to bridging this gap.
On bilateral relations, the ambassador reiterated Korea's long-standing commitment to Bangladesh, particularly through its role in developing the country's readymade garment (RMG) sector over the past five decades.
He highlighted recent expansions into manufacturing and infrastructure as signs of deepening economic engagement.
Ambassador Park also expressed optimism about the proposed Korea-Bangladesh Economic Partnership Agreement (EPA), noting that negotiations are underway.
"If concluded, this EPA will significantly enhance bilateral trade and investment in ways that benefit both nations," he stated, adding that Korea has no strategic motives beyond economic cooperation.
Concluding his remarks, the ambassador expressed strong hope that the bilateral EPA would become a "motor engine" for elevating the Korea-Bangladesh partnership over the next fifty years, just as the RMG sector did in the last half-century.
He closed by thanking FICCI for its active role in fostering bilateral economic ties.
mirmostafiz@yahoo.com