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Asia Pacific Business Perspective - Assignment - HBI 560

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Swinburne University of Technology

   

Asia Pacific Business Perspective (HBI 560)

   

Added on  2020-03-02

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This document talks about FDI foreign direct investment by taking the example of Bangladesh, this report also shows the FDI inflows in the South Asian countries increased by 22 percent to $50 billion in 2015 out of which Bangladesh received $2.23 billion in investment.this developed international trading policy.

Asia Pacific Business Perspective - Assignment - HBI 560

   

Swinburne University of Technology

   

Asia Pacific Business Perspective (HBI 560)

   Added on 2020-03-02

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ASIA PACIFIC BUSINESS PERSPECTIVE 1Asia Pacific Business PerspectiveStudent’s NameCourse IDUniversityDate
Asia Pacific Business Perspective - Assignment - HBI 560_1
ASIA PACIFIC BUSINESS PERSPECTIVE 2In terms of growth in foreign direct investment (FDI), Bangladesh can be termed as one of the top countries among the South Asian economies. In 2015, Bangladesh economy witnessed a record growth of FDI reaching to a figure $2.3 billion (Ovi, 2016). Precisely, political stability in Bangladesh contributed the most for high growth of FDI. Furthermore, driven by the higher percentage of return on investment and low risk of investment are other reasons behind such inflow of FDI in the country (Ovi, 2017). According to the reports, the FDI inflows in the South Asian countries increased by 22 percent to $50 billion in 2015 out of which Bangladesh received $2.23 billion investment. Invariably, labour-intensive production industry in Bangladesh has been majorly benefited as the FDI inflows in the country increased by 44 percent in compared to $1.55 billion in 2014. In South Asia, Bangladesh is the second largest FDI recipient after India. Notably, India received $44 billion FDI inflows in 2015 (Ovi, 2016). The World Investment Report 2016 has confirmed how Bangladesh economy is becoming one of the leading emerging markets in the South Asia. In the developing Asian markets, Bangladesh has left Pakistan and Sri Lanka behind in terms of receiving FDI inflows as both the economies have recorded a decline in FDI inflows worth $865 million and $ 681 millionrespectively. In terms of international as well as Asia Pacific business perspective, the swing of FDI inflows towards the South Asian countries can be noted from the study (Bdnews24.com, 2017). Evidently, improvement in infrastructure in the energy and power sector in Bangladesh has drawn highest FDI worth $574 million. Besides, strong FDI inflows in the Asian markets have been a blessing for manufacturing exports as well. According to the reports, 5 manufacturing exporters in Asia have recorded a growth of as high as 18 percent growth in foreign direct investment inflow (Ovi, 2016). In the meanwhile, the increased inflows of FDI in
Asia Pacific Business Perspective - Assignment - HBI 560_2
ASIA PACIFIC BUSINESS PERSPECTIVE 3emerging Asian economies have signalled for the long-term growth of several industries (Samakal, 2017). The record number of FDI inflows in Bangladesh has been a positive sign for the economy itself. Due to FDI surge, manufacturing industry, oil, gas, and power generating industry, and other leading industries operating in the country can register substantial growth over the next few years (Rahman, 2016). Also, infrastructural development will create a number of private sector jobs in the economy. Therefore, the social position, as well as income status of the citizens of the country, will be enhanced. Apart from the social up-gradation, the political relation of the country with other Asian countries can be improved. However, the shift of FDIs inthe emerging Asian market can create business challenges for developed nations such as the US and Australia (Faruk, 2015). On the other hand, sluggish growth in demand in the commodity exporting economies such as Australia will face the major challenge as FDI inflows are shifting towards the South Asian countries. In the meanwhile, the improved economic status of emerging countries will increase cross-border mergers and acquisitions (M&A) influencing international investment policies.With rising FDI in Bangladesh, the international trade relation of the economy has developed in the recent years. According to Kabir (2016), the international trade relationship of Bangladesh has gradually improved in the last few years. Currently, textile and clothing has beena major exporting sector of the nation. Bangladesh has developed its relationship with China, Malaysia and India with its new international trade policies (Rahman, 2016). The subsidies and better opportunities provided to the international investors in terms of improved international trade policy has been the key factor leading to the increasing FDI in the nation.
Asia Pacific Business Perspective - Assignment - HBI 560_3

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