Despite boasting a half-trillion-dollar GDP and standing as South Asia’s second-largest economy, Bangladesh continues to underperform in attracting global capital.
According to the United Nations Conference on Trade and Development (Unctad) World Investment Report 2026, Bangladesh lags behind smaller African economies—such as Uganda, Ghana, and the Democratic Republic of the Congo (DRC)—in absolute Foreign Direct Investment (FDI) inflows, revealing persistent structural friction in the country's business ecosystem.
The report highlights a sharp paradox: while Bangladesh posted South Asia's fastest percentage growth in FDI for 2025, the total dollar amount remains far too small to support its long-term development goals.
In 2025, foreign direct investment into Bangladesh rose to $1.78 billion, up from $1.23 billion in 2024.
While this represents a significant 45% annual surge, a cross-regional comparison reveals the modest scale of this recovery.
Unctad notes that African nations successfully drew large-scale capital by unlocking major projects in energy, critical minerals, and large infrastructure.
In contrast, Bangladesh has struggled to attract similar large-scale foreign capital into its core manufacturing and service sectors.
The 45% percentage growth makes Bangladesh a regional frontrunner in statistics, yet its contribution to the broader economy remains limited.
FDI currently accounts for just 1.4% of Bangladesh's Gross Fixed Capital Formation (GFCF).
This data underscores that Bangladesh’s industrial growth remains almost entirely dependent on domestic financing, leaving the economy exposed to internal banking pressures and local liquidity credit crunches.
The greenfield slowdown
The most concerning indicator in the Unctad report is the decline in announced greenfield projects—investments where a parent company builds entirely new operational facilities and factories from scratch.
This contraction indicates that while existing foreign entities may be reinvesting their local earnings (reinvested earnings), entirely new global players are hesitant to enter the market.
How African peers outpaced Dhaka
According to Unctad, the success of Uganda, Ghana, and the DRC stems from aggressive, institutional regulatory overhauls designed to reduce business friction:
- Ghana’s Fiscal Strategy: Following a political transition in early 2025, Ghana eliminated several corporate taxes, stabilized foreign reserves through an active state-backed gold acquisition program, and lowered minimum capital barriers for foreign ventures.
- Uganda’s Administrative Single-Window: The country transformed its Investment Authority into a fully automated, functional One-Stop Service Center while providing targeted tax holidays in localized industrial parks.
- DRC’s Energy Liberalization: The DRC attracted large-scale investments by opening up its electricity grids and infrastructure pipelines to private foreign companies.
Meanwhile, outward FDI from Bangladesh to international markets saw a small increase, rising by 72.6% from $15 million in 2024 to $25 million in 2025.
The country's cumulative inward FDI stock wrapped up the year at $19.63 billion, a 9.9% increase year-on-year.
Globally, foreign direct investment rose 6% to $1.62 trillion in 2025, breaking a two-year decline.
However, Unctad warns that this recovery is highly concentrated, with the top 20 host countries drawing over 80% of all global capital. Investment flows are increasingly moving toward technology-intensive sectors:
- Digital Infrastructure & Data Centers
- Semiconductor Manufacturing Units
- AI Infrastructure
- Energy Transition Technology & Critical Minerals
The United States led global inflows at $277 billion, followed by Singapore ($151 billion), Hong Kong ($117 billion), and China ($105 billion).
The World Investment Report 2026 delivers a clear message to Dhaka’s economic planners: short-term percentage growth cannot mask structural limitations.
For a half-trillion-dollar economy, an annual inflow of $1.78 billion fails to reflect its true potential.
To successfully compete with agile economies across Asia and Africa, Bangladesh must move past short-term investment promotion.
Sustainable investment growth will require deep structural changes—such as removing administrative red tape, easing profit repatriation, improving logistics infrastructure, and providing reliable energy access.
Without these baseline reforms, Bangladesh risks remaining reliant on domestic capital, missing out on the technology transfers and high-wage jobs that global investment brings.
2025 FDI Inflows: Cross-Regional Comparison
Uganda: ──────────────────────────────────────────────────▶ $3.40bn
Ghana: ───────────────────────────────────────────────────▶ $1.90bn
DR Congo: ────────────────────────────────────────────────▶ $1.90bn
Bangladesh ($500bn+ GDP): ─────────────────────────────────▶ $1.78bn