Bangladesh needs to ‘close the deal’ to attract more US investment: US ambassador

There is a lot of optimism and interest among US investors regarding Bangladesh, but there are a few areas that need to be addressed first, US Ambassador to Bangladesh Peter Haas said.

During a visit to The Business Standard premises on Monday, the ambassador also sat for an interview with TBS Editor Inam Ahmed, where he elaborated on a number of issues including attracting US investment, the de-dollarisation conversations, Rohingya issue and the complexity of acquiring US student visas.

America is the biggest investor in Bangladesh. But in this changed global landscape, what can Bangladesh do to attract even more US investment?

I was just in Washington last week and also met with the executive board of the US-Bangladesh Business Council. There is unbelievable optimism and interest in looking at Bangladesh as an investment destination for people coming for the first time or the possibility of increasing investment in Bangladesh and so people are looking at Bangladesh. They see the growth rates, the tens of millions of people brought out of poverty and the increasing middle class. So, there is a lot of excitement.

Photo: TBS

But people don't just wake up in the morning and think they're going to invest in Bangladesh; they wake up and say I need to invest in some place overseas. And then they look at Bangladesh, Vietnam, India, they look at your competitors frankly. Then they start comparing: Where is the best investment climate, where can I get products in and out most quickly, where are the best transportation linkages, what the supply chains look like, can I move my money in and out quickly, will I be paid…so it's all of those questions that as Bangladesh is seeking to attract more investment needs to look at.

They need to look at not only their own progress – which has been remarkable – but how do they stack up against competitors and it'll be more important as it graduates from the LDC status to a middle-income status but American companies are definitely looking at Bangladesh as you said we are the largest foreign direct investor here and i think that'll continue…it's just a matter of closing the deal.

Due to the growing tension between the US and China, many companies have shifted away from China. Do you think Bangladesh can be one of the coveted places for US companies to invest?

Absolutely, I think the entire world saw after Covid what happens when you are overly-reliant on a single country for manufacturing and the need to diversify supply chains. So, in the event of something catastrophic like Covid you have multiple places you are supplying yourself from. Bangladesh is certainly one of the countries that people will look at. Even during Covid, we saw Bangladesh stepping up and playing a role in PPE and in other things that we needed for Covid but then going further I can imagine all kinds of possibilities in Bangladesh either in high-end textiles or pharmaceuticals. Again, it is just a matter of Bangladesh creating the environment where companies say, "I am going to invest there."

In terms of textiles, we used to enjoy duty-free access to the US market, which was suspended in 2013. Now, Bangladesh has stopped the compulsory fumigation of US cotton. The RMG owners think this is a ground to demand GSP back. How do you respond to that?

There's a couple of things there. One is, GSP has never ever covered RMG or textile, it was never a part. And second, although we are very close on cotton fumigation, it is still not a done deal – we are still waiting for one final agreement by the government of Bangladesh, which we think will come. It will be a great advantage for US cotton exporters, who have the best cotton in the world.

I have been in conversations, I met with BGMEA yesterday, so I know that Bangladesh WOULD like to be able import US cotton, manufacture textiles and re-export it to the United States duty-free. One of the things that I have been encouraging Bangladesh is that it requires an actual change in US law, which in any democracy – getting a change in law – is never easy. But what I have talked to Bangladesh about is really starting to work with our Congress in figuring out how to get that law changed. Then again, the amazing thing is that we are still the largest market for Bangladesh exports so it's done a remarkable job in remaining very, very competitive in our market.

A number of countries are shifting away from the dollar in their foreign trade. How do you look at this de-dollarisation thing?

I think it's important to look at the difference between how much people are talking about de-dollarisation and moving towards other currencies relative to how feasible it is and how many are actually doing it. So, in general, and Bangladesh sees this – if you say spend more dollars than you earn in exports, you run a deficit and you have problems with reserves. The same would happen with Yuan or any other currency. Bangladesh imports far more from China than it exports. So, there would be a shortage of Yuan to settle their debts.

The second thing to look at is internationally what is the most recognised currency. Which currency would you most like to have in your pocket at any time? Which country do you think has the most stable financial system, the most independent central bank and kind of what you can rely on long term. This is just like crypto. The talk of people replacing the dollar with crypto a few years ago…I think this is some of the same here and the dollar will remain important in the foreseeable future.

One of the fallouts of the Russia-Ukraine war is the impact on poorer countries, like Bangladesh. We are suffering from the high price of fuel. You have the sanction on import of oil from Russia, but India is doing it. Can't Bangladesh? The US also said it would help poorer countries access Russian oil. What is happening there?

First of all, let me praise Sheikh Hasina and the joint statement during her visit to Japan where she clearly stated that Russia's invasion of Ukraine was illegal and in violation of international norms set by the United Nations. Secondly, she called for respecting the sovereignty and the territorial integrity of Ukraine. I think that is really important as a starting point for all of these conversations that this started off due to Russia's illegal invasion of Ukraine and that Russia could end it at any moment.

The second point is that we have never had sanctions and do not have sanctions on oil, gas, fertilizer and agriculture. Those do not exist. It's not easy to get Russian oil, but there are no sanctions in place.

And third, the other thing we have done, working with G7 countries, is we have coordinated with those countries, including India, that are importing Russian oil to set a minimum price or maximum price ceiling that they will pay. So, yes they are still buying Russian oil, but they are paying far less than the market price. When they are able to refine it and re-export it, it still remains at a price below the market place. We have spent a lot of time thinking about how not to impact the rest of the world because of Russia's illegal invasion of Ukraine.

Recently, a delegation of Rohingya and Bangladesh government officials visited Myanmar to determine whether the conditions for repatriation were right. This was part of the China-backed repatriation of Rohingyas. How do you look at it?

I'd like to start with an acknowledgement of Bangladesh's generosity over these past almost six years. Nobody expected when Bangladesh opened its heart and borders to the Rohingya that they would still be here this much later. The United States is by far the largest donor to this effort, at $2.1 billion and everyone's ultimate goal is repatriation. I'm seeing press reports as well about the possible discussions between China, Myanmar and Bangladesh. But the one thing I would say is that it is really important that the United Nations, UNHCR and the largest donors like the United States, are consulted and are actually part of these conversations. Based on what I see in Myanmar, the conditions are not ripe for refugees to return…they need to return to a place where they are safe, have a dignified existence, have documents and citizenships and don't have to fear another round of genocide. So, I think it is really important to keep repatriation – and it is the ultimate goal – but to have a very clear-eyed approach to it when the time is right.

Lots of Bangladeshi students go to the US for studies. But the visa process is a hassle and there is a huge backlog at the embassy. What are you doing to ease the situation?

There are a couple of myths out there. One is the question of Visas and the second is the question of affordability. We have something called the EducationUSA to educate people about studying in the United States and the reality is there is a lot of scholarship money. As a result, the number of Bangladeshis studying in the US is the fastest growing of any country in the world. It is the 13th largest group now…there is still some room to grow there. We really encourage it and are making every effort to ensure that every Bangladeshi, who has been accepted by a US university, will have an interview in time to start classes if they are qualified. In the past year, we had many Bangladeshis applying for US student visas, more than ever before. What we do is we started a series of what we call Super Fridays, where we bring consular staff on Fridays and all they do is interview students. This is to make sure they can get the decision to join their classes on time.

On the election front, is the US working as a mediator to bring the BNP – the largest party – to the election?

Simply put: no. We are not working as a mediator. That is not our job or responsibility. It's no secret that we call for free and fair elections here in Bangladesh and are looking at ways we can help Sheikh Hasina and her stated desire to have free and fair elections…but bringing in a political party into the equation is not something we do. Ultimately, it is up to each political party to make its own decision on whether or not it wants to participate in the election. I assume that part of that decision is whether or not they think they can participate in the elections and be confident that if they get more votes than any other party, they can form a government. So, it is not our role but we hope those are the kind of elections that will take place where everyone is confident that the will of the Bangladesh people will be respected.