Bangladesh

Country risk

Country risk in Bangladesh is moderate to high. The OECD country credit grade is 5, indicating that there may be a moderate to high chance the country will be unable or unwilling to meet its external debt obligations.

Bangladesh is ranked 168 out of 190 countries in the World Bank’s latest ease of doing business survey, well below the regional average of 91. Bangladesh falls behind on all categories except protecting minority investors. Bangladesh is particularly weak in registering property and enforcing contracts.

The risk of expropriation in Bangladesh is high. The Foreign Investment Act of 1980 safeguards against government expropriation in Bangladesh without adequate compensation. But a weak judicial system and corruption can make it difficult for foreign investors to seek impartial arbitration.

Political risk is moderate to high in Bangladesh. The ruling Awami League’s overwhelming parliamentary majority and rivalry with opposition parties could contribute to ongoing political conflict. This political rivalry often results in local violence. Violence within political parties has also been a significant root of discord. In this regard, Worldwide Governance indicators show Bangladesh is well below the regional average for political stability and absence of violence, and lower on all other indicators of governance.