Bangladesh Bank has given permission to four local companies; BSRM, Square Pharmaceuticals, Reneta and Columbia Garments to invest in five foreign countries.
The four companies have received new permission to invest $13.5 million (Tk 116 crore) abroad.
The permission was given at a meeting of the review committee on investment of Bangladeshi companies abroad on Wednesday, Md Serajul Islam, spokesperson and executive director of Bangladesh Bank, said on Thursday.
BD Venture's application was rejected in the meeting while the application of Sonargaon Seed Crushing of Meghna Group has been asked for further review.
Although many Bangladeshi companies are interested in investing abroad, there has been no policy so far.
The government last week issued new rules on foreign investment. However, Bangladesh Bank has been giving permission to a few exporting companies on a case-by-case basis for a long time.
A committee comprising various government agencies headed by Bangladesh Bank has so far allowed a total of 17 companies to invest abroad.
Among them, Mobile Jamuna has returned the investment of Myanmar in 2019.
The committee had the last meeting on Wednesday. Now anyone who wants to invest abroad has to apply in the light of the new rules.
The Central Bank officials said that Square Pharmaceuticals has received permission to invest $1 million in the Philippines. Columbia Garments has been allowed to invest $1.5 million in Hong Kong.
Steel company BSRM has been allowed to invest $5 million in Hong Kong. Renata has been allowed to invest $5 million in the UK and $1 million in Ireland.
Renata Company currently has investments in Ireland and in the UK. Now they are allowed to raise capital.
BSRM and Square Pharmaceuticals also have investments in Kenya.
BSRM was allowed to invest $4.67 million in Kenya in 2016. In the same year, Square Pharma was allowed to invest $12 million in Kenya.
Meghna Group's Sonargaon Seed Crushing was on the list of applicants at Wednesday's meeting. The company applied for a $25,000 investment in Singapore. However, the company does not have its own Export Retention Quota Account (ERQ) account for various reasons, including further review.
In addition, the application of BD Ventures has been rejected as it has no foreign exchange earnings.
This information will be conveyed to the concerned institution soon by letter with the permission of the Governor of Bangladesh Bank Fazle Kabir, a Central Bank official said.
According to the new foreign investment policy, if a new person is interested in investing abroad, he/she has to apply in the light of the new rules.
In this case, an exporter can apply for the conditional investment of less than 20 percent of his 5 year average annual export income or 25 percent of net assets whichever is less.
Only homogenous businesses can be sought for investment abroad. In this case you have to apply through the foreign exchange trading bank along with the required documents to the foreign exchange investment department of the central bank.
After preliminary scrutiny from the concerned department, it will be sent to a 15-member high-level selection committee headed by the Governor for final approval. If approved there, investment can be made abroad.
The investment must be made in a country from which there are no restrictions on repatriation.
However, investments cannot be made in countries against which the United Nations, the European Union, and the Office of Foreign Asset Control have sanctions on repatriation.
