Internet outage: What message did foreign investors get?

The recent internet blackout for a week has left a big dent on the image of the country among the international community, especially investors and buyers.
Moreover, two days after getting access to social media platforms such as Facebook, TikTok and YouTube on July 31, users again faced difficulties in accessing accounts as the authorities asked mobile phone operators to enforce a restriction, which undermined reliability.
Though mobile internet users were able to regain access to their Facebook and Messenger accounts nearly six hours later, the imposition of such restrictions is giving out a negative signal.
Businesses and analysts said no investor prefers pouring funds into a country where they may face a condition that leaves them unable to communicate with stakeholders.
Buyers of garment products also think in this way. If transportation in the country remains suspended for weeks and they cannot communicate with the factories, they will face difficulties in getting products on time.
Platforms providing services of freelancers also think along the same lines.
When there are adequate options to invest in other countries or buy products from other countries, it is natural to refrain from taking the risk of pouring funds into Bangladesh or placing work orders with the factories in the South Asian country.
According to analysts, the internet shutdown was a clear suicidal decision considering the impact it has on the economy. With that, the government was trying to blind people so that they cannot see what was happening around the country.
However, these types of steps usually backfire and create a bad image among the people.
This tendency was also seen in the stock market when the floor price was used for a couple of years to halt the fall of the market index amidst economic pressure in the country.
Ultimately, it has a negative impact on investors and the index dropped when the floor price was eventually withdrawn.
If the government tries to cover up or hide the reality, the scenario gets exposed by a massive proportion once the barrier is removed.
So, the government should not intervene in hiding the reality and instead work for bringing peace to the country and stability to the economy.
Mamun Rashid, an economic analyst and a former veteran banker, said business process outsourcing (BPO) is a very competitive market while Bangladesh’s young generation was acquiring the market nicely.
“The government’s support also helped the outsourcing sector. But the recent internet blackout spooked the industry very badly,” he said.
This industry needs regular involvement of people so any disruption to the internet hits the activities and it impacts the buyers, he said.
Many of the service providers had to immediately go to neighbouring countries to continue their activities so that buyers do not get to feel the impact of the internet blackout, he said.
If the buyers observe that the internet disruption occurs frequently, the work order can be diverted to other countries, he said.
An exporter informed that his buyer already diverted around 40 percent of import orders to other countries like Cambodia and Indonesia, he said.
If the internet service in Bangladesh is tagged with the word “unpredictable”, many other buyers also will turn away to other countries, he added.
A top official of a leading LEED-certified garment factory, preferring anonymity, said he earned a reputation for shipping products timely by putting in the effort for years.
But the recent instability had impacted his shipping. Although his factory was closed for several days during the curfew mid-July, he had to send products through air shipments which is costly, he said.
On the other hand, he fears that the situation in the country may deteriorate further, which would hamper their activities further. If it continues, the buyers will turn to other options, he said.
“Why will they place orders with us when they have enough options in many other countries?” he asked.
Garment buyers were not affected that much by the social media shutdown on Friday because it did not disrupt their communication. But this was nothing positive for them, he said.
So, the government should work with the protesters to stabilise the situation as early as possible. Otherwise, the garment sector will be impacted, which may negatively impact the economy, which is already under stress, he added.