Stimulus packages fall flat for implementation delays: ex-DCCI presidents
The government-announced stimulus packages failed to serve their purpose, which was to swiftly rejuvenate economic activities and protect jobs of millions, due to delays in their implementation, said leading businesspeople and an economist yesterday.
As a result, jobs continue to be lost, some 16 million so far, because of the coronavirus pandemic which has been severely affecting the economy.
The government announced stimulus packages amounting to more than Tk 103 lakh crore to help micro, small, medium and large enterprises face the fallouts of Covid-19.
However, most of the enterprises, especially the micro, cottage and small ones, are yet to avail money from the fund for utilisation during the pandemic to avert financial and job losses.
In some cases, the situation had turned so acute that entrepreneurs of the micro, cottage and small enterprises are even losing capital as their sales have declined significantly.
The image crisis created over a private hospital issuing fake coronavirus test certificates may have adverse impacts on the international trade of Bangladesh, said the businesspeople.
They said the Italian authorities sent back more than 100 Bangladeshis last week centring the falsification.
If something similar happens to involve businesspersons and any country sends them back, the image crisis would severely affect Bangladesh's international trade.
"So, we should do something immediately so that our image is brightened and rebuilt before the world and nobody falls victim to being told to return in any airport of the world," said Sabur Khan, a former president of the Dhaka Chamber of Commerce and Industry (DCCI).
"I also feel that this is the time to establish good governance," he told a virtual discussion on "Bi-annual economic state and future stance of Bangladesh economy: private sector perspective" organised by the DCCI.
Nine former DCCI presidents, an economistand Planning Minister MA Mannan participated at the event which was moderated by incumbent DCCI President Shams Mahmud.
Khan's views were echoed by Mannan.
"Unfortunately a few people have been damaging our image during this time of crisis as well as the time of rebounding," he said.
The minister cited the example of Vietnam, saying that the country has so far been successful in tackling the pandemic and safeguarding the economy with discipline.
He said the government was unable to disburse money from the social safety net programmes for many beneficiaries as they do not have bank or mobile financial service accounts.
Mannan suggested that businesspeople explore export potential of the Asian markets such as China, India, Japan, Sri Lanka and Nepal for increasing the country's trade.
"You can also do a lot of business even with Myanmar although there are some problems," the minister said.
He also highlighted the need for obtaining observer status in the Association of Southeast Asian Nations to expand trade with the member states.
Among the former DCCI presidents, Benjir Ahmed suggested that the government bring reforms in policies so that Chinese investment alongside work orders for the garment sector could quickly reach Bangladesh.
For instance, 21 types of permissions are needed for starting a garment factory in Bangladesh which is very discouraging for entrepreneurs, he said.
Ahmed suggested immediate implementation of the stimulus packages so that nobody ended up losing their jobs.
The Italian incident will have a negative impact on international trade of Bangladesh, said another former DCCI president, Sayeeful Islam. He also advocated for exploring opportunities in China.
Aftab Ul Islam suggested that entrepreneurs meet their financial needs from the capital market so that the pressure on the banking sector could reduce significantly.
If the entrepreneurs take money from the capital markets for investment rather than from the banking system, the percentage of nonperforming loans will also decline.
He also suggested that the government go for low cost borrowing from external sources to reduce dependence on the banking sector.
MH Rahman said the reduction in inflow of foreign remittance would usher a financial crisis which would affect the demand side of the consumers.
Decreasing demand will affect production in the factories and thus lead to unemployment. So Bangladesh needs to attract foreign direct investment from China now, he said.
Hossain Khaled, managing director of the Anwar Group of Industries, said borrowing past the predetermined target by the government from the banking system would affect the money flow to the private sector investors.
He also suggested that the government go for low cost borrowing from foreign sources to reduce pressure on the banking sector.
Abul Kasem Khan suggested that the government take measures to avoid a repetition of the return incident. Such incidents tarnish the image of the country, he said.
"Non-implementation of bailout packages is our collective failure and let us solve this issue collectively," he said.
Asif Ibrahim said the 11 per cent stock market capitalisation to GDP ratio of Bangladesh was the lowest among South Asian nations.
So the ratio of nonperforming loans is also high here, he said, adding that supplying money to the cottage, micro and small enterprises was a must if the country wanted to make the economy vibrant again.
Rashed Maksud Khan called for completing the construction of an effluent treatment plant at the new leather estate in Savar so that local exporters could get proper prices from foreign buyers from the sale of leather.
"We need to take measures to protect our overall employment as some 16 million people have already lost their jobs," said Masrur Reaz, chairman of Policy Exchange, a local think-tank.
It took seven years to revive the global economy after the recession of 2007 and 2008, he said.
Comments