To survive the financial crunch brought along by the coronavirus pandemic, the Advertising Agencies Association of Bangladesh (AAAB) has demanded immediate payment of arrears being withheld by government agencies. The organisation also asked the government to facilitate loans at two per cent interest to keep businesses afloat.
Ramendu Majumdar, president of the organisation, made the demands at a virtual press conference on Tuesday. AAAB Advisor and former Cultural Affairs Minister Asaduzzaman Noor, AAAB General Secretary Munir Ahmed Khan and other members were present at the briefing.
Majumdar said 80 per cent of media revenues come from advertising agencies. But they are yet to receive outstanding bills from many ministries, government and semi-government organisations.
"As a result, advertising companies are not being able to pay bills to newspapers, televisions and radio channels. This has created a crisis throughout organisations and the media," he added.
He demanded government guidance to pay the arrears soon for resolution. Besides, advertising agencies will have to be included in the package announced by the government and will have to be given loans at two per cent interest.
There are around 18,000 people working in this sector. Not only those who make or manage advertisements, but people from event management and other sectors are also directly involved in the industry, Ramendu said, adding that there has been no income since the end of March, but costs continue to pile up.
He said they gave a memorandum to the prime minister on May 13, seeking cooperation of the government.
AAAB put forth four demands to overcome this crisis: stop deducting income tax at source, clear the outstanding bills, give loan facilities at two per cent interest for three years, and recognise the advertising industry as a necessary service sector.
"We are requesting the loan facility to meet 70 per cent of our expenses for one year. The agencies will repay the loan in three years. Interest will have to be introduced six months after taking the loan."
Elaborating on the business situation, he added that information provided by various agencies shows that 70 per cent of the business plan for 2020 could not be achieved.
Usually, from January to March, there is a business downturn. Business improves during the two new year celebrations and the last two-three months of the year. But this time, there was no business on Bengali New Year and Eid-ul-Fitr, and Eid-ul-Azha will be the same.
Although economic activities remain stalled since March, house rents and all other expenses are still being incurred. Paying workers is now a big challenge, and money that could have been received from various organisations has also been cut off. As a result, there is a huge pressure on working capital. Such stress is difficult to handle, Ramendu said.
Asaduzzaman Noor said, "We did not ask the government for help just for us."
Newspaper and television advertisements have decreased. In some organisations, the advertising division has collapsed. Government assistance is needed to survive, he added.
"If the government does not help, many institutions will close, and a lot of people will lose their jobs. We don't want to lose our long-time colleagues," Asaduzzaman said.
Munir Ahmed Khan said advertising agencies never went to the government for help; they have taken care of themselves. "Now, we need some help to survive."
Members of AAAB's executive council Sanaul Arefin and Syed Gousul Alam also spoke.
According to AAAB, the organisation was formed in 1978. The association represents all major advertising agencies in the country.