Restaurant sector hit hard by the crisis

The restaurant business has predictably taken a big hit due to the coronavirus outbreak as people have remained mostly locked in their homes during the past weeks. The sector was one of the first affected in Bangladesh as the number of customers started dwindling since late February, forcing businesses to either lay off or send home their employees without pay. 

The government has recently unveiled a plan to transfer Tk 2,000 in cash to 40 lakh families whose breadwinners have lost jobs because of the shutdown and it is believed that that includes workers from the hotel and restaurant sectors. However, it is likely that the amount is not enough. The number of food service establishments in the country is estimated to be around 60,000 where more than 15 lakh people are working. In Dhaka alone, there are approximately 10,000 restaurants that employ 3 lakh people, a huge percentage of whom are now unemployed. To support all these people and their families, the government will clearly need to increase the monetary value of the allotted relief package.

According to the general secretary of the Bangladesh Restaurant Owner's Association, a formal request from the authorities for a list of workers who should receive aid is yet to be made. It is important that the government acquires the list quickly having consulted with restaurant owners, as Ramadan and Eid are fast approaching and restaurant workers have been under substantial financial duress for some time now. The list is also important to ensure that no restaurant worker is left out and to guarantee that no one who is not a restaurant worker is able to take advantage of the situation and there is no misallocation of funds—as we have seen attempted already during this crisis in other sectors.

Finally, given that the current predicament may last a while longer, the government could consider exempting businesses from paying utility bills and the 15 percent VAT on rents for a few months at least to help them get back on their feet once it ends.