Economists sing praises for AL's economic plan
Economists have termed the Awami League's projection of time-bound economic plans in its electoral manifesto a good sign and said it would hold the party accountable to the people.
They said it would also help time-to-time monitoring of the specific short- and long-term visionary plans the party has formulated focusing on economic targets.
The economic programmes incorporated in the AL election manifesto depend on financing and implementation strategy, they added.
On Friday, AL President Sheikh Hasina announced the manifesto with a target of taking the GDP growth to 8 percent by 2013 and bringing down poverty rate to 25 percent. The AL also pledges fixed time-bound specific targets for augmenting electricity production, increasing contribution of the industrial sector in the GDP and employment generation, among other economic issues.
Zahid Hossain, a senior economist with a multilateral donor organisation, said the target of growth and poverty reduction is achievable. But to implement it, either investment has to be increased or the existing production capacity in agriculture, industry and other sectors has to be augmented by using technological know-how.
He said during 1990-2000 average growth rate was 4.8 percent and poverty went down by 9 percentage points. The average growth rate was 5.4 percent during 2000-2005 while poverty rate fell by about 10 percentage points. As a result, if 8 percent growth is achieved in the next five years, the target of poverty reduction from existing 40 percent to 25 percent is possible.
The question is whether achieving 8 percent growth is possible. To achieve this target investment rate has to be increased to 30-32 percent from the existing 24 percent, which means the rate has to grow by 6-8 percent. Experience in investment shows it will not be very easy.
To achieve this the existing capacity has to be manipulated by using technological progress. For this emphasis has to be given on agriculture and industrial sectors, especially increasing agriculture production. And important issues that need to be addressed for that are seed, fertiliser and farming.
For all economic issues including power generation and creation of employment two things are very important: financing and policy framework. Zahid said it is a good sign that for the first time a political party has formulated specific short-term and long-term action programmes focusing on economic issues and global crisis.
Noted economist and Unnayan Samunnay Chairman Atiur Rahman said if political stability prevails and corruption and terrorism are checked, additional two percentage points GDP growth is possible. At present the average growth in the country is 6 percent.
If emphasis is given on agriculture and small and medium enterprise (SME), AL's target to achieve 8 percent growth is possible and it will not be impossible to bring down poverty rate to 25 percent in that case, he said.
If participatory budget system and e-governance are introduced and parliament is strengthened, the problem of financing can be solved. If good governance can be established, foreign funding would increase.
He also said if the local government system is strengthened, resource collection from local level would be possible.
Executive Director of Centre for Policy Dialogue Mustafizur Rahman said, "The positive side is that it has identified major challenges facing the economy both in short and medium terms and has set medium-term and five-year concrete goals in quantifiable terms."
He said the challenges would be to ensure adequate resources to achieve ambitious targets.
"However, from this perspective fiscal initiatives to mobilise domestic resources, domestic borrowing and foreign resources required are not detailed out. The targets for poverty alleviation with the potential GDP growth rates will require a major overhaul of the way growth is to be sustained and outputs to be distributed. This will need to be detailed out subsequently," he observed.
"The issues of regional disparity and income inequality will make achievements of targets set in the manifesto all the more challenging," he said.
Prof MA Taslim, chief executive of Bangladesh Foreign Trade Institute, also found implementation of the promises made in the manifesto would be tough given the existing level of resources.
"The real weakness of the manifesto is that it has not given any costing on how to realise these goals. A lot can be done if sufficient resources are there," he said, referring to issues like power generation, which would require increase in gas output or coal production.
Citing the thorny issue of coal mining that had brought grief to the previous BNP-led four-party alliance government, he said, "Whatever steps it takes it may be unpleasant for them."
Taslim however praised the plan to open seaports and develop deep-sea ports.
He was reluctant to give the next government credit for reducing commodity prices, arguing that the prices have already started to drop. "Prices have started to decline and it will go down further. Any government will enjoy its benefit," he said.
Taslim said 8 percent growth or more is attainable depending on appropriate policy support and proper infrastructure.
Economist and Economic Research Group Executive Director Sajjad Zohir said bringing down prices was supposed to be a widely claimed agenda but unfortunately not much thought is put into it.
"I will be happy to see political parties acknowledge the difficult times ahead for the global economy as well as the local economy; and the fact that prices are not generally in the control of the government," he said, adding, "Thus commitments are more credible if these are made in context of employment and on access to basic food to all at affordable prices or through safety nets."
Sajjad demanded a clear-cut commitment on how political parties would establish democracy amongst their members and what mechanism would ensure that the party members remain accountable to the people at large.
He said land and its mismanagement are widely acknowledged to be at the centre of many corrupt practices and the source of black money. "We had hoped that the manifesto would make commitments to use ICT in updating land records and easing land registration procedures to provide people of all classes relief from the wrong-doings of a few touts, officials and legal practitioners. I hope that the political parties will pay due attention to this area.”