Any trade sanction to hit economy hard
Any trade sanction on Bangladesh from the West would significantly impact the economy, said the noted economist Wahiduddin Mahmud yesterday.
With foreign exchange reserves at a precarious position, any obstacles to the country's exports, which are mainly headed to the West, would be injurious to the economy, he said in a view exchange event of the Newspaper Owners' Association of Bangladesh (Noab).
"Sanctions on some individuals and institutions are not a big deal for the economy. But, if any trade sanction comes, it will impact the economy significantly," he added.
Bangladesh's economic crisis is not a full-blown crisis yet, said Ahsan H Mansur, executive director of Policy Research Institute.
When the balance of payments crisis was in a moderate stage, the government needed to make some policy decisions but it was not interested.
"For instance, the government was not interested in devaluing the local currency even though the situation demanded it. The market forces finally compelled them to take that step," he added.
Some people are blaming external issues for the present economic situation, but internal issues are the main factors, said Salehuddin Ahmed, a former central bank governor.
Regarding the problems in the banking sector, Ahmed said the governor is not the only one responsible for that state.
"The issue of governance is to blame but that is common in the whole country," he added.
The government is not taking evidence-based policies, so many of their plans are not working out, said Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue.
As a result, Bangladesh's GDP is growing, but the export-to-GDP ratio and the revenue-to-GDP ratio are going in the other direction, he added.
Inflation spiralled in Bangladesh due to the wrong policies of the government, said Rashed Al Mahmud Titumir, chairman of the University of Dhaka's department of development studies.
The government is taking loans from the government and printing money, both of which are fuelling the inflationary pressure, he added.
The government is taking loans in foreign currency but it has no concrete plan on how the funds would be utilised and how the amounts would be paid back to the lenders, said Mushtaq Khan, professor of economics at the UK's SOAS University.
"If this continues, you are bound to default once."
The power plants were established at a high cost and those will be a big burden for the economy, he added.
NOAB President AK Azad presided over the meeting held at the Pan Pacific Sonargaon. Mahfuz Anam, editor and publisher of The Daily Star; Matiur Rahman, editor of Prothom Alo; Shamsul Huq Zahid, editor of Financial Express; Dewan Hanif Mahmud, editor of Bonik Barta; and Mozammel Haque, editor and publisher of the daily Karotoa, were also present.