The business environment in Bangladesh has further deteriorated, according to a survey report.
The Business Climate Index (BBX) survey for the financial year 2023-24 showed the score at 58.75 in fiscal year 2023-24, down from 61.95 in the FY2022-23.
Metropolitan Chamber of Commerce and Industry (MCCI) and research institute Policy Exchange Bangladesh (PEB) have conducted BBX survey for the third time. The report of the survey was released on Thursday at MCCI's Gulshan office.
BBX 2023-2024 is the third iteration of Bangladesh’s first home-grown index that gauges the country’s business climate.
This time the country's business environment index dropped at 58.75 from 61.95 in the previous fiscal year. That is 3.2 percentage points decreased in one year.
The survey covered 12 sectors—agriculture and forestry, construction, electronics and light engineering, financial intermediaries, food and beverages, leather and tannery, pharmaceuticals and chemicals, housing, ready-made garments, textiles, transportation, retail and wholesale trade.
MCCI president Kamran T Rahman presided over the event. He said, this survey has been done to understand the overall business environment of the country. This survey gives an idea about what kind of policy needs to be adopted in any sector. Policy makers and investors will also understand which way they should go.
In his keynote presentation, Dr. M. Masrur Reaz, Chairman and CEO, PEB, mentioned that during 2023-2024, the BBX score has dropped to 58.75 from last year’s 61.95, showing that significant efforts are needed to address business environment challenges.
“There were improvements in three pillars coupled with drops in seven pillars. Rajshahi was the best performing region while Barisal came last. To unlock the country’s potential, he emphasized improving infrastructure and logistics, strengthening financial systems, enhancing legal and regulatory frameworks, bolstering institutional governance,” he pointed out.
A dialogue was held between Zaved Akhtar, President, FICCI, and Yuji Ando, Country Representative, JETRO. Ando welcomed this latest BBX report and pointed out that 62 percent of Japanese companies operating in Bangladesh were expecting to expand as per a survey.
Akhtar emphasized the credibility, capability, and consistency of policies and simplification of customs, tax, and VAT frameworks in Bangladesh.
In the open forum, topics that came up for discussion include different ways of improving the pillar scores in the future and the need to focus more on improving access to finance, ease of paying taxes, and policy stability.
The overall business environment index score for the fiscal year 2021-22 was 61.01 out of 100. In the next year FY 2022-23, that score increased marginally to 61.95. The main reason for the lack of significant improvement in index means that 4 out of 10 indicators worsened and the remaining 6 indicators were improving.
Like 2022, Bangladesh has done the best in infrastructure sector in 2023 as well. The score on this index is 71.08 out of 100. In addition, the business start index is 62.74; 53.11 in land availability index; 68.04 in the access to information index; 70.04 in labor control; 62.38 in dispute resolution; 60.87 on trade facilitation; 54.74 in tax payment; 63.50 in technology adoption and 51.59 in environmental control.
Salman Fazlur Rahman, Private Industry and Investment Adviser to the Prime Minister and Lokman Hossain Miah, Executive Chairman (Senior Secretary), Bangladesh Investment Development Authority (BIDA) were also present in the event.