State minister for planning Shamsul Alam on Sunday said Bangladesh’s economy has discomfort, but there is no crisis yet.
Denying a section of economists' assumptions, he said the economy is on the right track; growth, production, and supply lines are working positively, while the government is trying to ease inflation by policy measures.
Alam said this at a discussion meeting on ‘New challenges in the economy of Bangladesh’ organized by the Economic Reporters’ Forum (ERF) at its auditorium in the capital on Sunday.
Chief Economist, Bangladesh Bank Md Habibur Rahman, Ahsan H. Mansur, Executive Director, Policy Research Institute (PRI), Mohammad Hatem, Executive President of BKMEA, Barrister Nihad Kabir, , Chairperson, Business Initiative Leading Development (BUILD), Abul Kashem Khan, director FBCCI, among other spoke at the event.
ERF president Sharmeen Rinvy presided the discussion meeting while its secretary general, SM Rashidul Islam, moderated the program.
The state minister also said some Bangladeshi economists were wrong in predicting that over 5 lakh people may die from Covid-19 pandemic unless a full lockdown was imposed across the country.
Despite this warning, the prime minister decided to keep open the factories, resulting in Bangladesh standing in the1st position in South Asia and 15th in the world in economic growth. If the government implemented a full lockdown in the factories, the economy of the country would have been in trouble, he said.
Import is declining, remittance, export and industrial growth are expanding in the country, defying the warning of a disaster of these sectors by the domestic economists, Dr Alam said.
The state minister said around 10 lakh workers went to different countries till June 2022. Ane despite huge imports, forex reserves still remained over USD $ 41 billion, so there is nothing to be worried about the economy.
BB chief economist Habibur said Bangladesh macroeconomics situation is under a little stress due to external effects, which are becoming stable by policy measures of the central bank.
The central bank will not increase the interest rate rather policy rate increases to make money management smooth, he said.
Meanwhile, the BB announced around Tk 1.0 lakh crore special loan packages for CMSMEs, SMEs, Agriculture and other specialized sectors to increase money flow in the market, said Dr Habibur.
He also assumed that exchange rate will back in stable position and then inflation rate will also become tolerable as it created for external effect, he said.
Ahsan Mansur said that another blow from the global recession will hit the domestic economy besides Russia-Ukraine war.
He suggested massive reform of the tax system including tax policies and strengthen domestic gas-coal extraction to make vibrant the domestic economy from the external effect.
Mohammad Hatem said huge tax burden is a barrier to growing business here it is not cooperative al all for Bangladesh entrepreneurs to compete with the global market.
If business grows, the revenue generation would grow, so government policy should aim to help business grow more. 0therwise pushing higher tax will hurt business, he pointed out.
He emphasized on uninterrupted energy supply in the knitwear sector for smooth production of export goods. If it does not happen, the fabrics import demand will increase which is not good for the economy.
Nihad Kabir said the government should act as facilitator, not regulator everywhere.
In case of raw materials for the pharmaceutical sector, an importer has to collect around 73 types of documents from Union Parishad to relevant ministries which are waste of time, she said.
For lack of automation a business requires around 35 types of documents to start and that is not business friendly at all. To create entrepreneurs, the government should reform policy, withdraw trade license requirements, make the easy business process to create young entrepreneurs, Nihad suggested.