Like many developing countries across the world, Bangladesh has been hit hard by the pandemic and the Russia-Ukraine conflict. Compared to many of its neighbours however, the South Asian nation was able to handle the first, and still ongoing, public health crisis quite well.
So far, the country has fully vaccinated more than 120 million people. It also managed to secure 3.45% economic growth during the peak of the pandemic while many others experienced negative growth.
The fact that recovery was well underway was clear when Bangladesh secured 6.94% growth and received US$ 3.44 billion foreign direct investment in 2021-22 fiscal year. The FDI received represented a 37% year-on-year growth.
A number of social security schemes were launched to protect the most marginalised of society, while businesses (both small and large) received various economic stimulus packages. In total, 28 financial and incentive packages were implemented with a budget of more than US$18 billion. The packages benefited 73 million people and 172,000 organisations.
But the consequences of the second crisis, the Russia-Ukraine conflict hit Bangladesh harder, and led to sharp widening of the country's current account deficit, a decline in its foreign exchange reserves, among others.
However, if Bangladesh is one thing, its resilient. The economic indicators have started to look up in recent weeks. The main sources of Bangladesh’s foreign earnings are its garments exports and earnings sent home by migrant workers.
In November, Bangladesh exported goods worth more than US$5 billion, a monthly record, and earned US$ 1.59 billion from remittances, up by 4.5% from October. The first quarter of 2022-23 FY also saw FDI inflow increase to $1.16 billion, a 28% Y-o-Y rise.
According to the Boston Consulting Group, despite the gloomy global economic climate, the demonstrated resilience of Bangladesh and the measures it is taking should allow it to remain on course to become a trillion dollar economy by 2040, and the ninth largest consumer market globally by 2030.
However, given the uncertainty surrounding global developments, the pressure on the balance of payment is likely to continue. As a result, Bangladesh preemptively approached the International Monetary Fund (IMF) and has since reached a preliminary agreement for a US$ 4.5 billion financing. The preemptive nature of the loan distinguishes it somewhat from both Pakistan and Sri Lanka.
Read more: Experts at CPD dialogue want long-term measures to avoid macroeconomic crisis
Rather than assist the government with constructive criticisms and suggestions, as is expected of responsible opposition parties during a crisis, the Bangladesh Nationalist Party (BNP), the main rival of the ruling Awami League, chose this issue to launch their electoral push. And that too, using despicable means.
At the height of the economic crisis in Sri Lanka, BNP, and their key ally, the Islamist Jamaat-E-Islami, launched a coordinated online disinformation campaign that Bangladesh would be the next Sri Lanka by failing on its debt repayment obligations. This was echoed by their senior leaders too. Suffice it to say, no respectable economist and/or analyst supported that conclusion.
In fact, the chatter became so loud that the IMF itself had to clarify that Bangladesh is not in a Sri Lanka-like situation. They noted that while Bangladesh's reserves have declined, they were still high enough to cover 4-5 months of prospective imports. They also pointed out that the debt outlook is expected to remain sustainable as the country has a low risk of debt distress. The public sector debt to GDP ratio stands around 6%, with the external debt to GDP ratio being 14%, well within the safe thresholds.
In the last few months, BNP and their allies have orchestrated at least two other coordinated online disinformation campaigns. One involved spreading misinformation that banks are facing a liquidity crisis, and the other involved lying to expatriate workers that their hard earned incomes would be lost if they used official banking channels to send home remittances.
The fact that these campaigns were not fringe, and did cause panic among expatriates and bank depositors, was demonstrated when the central bank had to issue separate back-to-back statements giving assurances about the safety of both remitted incomes and consumer deposits.
Like its economy, Bangladesh’s politics too, has been making international headlines recently. In particular, much has been said and written about the BNP's December 10 rally in Dhaka, where they presented certain demands in the run up to the next national elections.
Read more: Economy has unease, but no crisis: Shamsul Alam
Looking solely at the international media coverage, one could be forgiven to think that a massive Iran-like anti-government protest just took place at Dhaka. In reality, Dhaka is no Tehran, and the rally was not a spontaneous outburst by the people.
The rally was the tenth such one by BNP in a span of a couple of months, as part of its push in the run up to the next election. Not an uncommon, let alone unique, phenomenon in Bangladesh. As far as crowd sizes go, in Bangladesh's context, the few thousands who attended did not even constitute anything numerically special, let alone spectacular.
In the last few weeks, Prime Minister Sheikh Hasina's own party, the Awami League, organised several mass political events. At least two of these saw a turnout of a million each.
While the international coverage did mention the clashes which took place between police and activists on December 7, arrests of BNP leaders, and the large security presence on December 10, they did not even fleetingly refer to the reasons or context. On December 7, the police recovered 15 crude bombs from the central office of BNP in Naya Paltan. The clashes, the resulting raid at the BNP office, and arrests only took place after party activists tried to block a busy city street without prior authorisation, and threw handmade bombs on the police from their office rooftop.
The global media also failed to mention that BNP’s central leaders like Amanullah Aman and Shahiduddin Chowdhury Any had been announcing, completely illegally and unconstitutionally, that from December 10 onwards, Bangladesh would be run upon the diktats of Tarique Rahman and Khaleda Zia, thereby further increasing the heightened security sensitivity regarding BNP’s Dhaka rally.
Read more: IMF loan would help economy gain stability in reserves, dollar market: Experts
Since December 10, it has been made clear that BNP’s principal demand (also also that of Jamaat) is the reinstatement of the caretaker government system, which was abolished in 2011 after the Supreme Court ruled that the system is “void and ultra vires the constitution”. The Awami League also objects to the system in principle given its abuse by BNP in 2006 and by the military from 2007-08.
Despite the seemingly irreconcilable differences on the caretaker government issue, the people of Bangladesh are hoping that both political camps can find the heart to resolve the outstanding issues without any violent confrontation.
In the coming months, BNP has signaled to intensify their movement to realise their demands. While the government has a legal duty to respect the opposition's freedoms of assembly and speech, the opposition also has a duty to keep their activities peaceful.
This is important given the terrible human and economic costs suffered by Bangladesh the last time BNP and their allies went for an all-out oust-government movement in late 2013 and early 2014. Hundreds were killed, and thousands were burnt, during BNP-Jamaat’s indiscriminate firebombing campaigns.
While the government alone shoulders the positive responsibility of managing the economy, the opposition, at the very least, has a negative duty not to disrupt the wheels of the economy (for instance by intentionally spreading misinformation).
Moreover, both the government and the opposition must share the burden of maintaining political stability in Bangladesh. Otherwise, the country may not be able to hold on to its hard-earned gains, and navigate the current murky global economic waters successfully.
The author is a lawyer, researcher, and political activist. He is currently working as a senior political associate at the Centre for Research and Information (CRI), a Dhaka-based think-tank. Previously, he served as a special aide to the Bangladesh Prime Minister.