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Organized by:The Daily Observer & DBC

Dialogue on: How the economy is doing

Published : Thursday, 12 March, 2020 at 12:00 AM  Count : 749
Dr. Saleh Uddin Ahmed Former BB Governor

Dr. Saleh Uddin Ahmed Former BB Governor

Former Governor of Bangladesh Bank (BB) Dr. Saleh Uddin Ahmed commended the present state of the country's economy despite some lapses.
He, however, expressed his worries on the future status of the Bangladesh economy, which is being challenged in its banking sector riddled with non performing loans and non compliance of policies of the Bangladesh Bank (BB) and the World Bank.
Highlighting the progress on the implementation of mega projects in the country he said equal distribution of the national wealth and income among the people is also important to reach the fruit of development to all.
He said one thing the government should be aware that it never be trapped by the illusion of becoming a developed country without strengthening capabilities of the country.

Rakibur Rahman DSE Director

Rakibur Rahman DSE Director

Dhaka Stock Exchange (DSE) Director Rakibur Rahman said the key note speaker has only highlighted the development side of the economy, but it is not       all. He said banks were openly looted and stock market is facing similar backlash. Big borrowers are not returning money to banks and liquidity crisis in banks has seriously reduced their investment in    the stock market.  
 He said, if banks are not well stock market will not be well. Stock market has plunged in recent time as banks were not making enough investment. It appears there is none to put a brake to bring normalcy in banks and stocks.
He blamed private banks for lavishly donating to the government fund and taking undue benefit. This is impacting the stock market.   




Fazle Fahim FBCCI President

Fazle Fahim FBCCI President

The Federation of Chamber of Commerce and Industries (FBCCI) President Sheikh Fazle Fahim said there has been a lot of criticism about the 9 per cent interest rate against loans set by the Bangladesh Bank.  He deplored many people who once pleaded for the 9 per cent interest rate are now criticising it.
"Constructive criticism is good, but it is not good to say something for the sake of saying something. 99.99 per cent of the businesses in Bangladesh are happy about the 9 per cent lending rate," he added.
The Finance Ministry has taken many initiatives to reduce non performing loan (NPL) and the FBCCI is giving all support to the Ministry.
If the SME sector is not internationalized then it will be difficult to meet the challenges in the future and to increase product diversification is very important, he added.  
He said some policies need to be taken to reform the banking sector and to diversify of financial instruments.  



Mohammad Arafat Chairman Suchinta Foundation

Mohammad Arafat Chairman Suchinta Foundation

Suchinta Foundation Chairman Mohammad Arafat said an economy has always ups and downs. Someone will say it is not well others may say it is going well. "I must say it is on average well," while most criticism is unfounded, he observed. He said it is true that economic disparity and income gap is growing; rich people are getting richer. But the poor are also becoming well off.
He said in a fast growing economy with the pace of development the gap between the rich and the poor will be disproportionately growing. But looking at the poverty reduction scale Bangladesh has walked a lot out of the poverty line. The impressive change is noticeable inside and outside the country. "I am not worried about growing discrimination," he said.



Dr Mustafizur Rahman Distinguished Fellow, CPD

Dr Mustafizur Rahman Distinguished Fellow, CPD

Distinguished Fellow of Centre for Policy Dialogue (CPD) Dr Mustafizur Rahman  said to continue the existing per capita growth GDP should increase. He said as Bangladesh is on process to graduate to a developing country, it is now necessary to think about the government's financial strength, employment generation, private sector credit and quality of gross domestics product.
He said the government should concentrate on higher export growth, revenue earnings and increase private sector credit growth. He added attracting more local and foreign direct investments is another urgent matter at this moment.
He said it is important that the government should take concrete steps towards good governance, strong institutions, rule of law, transparency and accountability, enhanced productivity and efficiency gains, structural transformation of economy, decentralization of economy, efficiency in public expenditure allocation and better public sector management.



Dr. Habibur Rahman BB Executive Director

Dr. Habibur Rahman BB Executive Director

Bangladesh Bank (BB) Executive Director and Chief Economist Dr. Habibur Rahman said with the current economic growth of 8.2 per cent Bangladesh is a star performer in the world, despite various problems.
The growth trajectory moving from 1.7 percent to 4.6 percent took several decades and it hovered at 6 percent for near a decade and in the last fiscal year the growth crossed 8 percent.
Dr. Habibur Rahman said during the last decade poverty and extreme poverty reduced significantly and distribution of national  income was handled efficiently reducing inequality.
He said the living standard of the lower tier improved significantly as the inflation was largely reined in and the exchange rate was maintained at a tolerable level by Bagladesh Bank monitoring.



Mohammad Nurul Amin Former president, ABB

Mohammad Nurul Amin Former president, ABB

Former President of Association of Banks (ABB) Mohammad Nurul Amin was critical on fixed lending rate of banks at 9 percent. He said there is no competition - the same rate for all borrowers irrespective of their net worth - banks will lose dynamism in their business operation.           
He said banks get 75 percent income from interest on loans. Now if banks income fall the government revenue from large tax payers banks will also fall and banks activities only shrink.
He viewed positively of the Bank Company Amendment Act saying there are some good points but questions remains whether it can be implemented. He also spoke positively for setting up of a Banking Commision saying the central bank must see reforms in many areas and its empowerment should also be increased.



Dr Ahsan H Mansour Chairman, Brac Bank

Dr Ahsan H Mansour Chairman, Brac Bank

Executive Director of the Policy Research Institute of Bangladesh (PRI) and Chairman of Brac Bank Dr Ahsan H Mansour said the economy of the country is good now but there is a doubt about the future.
He highlighted the weaknesses in investment, banking sector and revenue collection. “I am concerned regarding the sustainability of our economic growth because of Bangladesh's poor tax-GDP ratio," he added.
"As per our sixth five-year plan, the target was to increase our tax-GDP ratio to 15 percent. But instead of going up, the ratio has dropped below 9 percent. India and China's tax-GDP ratio is 18 percent and 30 percent respectively, according to the latest data." Sluggish investment, low revenue growth and the weak banking sector are the three major challenges confronting the economy, he said.
He said the banking sector has default loans reaching 23 to 24 percent.




Golam Rahman President, CAB

Golam Rahman President, CAB

President of Consumers Association of Bangladesh (CAB) Golam Rahman said Bangabandhu has tried throughout his life to bring smile on the face of poor workers, laborers and helpless farmers. His able daughter is now practically implementing those dreams.
He said Bangladesh is now on the highway of development but it is also widening the economic   disparity and income gap among social groups.
He was highly critical on recent increase of tariff for water and electricity which is pushing the cost of living of the people.




Kamal Uddin Director The Daily Observer

Kamal Uddin Director The Daily Observer

The Daily Observer Director Kamal Uddin said to maintain the upward trend in the overseas trade Bangladesh should take steps so that in the wake of coronavirus outbreak the country's overseas tarde is not affected,
He said Bangladesh procures some 60 per cent of its total imports from China and due to the coronavirus out break the imports, mainly of industrial raw materials are seriously hampered.
If the import chains are not restored or the country fails to get some alternative of Chinese sources the situation may become serious, RMG sector leader Kamal said.








Dr Saima Haque Bidisha Prof. of Economics, DU

Dr Saima Haque Bidisha Prof. of Economics, DU

Professor of Economics of Dhaka University Dr Salma Haque Bidisha said that the economy must take lessons from the past to face newer challenges.
She said for the 4th industrial revolution the government must take decisive steps to create skilled manpower to overcome higher productivity challenges.
She said "the country must ensure that economic growth must be inclusive and its benefit must  reach to all." But she said she didn't see credible steps to reduce economic discrimination and income gap which she said is growing.




Pervez Tomal Chairman NRBC Bank Ltd

Pervez Tomal Chairman NRBC Bank Ltd

NRBC Bank Chairman Pervez Tomal said expansion of industrialization needs infrastructural development. Investments increases based on improved infrastructure facilities. So also if remittance is to increase, the government must take appropriate steps for human resource development. He said with the development of skilled manpower, remittance will increase. He was critical of lower allocation for research demanding more funds in this respect. It must be sector-wise and also committees should be setup accordingly to get the results.
Pervez said the government has given permission to many banks in the private sector but most of them are lacking corporate governance.



Aftabul Islam Ex AmCham President

Aftabul Islam Ex AmCham President

Former AmCham President Aftabul Islam said Bangladesh Bank needs more independence as it can't work freely on intervention from        many quarters and in most cases private banks ignore its directives adding  greater irregularities in the banking sector. He held three factors responsible for it.
Aftabul Islam who is now Director of Bangladesh Bank said that a rise in the number of family members on the board of directors of private banks- up to four at the moment- is highly disturbing and secondly their longer tenure in office is also distorting banking. And thirdly defaulters are defying repayment of the loan taking cover of law suits in the courts. There must be a change in the system and the government must play the appropriate role in solving these problems.
He said Bangladesh Bank must be further strengthened so that it can take decisive actions against errant bank and borrowers.
He said the government’s recent default loan recovery package paying 2 percent down payment of the principal has made so far no major impact in loan recovery process. The government must take drastic move if it wants to recover default loans.



Mozammel Babu Chief Editor, Ekattor TV

Mozammel Babu Chief Editor, Ekattor TV

Ekattor TV Chief Editor Mozammel Babu said the size of the economy has increased manifolds from what it was ten years back. Its     indicators also increased. He demanded appropriate steps to keep the momentum of the economic growth saying it can only push the country's economic development to grow further.
He said the 21st century is a millennium for the country to achieve higher prosperity and growth. The government has already taken many measures to bring the country to the height of growth and for this more needs to be done. We must continue the trend. The government is working to achieve these goals, he said.
On stock market development, he said the government has taken many steps for the development of the stock market. But it is not growing in normal way. He demanded to identify who are the people behind the scam and how they are manipulating the market.  
In my opinion if digitalization of the market can be implemented, much of the problems will be over. Digitalization may resolve the problem to large extent, he said.




Dr Jamal Uddin Ahmed Chairman, Janata Bank

Dr Jamal Uddin Ahmed Chairman, Janata Bank

Janata Bank Chairman Dr. Jamal Uddin Ahmed said our growth is a significant achievement that already made known Bangladesh as the second largest readymade garment exporting country in the world. The country has used low cost human resource, favorable weather and geographical location to achieve the feat.
But, he however lamented the existing financial sector's faulty structure is ruining the entire sector and impacting every other sector of the economy.
Mr Ahmed suggested to redesign the whole financial structure. He said the government should reduce    its dependent on banking and added that the country's development highway can't alone dependent on banking, it can't be the only source of funding.



Dr Naznin Ahmed Sr Research Fellow, BIDS

Dr Naznin Ahmed Sr Research Fellow, BIDS

Research Fellow of BIDS Dr. Naznin Ahmed laid emphasis on devaluation of taka against dollar pointing to the need for closely looking at  whether the current exchange rate is to the country's best interest at a time when the decline in exports, mainly garment exports is worrying the nation.  She wonders if the SMES will be disadvantaged under the new single digit interest. She  questioned whether the newly introduced 9 percent interest on industrial lending will consider lower rate for SMEs loan or treat them on equal footing.
Naznin said more young women are now entering the SMEs sector and if the nation wants to derive this demographic dividend, SME funding must be strengthened.




Masihul Huq Chowdhury MD, Community Bank

Masihul Huq Chowdhury MD, Community Bank

Community Bank Managing Director and CEO Masihul Huq Chowdhury praised the significant development in the country's agricultural sector. He said    productivity in agriculture has tremendously increased to make the country self sufficiency in food while it has also reduced at the same time the dependence on agriculture as part of the GDP. This is a good development achieved in past years.
But ours is an economy still at low cost at low efficiency which can't go. Bangladesh should increase human resource development for which more investment is needed for skill development and training the country's youths. The country should be able to bring more development financial institutions and a functional bond market need to be created for long term investment in mega projects.



Mostafa Kamal Chairman Meghna Group

Mostafa Kamal Chairman Meghna Group

Meghna Group Chairman Mostafa Kamal said at this moment, due to higher cost of loans from local banks, we have to seek foreign currency loan through local banks if approved by the Bangladesh Investment Development Authority (BIDA).
Foreign loans are arranged mainly for power sector and export based industries, he said.
He said despite reduction of complicated paper works after degitalisation the problem still persists in many cases for getting approval for new products and industries.



Iqbal Sobhan Chowdhury Editor, Daily Observer Chairman, DBC News

Iqbal Sobhan Chowdhury Editor, Daily Observer Chairman, DBC News

The Daily Observer Editor and DBC News Chairman Iqbal Sobhan Chowdhury in his introductory speech invited speakers to vent their views on the present state of the country's economy which is always directly related with the politics.
As the political stability has been largely persistent in the country over the decade under PM Sheikh Hasina and  if the economic growth continues the people will be getting the real benefits of the independence which we attained under the leadership of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman he said.



M Shahidul Ahsan Chairman, Ahsan Group

M Shahidul Ahsan Chairman, Ahsan Group

Ahsan Group Chairman M Shahidul Ahsan said Coronavirus outbreak is causing uncertainty to businesses, in particular the agro-based       industry producing feed meals is severely affected with its major source of raw materials in China.  He said raw materials stocks of most agro-based manufacturing companies are running out while new imports has slowed down due to coronavirus impacts. The industry is not in a position to continue import and a slow productivity is already impacting the production line.
He demanded that the government should come to extend support to this sector to overcome the negative impact on productivity and marketing chain. He said the government can assess the losses the industry is currently incurring across the country and urged the finance ministry to sit with stake holders and listen to their concerns.  


Fahmida Khatun Executive Director, Centre for Policy Dialogue (CPD)

Fahmida Khatun Executive Director, Centre for Policy Dialogue (CPD)

Executive Director of Centre for Policy Dialogue (CPD) Fahmida Khatun said economic benefits must be distributed among all people. Currently despite a robust growth    there is disparity in annual earnings and therefore more new employment opportunities need to be created for income generation which is now faltering.  
She said an inclusive participation is imperative in the development process. Otherwise growing income disparity will further widen the income gap between the rich and the poor.
The CPD executive director said social benefits must be available for low income people for sustaining economic growth. Fahmida said the government's project cost always rises and has become a regular phenomena of cost escalation for development projects every year. It occurs from slow implementation of development projects in a process lacking transparency and accountability.
She said there should be good governance in the government to sustain the development and achieve accelerated growth. She said corruption, inefficiency and a lack of foresight are generally the reasons for project cost rise, nobody is ever held responsible for this. This is unacceptable.



Mir Nasir Hossain Former FBCCI President

Mir Nasir Hossain Former FBCCI President

Former President of FBCCI Mir Nasir Hossain said coronavirus may hit in the country's industrial sector as most of the raw material in the oven sector of the country comes from China.
He said, 70 percent raw materials of the readymade garment (RMG) sector come from China. He said: "The FBCCI has proposed to the Finance Ministry to take up measures with a work plan to reduce adverse affect of corovavirus.
"I hope the government will take necessary steps, otherwise the country will face a big crisis and the coronavirus is expanding every day."
As a result, the danger can be compounded if the situation gets worse in the days ahead. This requires a discussion under the leadership of the Prime Minister. Do it quickly, he said.



Md Manzurul Islam CEO, DBC News

Md Manzurul Islam CEO, DBC News

DBC News CEO Mohammad Manzurul Islam gave vote of thanks expressing his gratitude to the distinguished guests   made the seminar a success.
He said that DBC News and The Daily Observer will organize more dialogues in Mujib Year.


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