With the onset of lethal coronovarius, the business world we knew appeared to have disappeared-as if it was washed away in a devastating Tsunami. And it is not just the world of business, but also literally everything else got affected in one way or another, ranging from losses of human lives and from dramatic changes in the daily lifestyle of people to the purchasing behaviour of consumers. For quite some time, the economies and the lives around the world have been going through an unimaginably distressful state-something the world perhaps witnessed a century ago.
This is a big challenge to take on, for every economy around the world, and not just Bangladesh. But just like a ray of light in the darkest of times, there are new opportunities even in the Covid times. Look at the sales of masks, soaps, hand sanitizers, protective gear, etc., these are going really well, as well as the digital businesses. On the other hand, many businesses have gone down the slope. The businesses handling the pandemic in the smartest possible way are the ones getting back on their feet faster than their peers who failed to do so.
Now, let's consider the case of Bangladesh. Ours is an economy heavily dependent on export business and overseas remittances. And the major destinations of our merchandise exports are Europe and America, especially North America. North America has been severely affected by coronavirus resulting in more infected patients and higher death rates than in Bangladesh so far, and the same can be said about Europe. And so, an exporting country like Bangladesh was delivered a heavy blow.
We have managed to normalise the Covid challenges to a tolerable state, and accepted it as a 'new normal'. The infections have yet to abate, but not as deadly as in the initial times. Except for the old aged persons or patients with underlying medical conditions, all are taking medications and treatments at their home, and they are recovering. And our economy has been recovering from the initial Covid shocks. This was possible, thanks to the quick measures taken by the government such as providing the stimulus packages to the apparel sector and other industries, as well as providing loans as working capital. The megaprojects have picked up pace again. Our macro-economy is getting a good shape now. In addition, the reserves are also growing increasingly, which is at this moment US$41 billion. The recent news such as IMF's prediction regarding Bangladesh surpassing India in per capita GDP will inject fresh momentum into the country's economy. Bangladesh is in a better position than its South Asian counterparts in various economic indices. The government overcame the challenges the nation faced, and so did the common people.
A gleam of hope is that the rural areas are almost free of Covid infections and fear, where more than 80 per cent of the country's population live. People have been continuing to live there normally even in Covid times. But the crop harvesting has taken a hit due to the flood situation, which may result in spending some foreign currency from the reserves to import rice or other crops required. But this is not something to be worried about much, as the next harvest season will put an end to this temporary hiccup. Our garment sector has resumed its business, although besides the knit operations, the woven has not gained the pace yet, but soon will, as orders are coming in, same goes for the textiles sector.
Another looming concern is the second wave of coronavirus. We are already seeing cities in Europe going into lockdown again due to the surge in virus cases again. If both Europe and America face dire situation like this again, then we may be in trouble once more. There will be no other way than to reshape the economy of Bangladesh. But hopefully, if this does not happen, then we can pass the time really well with a promising future.
The unemployment rate has gone slightly up, the purchasing capability has gone down and people have been avoiding luxury products. But good thing is, the sector responsible for around 84 per cent of the country's total export-or the garment sector of Bangladesh-has always been producing and exporting apparels for low and middle-class people, and not luxury products. During Covid times, the demand for this type of products has gone up, but not much for the fancy products, as people are more prone to staying at home and avoiding big social gatherings; be it in this country or abroad, the knit products are being worn in homely environment. The woven industry, on the other hand, needs some time to stand up.
Something to look forward to is the vaccine of coronavirus; all the countries in the world are looking for one and they are lining up. Research has been going around and hopefully we shall soon get a vaccine, which does the job well. But when it is dropping by no one knows, perhaps in the first quarter of 2021 as per the WHO's projection. Who will get these vaccines is another question to ponder. But as a third world country, Bangladesh will be ahead on the list, which can be presumed. The availability of vaccine will depend on the flow of supply, and also on the price. Besides, after getting the vaccine, who will be first to get- that's something the government will decide, perhaps the elderly and the vulnerable groups will be prioritised while getting a jab. Also, the news of a vaccine being developed and at the trial stage here in Bangladesh is something that gives us a glimpse of a better future in biomedical technology, and also of a rekindled hope. All of these are post-Covid thoughts though.
But it's not plausible that the whole world will be vaccinated soon and then all on a sudden everyone will go back to the pre-pandemic lifestyle. Many of the businesses will take time to get on their feet. All the countries and the people should spend wisely during the pandemic. Austerity should be exercised until the economy gets back to normal. The unemployed people need to be taken care of. The remittance-warriors, who returned home during these challenging times, need to be sent back- this is another challenge. My suggestion is the government should take a step back from sending out the unskilled labourers to Middle East, rather focus on establishing more vocational institutes and train the people before sending out. The number of private universities getting licences to operate is too high, and due to the low standards of the education, the students graduating from there do not meet the criteria set by the companies for an entry level job; this is true as we take so many interviews and can evaluate the performance. So instead of this, setting up of more vocational institutes should be encouraged so that they can acquire right kind of technical know-how and expertise. If skilled manpower can be produced, they will be able to perform better not just at home, but abroad, resulting in increased remittance for the country, and their social status will see a rise too. The whole education sector needs to be reshaped, and automatically this will help solve the unemployment problem. Our people working in foreign missions need to come forward to deal with the overseas migration issue with utmost priority and sincerity.
Another issue worth addressing is the decline of the multilateral agreements of the World Trade Organisation (WTO). Day by day, the countries are no longer honouring the agreements. Rather, they are more inclined to the bilateral agreements. So, we need to determine which countries we should get into agreement with in future to reap more benefits for our country, and this is really high time we studied that. As multilateral agreements days are nearly over, more countries have progressed by opting for bilateral deals- Sri Lanka has, India has, so should we. As we can see, the trade war is raging, we are seeing rising discontent with China's economy and factories are shifting out of China; so, if we are not re-evaluating our economic strategy then we will lose any upper hand we have in the global market. The agreement signing procedures need to be totally hassle-free, so that any foreign emissary can visit our country and can sign a bilateral agreement quickly, as does Vietnam or Thailand. The government is thinking about it, but this needs to be executed very soon, and the news needs to be well publicised and our overseas missions need to be involved in this. Our economic zones should be ready with proper utility support such as consistent and uninterrupted electricity, LNG gas, central ETP, water, strong infrastructure, etc.
If our economic zones are fully ready to operate, then the possibility of getting investment from Japan, Hong Kong, Korea, Taiwan, etc. goes high. We can even receive investment from Europe as they are facing trouble running textiles factories over there; hence the potential for shifting to Bangladesh looks promising.
With the proper measures taken, Bangladesh can leave the dark days behind and rise towards a bright future. We can hope that one day, the pandemic will be a thing of the past and a memory to take lesson from.
The writer is the Chairman of Envoy Group and Sheltech Group. [email protected]
© 2023 - All Rights with The Financial Express