Creating congenial business environment

Saleh Akram | Published: October 16, 2015 00:00:00 | Updated: November 30, 2024 06:01:00

Business fosters development in as much as total business volume contributes to national income. Economic stability of a country is dependent on steady national income and the volume of business transacted. As global competitiveness report for 2015-16 has revealed, Bangladesh has gone up 29 positions higher than the preceding year in macroeconomic stability. In infrastructure, its position went up by four steps, from 127 to 123 and market size went up by an equal margin from 44 to 40. The country achieved these successes despite negative trends in the world economy. However, it gained an extra advantage as two countries which were above it were not included on technical ground. It has been maintaining a steady growth rate of 6.0 per cent.
But there are areas that lack the ingredients of a sound business environment. Exports are increasing and inflation is under control. But development in infrastructure which is one of the main drivers of economic growth is far below the level necessary to boost business growth. Clearly the infrastructure sector is to be developed to bolster growth in trade and industry. Â
Good governance and organisational efficiency are two areas that will have to be established to ensure a credible business environment. Bangladesh is actually nowhere near the desired level in these two areas and in fact, it is among the last ten in the list.
The education sector is progressing but the standard of education in all levels leaves a lot to be desired. The United Nations has also stressed on the standard of education in its sustainable development goals (SDGs). The country will have to increase investment for quality higher education. Skilled manpower is essential for business development. It is not possible to have skilled manpower without higher education and training. Â
Similarly, special attention will have to be given to IT. Although the number of mobile phone users has risen to 130 millions and use of internet is increasing, wider use of IT in economic activities is not noticeable as Bangladesh is lagging behind in e-based transactions and adoption of web-based business model.
Other tasks involve improving the efficiency of the financial sector and technological efficiency of the market. The size of the internal market is expanding, which is considered by businessmen as a formidable power. A sizeable buyer community is there at home. But financial sector lacks efficiency.
The rate of interest against loan for investment is the highest in south Asia and needs to be reduced to lower the project cost and operational expenses to allow products to enjoy a competitive advantage.
Linking business with education is also an important tool for development. Foreign investment is not forthcoming, technology transfer is not taking place at a desired pace. Health sector should be developed. The number of hospitals is increasing but standard of service is not. Greater contribution is required from sectors like education and health if Bangladesh has to move to higher middle income status from lower middle income category.
Apart from inadequate infrastructure, corruption and inefficient bureaucracy are the main stumbling blocks towards investment, vis-Ã -vis development of trade and industry. In addition, a section of our businessmen having close links with the government is having a good time. But the majority of businessmen do not enjoy the same facility. They have to withstand competition from local manufacturers as well as imported products. They also have to compete in the world market. Distinction between businessmen with close links with the government and those without should be removed to keep the wheels of development on the right track. In this way, small traders and farmers can also derive benefit and if we can ensure it, we shall be able to reach our goal for higher middle income status in the not-too-distant future.
saleh.akram26@gmail.com