Planning Minister AHM Mustafa Kamal is frequently hogging headlines these days. Of course, it is normal that any politician and more so if he/she happens to be an important minister, would like to do so.
Last Wednesday (May 16) the minister made a sudden announcement that from now on the Bangladesh Bureau of Statistics (BBS) would release inflation data in each quarter - and not in each month as it has been doing for ages. Indeed, it is an important change and the professional economists, who use it most, were taken by surprise.
It is a major decision that will have a big impact on the functioning of the national economy. The minister is a professional accountant and also a successful businessman. He should be knowing of the impact and implications of his decision.
Practising economists are highly critical of the decision of the Planning Minister. Ahsan H. Mansur, Executive Director of Policy Research Institute (PRI), has described the decision as "pathetic."
The BBS produces the inflation data by collecting information from the field through a mechanism that reflects changes in the prices of a basket of goods and services. Interestingly, the decision to switch from monthly to quarterly publication of CPI (Consumer Price Index) data has been made when the prices are tending to rise, largely because of the rising prices of rice.
The minister, however, told the media that BBS would continue to bring out the monthly inflation data. He then added, "but I will not sign the file - I will not officially acknowledge it." Then comes the punch line: "The decision was taken because the BBS cannot properly capture the monthly changes in CPI timely." This means BBS will continue to collect and publish the monthly data and based on these data the quarterly CPI data would be calculated and made available officially with the minister's signature.
PRI's Mansur disagrees with the minister and points out that CPI data is supposed to be released weekly instead of monthly. Many countries, including India, China and the US, release their CPI data weekly.
Mansur is also highly critical of the practice of approving and signing the inflation data by the planning minister. This, he points out, could be misconstrued as politicisation of basic economic data.
The World Bank's Dhaka-based lead economist Zahid Hussain, while disagreeing with the minister's decision, has suggested instead to announce a CPI release calendar as is done in India, Sri Lanka and the United States, among other countries.
Dhaka University's economics professor Selim Raihan has advised the government to arrange release of quarterly GDP (gross domestic product) figures instead of quarterly inflation data.
sayed.kamaluddin@gmail.com
