Decline in private sector credit, capital machinery import

FE Team | Published: November 10, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

Jasim Uddin Haroon
Many businessmen have withheld their business expansion plans for the time being. They have, apparently, adopted the 'wait and see policy.'
This is evident from the decline in capital machinery import and private sector credit in recent months.
The import of capital machinery needed for expanding business activities fell by 11.93 per cent during the first two months of the current fiscal over that of the corresponding period of the previous fiscal, Bangladesh Bank (BB) sources said.
According to the BB statistics, the import of capital machinery declined to $250.81 million during the period from $284.77 million during the same period of the previous fiscal.
In the meantime, private sector credit fell by 3.15 per cent in the fourth quarter of the fiscal 2007 over the same period in fiscal 2006, according to BB statistics.
The statistics also shows that the private sector credit disbursement by non-banks fell by 0.74 per cent during the fourth quarter ending June 30 of 2007 over that of the same period in fiscal year 2006.
Term loan disbursement by nationalised commercial banks fell by Tk 700 million in the fourth quarter of 2007. It was Tk 1.6 billion during the fourth fiscal in 2006 and it decreased to TK 0.9 billion in fiscal 2007.
However, different chamber leaders opined that many businessmen were watching the developments in the country keeping their expansion plans on hold.
"A good number of businessmen have decided not to make fresh investment for the time being as all are observing the country's political development," president of Chittagong Chamber of Commerce and Industry Saifuzzaman Chowdhury Javed told the FE.
In the meantime, some businessmen have volunteered to stay abroad.
Sources close to business circle claimed that around 200 businessmen were now on a long pleasure trips abroad with their family members.
One such entrepreneur while leaving for the Canada from the country told the FE that he now preferred to stay abroad and expressed his reluctance to invest for the time being.
"I do not feel like making new investment at the moment. I have decided to wait until the situation takes a shape," he said.
Chamber leaders said the government should constitute the 'Better Business Forum' and 'Truth Commission' immediately to restore business confidence and ensure the return of businessmen staying abroad.
While talking to the FE, President of Dhaka Chamber of Commerce and Industry (DCCI) said that the government should form 'Plea Bargaining Act' to bring back confidence of the businessmen.
President of Chittagong Chamber of Commerce and Industry (CCCI) said that the government should proceed in line with its announced road map for general election, voter's identity cards for restoring confidence of the businesses.
President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Anowar-ul-Alam Chowdhury Pervez told the FE that the government should set a timeframe for amnesty after the period none will be spared from penalties.