Economic stagnation 'threatens to jeopardise country's achievements'

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FE Report
Economists and development practitioners have warned that economic stagnation threatens to jeopardise the country's achievement on the social front and urged the government to scale up public expenditure to bridge the gap created by declining private investments.
The quality fall in health and education, coupled with malfunctioning governance is also raising hurdles to the country's further economic leap, they have told a function marking the launch of a report on "Human Development in South Asia."
Speaking at the launching ceremony Monday, noted economist Wahiduddin Mahmud said the ongoing 'stagnation,' exacerbated by interim changes and global commodity price-hike is sure to deal a blow to the country's further advancement.
"Already, the economy is experiencing stagnation ... This may have a negative impact on the country's further advancement," Mahmud, who is chairman of Palli Karma Shahayak Foundation (PKSF), told the report launching ceremony in the city.
PKSF organised the discussion meeting on "Poverty in South Asia: Challenges and Responses" at its auditorium, marking the release of the 2006 report, prepared by The Mahbubul Huq Human Development Centre, Pakistan.
M Syeduzzaman, a former finance minister, gave an overview of the report on behalf of the Karachi-based research institute.
"We're now under the caretaker government. Even if it runs the country with honesty and efficiency, the ultimate good for the economy will hinge on how good is the next government," Mahmud said, stressing on policy predictability.
Mahmud, who also served as a caretaker adviser, said Bangladesh has managed to reduce its poverty and kept inequality at check over the years, but new problems -- especially rising food and fuel prices --have cropped up, delivering a blow to the economy, he pointed out.
"Prices of the country's major export item -- ready made garments -- have not increased, although those of imported goods have risen sharply, thus destroying the economy. And all these have damaging implications for the people," Mahmud, who also teaches economics at the Dhaka University, regretted.
Mahmud expressed the view that the pace of investment would usually slow down during what he called "major change," but said the void could be filled by enhancing public expenditures.