Bangladesh Bank Governor Dr Salehuddin Ahmed has called for building economy on domestic resources rather than only the external factors to face the global financial crisis.
"We cannot just depend only our exports. We have to look at sectors like small and medium enterprises and agriculture, which is the mainstay of Bangladesh," he said while addressing a roundtable at the auditorium of Bangladesh Institute of International and Strategic Studies (BIISS) in the city.
BIISS organised the roundtable styled 'The Global Economic Crisis: Impact on Bangladesh'.
Speaking as chief guest, Dr. Ahmed said the internal issues should get priority rather than just depending on external factors in the wake of global meltdown.
"We need quick responses. We need to take short-and-long-term measures in this regard," he added.
The central bank governor thinks the country has to wait until March to feel the real impact of the crisis when the data of the first quarter of current year is available.
He said: "We have to be self-sufficient. We have to diversify our exports."
The country's remittance inflow is still in a comfortable level, said Dr Ahmed dismissing the concern of a slowdown.
AKM Atiqur Rahman, professor of Department of Economics at North South University, presenting his keynote paper said that export growth might slow down if the recession persists and the protectionism in developed countries grows.
"Apart from this, on the negative side, remittance growth may melt down and tax revenue growth may slow down," he said.
On the positive sides, Mr Rahman said, balance of payment may not be affected that much because of sluggish import growth.
He said: "Declining food prices in the global market and appreciation of Bangladeshi Taka also may help the poor by reducing domestic food price that may have a positive impact on poverty."
"However, prolonged recession may also increase unemployment if export sector is hurt severely with negative impact on poverty," he added.
But the university professor said the exact magnitude of change and the impact on the economy depends on how long the global recession sustains and the interplay of negative and positive factors emanated from the recent change of global economy.
He said growth impact on Gross Domestic Product (GDP) may be anywhere in between very insignificant as perceived by the Bangladesh Bank or a decline by 2.0 percentage points (from the national target of 6.5 per cent) as projected by the World Bank.
Abu Belal Muhammad Shafiqul Huq, director general of BIISS, said global economy has changed drastically in 2008 and the country's foreign aid inflow, remittance and foreign trade may be affected because of those changes.
"The manpower industry of Bangladesh might be hurt as the Middle Eastern countries, which host over 60 per cent of the country's around seven million migrant workers, have been hard hit by global financial crisis and a slide in oil prices," he said.
Professor Mohammad Ali Taslim, executive director and chief executive officer of Bangladesh Foreign Trade Institute (BFTI), said readymade garment sector, which accounts for three-fourth of the country's total export earnings, might be boosted as people from the recession-hit developed countries have switched to low-cost items.
"We must be alert as the demand for low-priced products may fall once their income increases," he said.
Annisul Huq, president of Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said they can look at the financial crisis either negatively or positively.
He said: "Bidding price for order is falling substantially, and we are lagging behind when it comes to competition."
The business leader said the government should be ready to extend assistance to the business sectors of the country.
Dr. Mustafizur Rahman, executive director of Centre for Policy Dialogue (CPD), said the country has to get ready to stave off possible impacts of the recession and utilise the opportunities it might create.
"The recession has created new export destinations like Japan for us. We have to fully utilise the scope," he said.
He said 1.6 million workers were expected to go abroad this year. "But the number might fall to only 0.4 million amid slowing demand, which means around 1.0 million people will need job in the country."
The number of migrant workers from Bangladesh hit a record high of 0.87 million in 2008, up from 0.83 million a year ago
Professor Muzaffar Ahmad, chairman of Transparency International Bangladesh, while moderating the roundtable said they (western countries) have fallen victim to capitalism.
"We cannot look at only financial institutions. We have to look at the whole economy," said Prof. Ahmad, also a member of Board of Governors of BIISS.
