Taskforce meets tomorrow to draw plan on stimulus fund spending

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FHM Humayan Kabir
The government-formed high-powered taskforce on global recession monitoring would sit tomorrow (Wednesday) to assess the impact of the global economic meltdown on the country's economy and suggest possible financial support to weather the fallouts, officials said Monday.
The committee, formed in March last, will meet for the second time as the country's economy, especially the major export-oriented sectors, has been hard hit by the second round impact of the latest global economic gloom.
Finance ministry officials said the high-powered committee, headed by Finance Minister AMA Muhith, will look for ways and means of utilising the stimulus packages, announced in the budget, for betterment of the country's worst-affected sectors.
"The meeting may recommend a possible stimulus package for some worst-affected sectors to cushion them from the impact of the global financial dip," a finance ministry official told the FE.
The meeting of the taskforce is scheduled to be held in the Planning Commission conference room in the city.
The government has allocated Tk 50 billion (5,000 crore) in the current national budget to support the country's recession-hit sectors, especially the export-oriented industries.
Frozen food, the second largest export earning sector, leather, jute, home textile, drugs, vegetables and woven garments already felt the pinch of the recession as the shipments in July dropped to large extent.
Though the exports from the woven and knitwear sector maintained a positive growth ranging between 14.5 per cent and 16.21 per cent in the last fiscal, the earnings dropped in July, the very first month of the current financial year.
Export of woven garments recorded a negative growth of 4.66 per cent and knitwear a positive growth of 1.77 per cent in July last.
In the last fiscal year, the country's total exports accounted for US $15.57 billion to post a growth of 10.31 per cent.
Md. Fazlul Hoque, president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), told the FE that month-to-month knitwear shipments had been plunging since the second half of the Fiscal Year 2009 under the impact of the global recession.
"It could slow down further in the coming months and many factories could be closed down. So, we need government support at this moment for survival in the current global situation," Mr Hoque, who is also a member of the taskforce, said.
He sought a stimulus package for the local manufacturing industries to weather the shocks of the global financial slowdown.
The government formed the 27-member taskforce comprising politicians, economists and business representatives on March 18 last. It held its first meeting on March 24.
In April, the government proposed a stimulus package involving Tk 34.24 billion, based on recommendations of the taskforce.
However, the two major trade bodies of the apparel sector, BGMEA and BKMEA, were highly critical of it as the highest export-earning ready-made garment (RMG) sector was excluded altogether from the proposed package.
Recently, the apparel makers sought a stimulus fund of Tk 30 billion ahead of the Eid festival saying that unless they were given the fund, they would not be able to pay wages and bonuses of their workers as they claimed to have been hit hard by fallouts from the global financial meltdown.