WB requested to provide 'direct' finance to private sector

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FE Report
As economists and chamber leaders chided Wednesday the World Bank for its lending programmes linked to policy prescriptions, a top economist of the bank maintained that the government should take its decisions considering the people's needs.
Private sector leaders also sought the global development lender's support for developing infrastructure and human capital, insisting Bangladesh will be able to achieve seven to eight per cent growth a year if the development lender channels its funds to these priority areas.
"The World Bank should support us for infrastructure and human development to help attain the country's quest for attaining seven to eight per cent annual growth," president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Mir Nasir Hossain told a seminar in the city, organised by the World Bank.
Speaking at the seminar, the apex chamber leader listed weak governance, inadequate power, overburdened port and acute shortage of skilled manpower as roadblocks to moving toward a higher growth path needed to become a middle-income nation by 2016.
In an apparent attempt to convince a wary audience, chief economist for South Asia Shantayanan Devarajan said Bangladesh should take its decisions based on the people's opinions, not on those of donors.
"It's an issue of political consensus … You should take decisions on what the people say, not what we say," Devarajan told the audience that fired a broad side at the bank's policies, notably further liberlaisation and reduction of subsidies.
The debate emerged after a key-note presentation on "Challenges for Bangladesh in becoming a Middle Income Country (MIC)" made by a bank economist Sandeep Mahajan.
Mahajan seemed to be upbeat about Bangladesh's potential to become an MIC by 2016, saying an impressive growth record, sound economic fundamentals, demographic dividend, substantial improvements in human development and established entrepreneurial culture are "reasons to be optimistic."
Bangladesh's US$470 in per capita gross national income in 2005 has put it in the rank of a lower income nation, although the lender's threshold for a middle-income country was capped at $870.
But his optimism is also not devoid of challenges. The WB economist said for sustaining a seven to eight per cent growth rate, a deeper labour-intensive manufacturing base and deepening global integration were the factors Bangladesh should take seriously.

In his prepared speech, Mir Nasir called upon donors to provide "direct finance" to the private sector to help foster innovation in manufactured products.
In this regard, he identified products like diversified apparel, leather and jute goods, biologically-grown fruits and vegetables, sub-contracting industries and potential export products for donors' direct interventions.
As market economy and liberalisation have exposed the local industries to global competition, Mir Nasir said, the bank should channel its funds to developing the country's infrastructure, enabling Bangladeshi entrepreneurs to compete with their counterparts who enjoy better infrastructure and supportive environment.