CPD projects three economic risk factors for next two years

A local think tank has projected three key risk factors for Bangladesh's economy for the next two years - inflation, an economic downturn, and poverty coupled with inequality.

The Centre for Policy Dialogue (CPD) also highlighted 17 major issues hindering business expansion, including corruption, high tax rates, inefficient bureaucracy, foreign currency instability, inflation, and limited access to finance.

Other challenges are inadequate infrastructure, policy instability, poor work ethic in the labour force, inadequate educated labour force, complexity in tax regulations, climate change impacts, insufficient innovation capacity, government instability, poor public health systems, and restrictive labour regulations

The findings were revealed during a programme titled "Reform in Bangladesh's Business Competitiveness and Processes: Agenda for the Interim Government", presented by Dr. Khondaker Golam Moazzem of the CPD on Sunday.

Mr. Lutfey Siddiqi, Chief Adviser's envoy for International Affairs, attended the programme as chief guest. Ms Fahmida Khatun, executive director of CPD, moderated the event at a city centre.

Chowdhury Ashik Mahmud Bin Harun, executive chairman of the Bangladesh Investment Development Authority (BIDA), and Abdul Awal Mintoo, former FBCCI president, were present as special guests.

Javed Akhtar, Foreign Investors Chamber of Commerce and Industry (FICCI) president, Fazlee Shamim Ehsan, BKMEA executive president, Ashraf Ahmed, DCCI president; and Shaukat Aziz Russell, BTMA president, also spoke among others.

Speaking as the chief guest, Mr Siddiqi emphasised that Bangladesh is grappling with two major deficits - an external deficit and an internal fiscal deficit.

He noted that the country has a younger population compared to Singapore, China, and Japan, which could be a demographic advantage.

Mr. Siddiqi also pointed out that several reforms, including cultural changes within the government, have already been initiated.

BIDA Chairman Harun highlighted five priority areas aimed at boosting investment in the country. They are enhancing the quality of services, engaging consultants for improvement, ensuring policy continuity, improving access to resources, and combating corruption at all levels.

Mr Mintoo stressed that reform is a continuous process and noted that changes in the agriculture sector began thousands of years back.

He criticised the criminalisation of politics and emphasised the need for political reform as the top priority.

He also criticised the central bank's recent monetary policies, highlighting inefficiencies affecting businesses.

Fahim Mashroor, former BASIS president, said that doing business in Bangladesh is more difficult compared to other countries.

He pointed out that job creation should be the main objective of supporting business, but here in Bangladesh businesses are primarily treated as revenue-generating entities for tax authorities.

Mr Javed Akhtar underscored the need for policy consistency, stating that frequent changes in tax rates negatively affect business activities.

He also noted the high effective tax rate in the country and the challenges of acquiring land, which can take up to 30 months to complete.

[email protected]