For halting deteriorating poverty conditions
Friday, 21 November 2008
The Bangladesh economy has been keeping its head above the waters as periodic statistics from different sources indicate. But the economy has had its share of troubles over the last two years from dwindled-down economic activities. The government's policies were responsible for squeezing the economy. For example, millions of small craftsmen, hawkers and their families were pushed into dire straits due to eviction of vendors from the sidewalks and demolition of haats, bazars and makeshift shopping centres throughout the country immediately after the present government tookover. This proved to be a crushing blow for the myriad of small producers of goods in day-to-day use and their retailers.
Lacking institutional approach, the ferocity of the anti-corruption drive had also a negative impact on trade and industry. Many industrial conglomerates almost came to a halt. The economic activities, thus, were sharply squeezed in the country during the last two years or so. The Sidr storm dealt a further shattering blow to the economy. The government, since then, revised its policies considerably. Business confidence has since been reviving. Nonetheless, investment operations, both by local and foreign investors, are seen to be far lower in scale compared to the past.
But without fully gearing up investment operations, the economy cannot pick up the needed speed. Every year a large number of eligible job seekers add to the staggering member of unemployed. The big challenge for the government to be elected in weeks, would be how best to set the economy on a higher growth track.
Specially, investment operations must increase to create employment and earning opportunities for the people. The latest statistics show that progress achieved in poverty alleviation steadily over the last one and half decades, until 2006, suffered a setback with nearly four million people slipping below the poverty line. Inflation and other factors badly eroded the purchasing power of people, specially the non-affluent. Therefore, this trend needs to be reversed by adopting appropriate policies and their fast implementation. The poor are under greater pressure of reduced income-earning opportunities. Planned creation of ways of earnings for them is very important to arrest the worsening poverty situation.
In this year's budget the government had to significantly expand the social safety net. But these are mainly consumptive in nature. Of greater value for the economy would be the plans that create employment leading to asset formation. It would be more relevant to launch employment-generating programmes announced in the current fiscal's budget. The execution of these programmes should continue by the coming elected government. Other avenues for stepping up the rate of public sector investments should be explored.
The public sector needs to step up investments to offset the lingering nervousness of the private sector. The private sector, of course, cannot be dictated to invest. But to address the prevailing scenario of under- investment and deteriorating poverty scenario, the government should have undertaken measures to invest some out of its own resources to create earning opportunities on a self-sustainable basis.
Sabiha Mahmud
Dhanmondi
Dhaka
Lacking institutional approach, the ferocity of the anti-corruption drive had also a negative impact on trade and industry. Many industrial conglomerates almost came to a halt. The economic activities, thus, were sharply squeezed in the country during the last two years or so. The Sidr storm dealt a further shattering blow to the economy. The government, since then, revised its policies considerably. Business confidence has since been reviving. Nonetheless, investment operations, both by local and foreign investors, are seen to be far lower in scale compared to the past.
But without fully gearing up investment operations, the economy cannot pick up the needed speed. Every year a large number of eligible job seekers add to the staggering member of unemployed. The big challenge for the government to be elected in weeks, would be how best to set the economy on a higher growth track.
Specially, investment operations must increase to create employment and earning opportunities for the people. The latest statistics show that progress achieved in poverty alleviation steadily over the last one and half decades, until 2006, suffered a setback with nearly four million people slipping below the poverty line. Inflation and other factors badly eroded the purchasing power of people, specially the non-affluent. Therefore, this trend needs to be reversed by adopting appropriate policies and their fast implementation. The poor are under greater pressure of reduced income-earning opportunities. Planned creation of ways of earnings for them is very important to arrest the worsening poverty situation.
In this year's budget the government had to significantly expand the social safety net. But these are mainly consumptive in nature. Of greater value for the economy would be the plans that create employment leading to asset formation. It would be more relevant to launch employment-generating programmes announced in the current fiscal's budget. The execution of these programmes should continue by the coming elected government. Other avenues for stepping up the rate of public sector investments should be explored.
The public sector needs to step up investments to offset the lingering nervousness of the private sector. The private sector, of course, cannot be dictated to invest. But to address the prevailing scenario of under- investment and deteriorating poverty scenario, the government should have undertaken measures to invest some out of its own resources to create earning opportunities on a self-sustainable basis.
Sabiha Mahmud
Dhanmondi
Dhaka