Generating employment and income
Tuesday, 7 April 2009
Anwar Iqbal
THE finance adviser to the immediate past caretaker government -- before departing from office -- made a projection of the Bangladesh economy for the short- and the medium-terms. The economy's outlook for the short term or until the end of the current fiscal year, according to him, would not be unfavourable. But he was not so optimistic about the next fiscal year, 2009-10, from visualising the deteriorating conditions of the global economy.
The incumbent finance minister shares the same view and this is reflected in his various statements about the global recession, starting to take a toll on the Bangladesh economy. Thus, notwithstanding previous opinion that the Bangladesh economy not having so much linkage with the global economy or the staying power of cheaper Bangladeshi export products, would be substantially spared the ravages of global recession, the portents of the negative impact of that recession on the economy is actually growing larger. Adverse externalities such as claimed falling export orders for the garments sector and less prospects of overseas employment for Bangladeshis, are creating fears about major job losses in the two pivotal economic sectors.
Therefore, timely policies and their equal timely execution would be very important to weather the likely to be difficult period in the next fiscal year. Focused policy prescriptions will be required to address the issues of jobs and income. Every effort will have to be made to create cushions for the large scale job generating garments sector. Government to this end should consider as much as possible on its part, the giving of various incentives, duty cuts, improved supply of energy and other supports to garments industries so that their capacity utilisation can be unaffected making unnecessary the shedding of jobs.
A plan must be drawn up and executed with a sense of urgency to secure non-traditional markets for manpower. It should also include vigorous diplomatic efforts to maintain market shares for manpower in the traditional manpower importing countries such as Saudi Arabia and Malaysia. Libya will reportedly take in a large number of people for its various economic development projects. The Bangladesh authorities will have to make a head-start to exploit manpower export opportunities in Libya on a sustainable basis.
New openings for manpower exports in other African countries, in Europe and Canada, should be explored. Manpower exporters under the government's facilitation and guidance should embark on programmes to start up projects for the training and export of professionals such as nurses. There is a large unmet demand for nurses in the western countries and any prospective manpower exporter can very gainfully tap this market by starting with a medium to longer term training programme for nurses. Similar opportunities are there for training and sending professionals in other areas. The net of these activities will improve and steady the rate and returns from job creation for the overseas markets over the medium- and longer-terms.
Considering that the export-led growth strategy will confront some stumbling blocks in the coming fiscal year and also beyond, considerable reorientation will be necessary to target production activities for the domestic markets. But increasing of home consumption is dependent on demand and that demand is again linked to purchasing power. Thus, all possible monetary and fiscal tools will have to be utilised expertly to create and sustain greater demands in the domestic economy for all sorts of goods. If the producers sense such a demand, they will opt for maintaining the present level of production or go for even stepped-up production to meet this demand and make their reasonable profits. In the process, jobs will be saved and additional jobs can be created. But the producers also will need to be kept motivated with the right kinds of governmental incentive measures and supports in different forms.
THE finance adviser to the immediate past caretaker government -- before departing from office -- made a projection of the Bangladesh economy for the short- and the medium-terms. The economy's outlook for the short term or until the end of the current fiscal year, according to him, would not be unfavourable. But he was not so optimistic about the next fiscal year, 2009-10, from visualising the deteriorating conditions of the global economy.
The incumbent finance minister shares the same view and this is reflected in his various statements about the global recession, starting to take a toll on the Bangladesh economy. Thus, notwithstanding previous opinion that the Bangladesh economy not having so much linkage with the global economy or the staying power of cheaper Bangladeshi export products, would be substantially spared the ravages of global recession, the portents of the negative impact of that recession on the economy is actually growing larger. Adverse externalities such as claimed falling export orders for the garments sector and less prospects of overseas employment for Bangladeshis, are creating fears about major job losses in the two pivotal economic sectors.
Therefore, timely policies and their equal timely execution would be very important to weather the likely to be difficult period in the next fiscal year. Focused policy prescriptions will be required to address the issues of jobs and income. Every effort will have to be made to create cushions for the large scale job generating garments sector. Government to this end should consider as much as possible on its part, the giving of various incentives, duty cuts, improved supply of energy and other supports to garments industries so that their capacity utilisation can be unaffected making unnecessary the shedding of jobs.
A plan must be drawn up and executed with a sense of urgency to secure non-traditional markets for manpower. It should also include vigorous diplomatic efforts to maintain market shares for manpower in the traditional manpower importing countries such as Saudi Arabia and Malaysia. Libya will reportedly take in a large number of people for its various economic development projects. The Bangladesh authorities will have to make a head-start to exploit manpower export opportunities in Libya on a sustainable basis.
New openings for manpower exports in other African countries, in Europe and Canada, should be explored. Manpower exporters under the government's facilitation and guidance should embark on programmes to start up projects for the training and export of professionals such as nurses. There is a large unmet demand for nurses in the western countries and any prospective manpower exporter can very gainfully tap this market by starting with a medium to longer term training programme for nurses. Similar opportunities are there for training and sending professionals in other areas. The net of these activities will improve and steady the rate and returns from job creation for the overseas markets over the medium- and longer-terms.
Considering that the export-led growth strategy will confront some stumbling blocks in the coming fiscal year and also beyond, considerable reorientation will be necessary to target production activities for the domestic markets. But increasing of home consumption is dependent on demand and that demand is again linked to purchasing power. Thus, all possible monetary and fiscal tools will have to be utilised expertly to create and sustain greater demands in the domestic economy for all sorts of goods. If the producers sense such a demand, they will opt for maintaining the present level of production or go for even stepped-up production to meet this demand and make their reasonable profits. In the process, jobs will be saved and additional jobs can be created. But the producers also will need to be kept motivated with the right kinds of governmental incentive measures and supports in different forms.