Growth centred on domestic economy
Friday, 6 January 2012
Economic growth in some countries which are the biggest destinations of the export commodities of Bangladesh could be very poor or even in the minus growth category in the new year. All possibilities are there that Bangladesh's export trade could be badly affected as recession more and more engulfs many Western countries. Thus, the growth prospects of Bangladesh economy, based largely on the export-led growth strategy, might confront some serious difficulties in the new year.
So, to maintain a decent level of growth for the Bangladesh economy will be a very challenging. Even under apparently unattractive conditions, we think the government here will retain in its hands the power to motivate the investors through fiscal policies designed to encourage investment. In the same way, monetary measures such as the ones that lead to lowering of the cost of funds, maintenance of a reasonable lending rate framework, greater availability of bank loans for the private sector, etc., can have positive effects in encouraging investments. In sum, the policy makers can aim for expansion of the economy with an eye for the domestic market and this strategy can be good enough for meeting the ends of profits of businesses, employment, income earnings, reduction of poverty and improvement in standard of living.
GDP increase-- centred on the home market-- may be further useful because the same carries the possibility of much greater circulation of resources among the highest number of people in the country and, thus, the prospects of higher individual income, leading to greater economic or distributive justice. There is much room for expanded economic activities in some areas of the home market. Appropriate fiscal and monetary policies could draw ample investment to the relevant areas to produce a desirable level of growth of the GDP. In other words, GDP losses from export can be offset by creating and meeting such demands at home.
Zahid Hossain
Uttara, Dhaka
So, to maintain a decent level of growth for the Bangladesh economy will be a very challenging. Even under apparently unattractive conditions, we think the government here will retain in its hands the power to motivate the investors through fiscal policies designed to encourage investment. In the same way, monetary measures such as the ones that lead to lowering of the cost of funds, maintenance of a reasonable lending rate framework, greater availability of bank loans for the private sector, etc., can have positive effects in encouraging investments. In sum, the policy makers can aim for expansion of the economy with an eye for the domestic market and this strategy can be good enough for meeting the ends of profits of businesses, employment, income earnings, reduction of poverty and improvement in standard of living.
GDP increase-- centred on the home market-- may be further useful because the same carries the possibility of much greater circulation of resources among the highest number of people in the country and, thus, the prospects of higher individual income, leading to greater economic or distributive justice. There is much room for expanded economic activities in some areas of the home market. Appropriate fiscal and monetary policies could draw ample investment to the relevant areas to produce a desirable level of growth of the GDP. In other words, GDP losses from export can be offset by creating and meeting such demands at home.
Zahid Hossain
Uttara, Dhaka