Next monetary policy to target inclusive growth: BB governor
Monday, 28 December 2009
FE Report
Bangladesh Bank (BB) would target 'inclusive growth" in its next half-yearly monetary policy due in January after the country weathered the global economic crisis "remarkably well", its governor said Sunday.
Atiur Rahman said major sectors including exports, imports, remittance and the stock market have performed well in 2009 despite the world was mired by the worst recession since the Second World War.
But rather than taking plaudits, he said the BB would now concentrate on boosting growth in the coming year when its main target would be to "cash in on the economy's resilience and spread its benefits to the disadvantaged people".
"Our exports and imports have increased. Other indicators including remittance are showing encouraging signs. The economy has shown its resilience despite deep global recession," Dr Rahman said.
"The monetary policy for next six months will be designed in a way so that the economy can continue its current trend while at the same time ensures benefits for all," he said.
The governor was speaking at the seminar on 'Access to Finance and Access to Information' at the auditorium of Bangladesh Institute of Bank Management (BIBM) in the capital.
Khondker Ibrahim Khaled, chairman of Bangladesh Krishi Bank, Uttam Kumar Deb, additional director and head of Research at Centre for Policy Dialogue, Ananya Raihan, executive director of D.Net and Bandana Saha, director general of BIBM spoke.
The governor said Bangladesh economy once again showed its mettle in 2009 when it passed one of the toughest tests triggered by the global meltdown.
Exports of agricultural products, terry towel, leather bag, ceramics, tableware, handicraft and footwear have increased while monthly shipment in October grew 18 per cent compared to the same period last year, he said.
He said imports have also increased as the country spent Tk 125 billion in importing goods in September, which was Tk 109 billion in the same period last year.
"All the banks and stock markets have done very well this year in the face of global crisis. It was possible due to resilience of our economy. We will declare a monetary policy that encourages this trend," the governor said.
He said the BB was investing heavily in computerisation and automation and as a result the country's banks would be able to get credit reports of their clients online from the Credit Information Bureau (CIB) from mid-2010.
He added despite expansion of banks in rural areas and proliferation of microfinance institutions (MFIs), access to financial services remains limited, inadequately covering all segments of population and sectors.
"Besides, small and micro enterprises often find it difficult and time consuming in accessing credit from the formal financial institutions."
The governor said in rural areas there is a knowledge gap and information asymmetry in agricultural production and marketing, non-firm activities, health, education, employment and disaster management.
He stressed integration of access to information and basic financial services in reducing information gaps in the market, improving borrower selection and credit recovery system, quick and cost effective distribution of workers' remittances in remote areas.
He said telecentres have potentials to gather and spread information about new clients and channel remittances to the recipients in rural areas in due time and at lower costs.
"Besides, telecentres could be useful in providing valuable information on technology, markets, better irrigation systems and so on to the farmers and thus can contribute to favourable market conditions for the farmers," Rahman said.
Telecentre is a public place where people can access computer, Internet and other technologies that can help them gather information and communicate with others.
The common focus of telecentre is to support community and social development through bridging digital divide, said Shah Md. Ahsan Habib, associate professor and director (training) of BIBM, during his paper presentation.
Bandana Saha said information about bank loans is beyond reach of the marginal farmers and micro entrepreneurs.
"They don't know what services the government, non-government and micro credit financial institutions are providing. Similarly, the financial institutions and micro financiers are facing challenges in gathering information on viable lending unit."
So the access to finance and access to information should be integrated for the development of the national economy in general and the rural economy in particular, the BIBM director general said.
Bangladesh Bank (BB) would target 'inclusive growth" in its next half-yearly monetary policy due in January after the country weathered the global economic crisis "remarkably well", its governor said Sunday.
Atiur Rahman said major sectors including exports, imports, remittance and the stock market have performed well in 2009 despite the world was mired by the worst recession since the Second World War.
But rather than taking plaudits, he said the BB would now concentrate on boosting growth in the coming year when its main target would be to "cash in on the economy's resilience and spread its benefits to the disadvantaged people".
"Our exports and imports have increased. Other indicators including remittance are showing encouraging signs. The economy has shown its resilience despite deep global recession," Dr Rahman said.
"The monetary policy for next six months will be designed in a way so that the economy can continue its current trend while at the same time ensures benefits for all," he said.
The governor was speaking at the seminar on 'Access to Finance and Access to Information' at the auditorium of Bangladesh Institute of Bank Management (BIBM) in the capital.
Khondker Ibrahim Khaled, chairman of Bangladesh Krishi Bank, Uttam Kumar Deb, additional director and head of Research at Centre for Policy Dialogue, Ananya Raihan, executive director of D.Net and Bandana Saha, director general of BIBM spoke.
The governor said Bangladesh economy once again showed its mettle in 2009 when it passed one of the toughest tests triggered by the global meltdown.
Exports of agricultural products, terry towel, leather bag, ceramics, tableware, handicraft and footwear have increased while monthly shipment in October grew 18 per cent compared to the same period last year, he said.
He said imports have also increased as the country spent Tk 125 billion in importing goods in September, which was Tk 109 billion in the same period last year.
"All the banks and stock markets have done very well this year in the face of global crisis. It was possible due to resilience of our economy. We will declare a monetary policy that encourages this trend," the governor said.
He said the BB was investing heavily in computerisation and automation and as a result the country's banks would be able to get credit reports of their clients online from the Credit Information Bureau (CIB) from mid-2010.
He added despite expansion of banks in rural areas and proliferation of microfinance institutions (MFIs), access to financial services remains limited, inadequately covering all segments of population and sectors.
"Besides, small and micro enterprises often find it difficult and time consuming in accessing credit from the formal financial institutions."
The governor said in rural areas there is a knowledge gap and information asymmetry in agricultural production and marketing, non-firm activities, health, education, employment and disaster management.
He stressed integration of access to information and basic financial services in reducing information gaps in the market, improving borrower selection and credit recovery system, quick and cost effective distribution of workers' remittances in remote areas.
He said telecentres have potentials to gather and spread information about new clients and channel remittances to the recipients in rural areas in due time and at lower costs.
"Besides, telecentres could be useful in providing valuable information on technology, markets, better irrigation systems and so on to the farmers and thus can contribute to favourable market conditions for the farmers," Rahman said.
Telecentre is a public place where people can access computer, Internet and other technologies that can help them gather information and communicate with others.
The common focus of telecentre is to support community and social development through bridging digital divide, said Shah Md. Ahsan Habib, associate professor and director (training) of BIBM, during his paper presentation.
Bandana Saha said information about bank loans is beyond reach of the marginal farmers and micro entrepreneurs.
"They don't know what services the government, non-government and micro credit financial institutions are providing. Similarly, the financial institutions and micro financiers are facing challenges in gathering information on viable lending unit."
So the access to finance and access to information should be integrated for the development of the national economy in general and the rural economy in particular, the BIBM director general said.