'Overzealous pursuit' of anti-graft drives creates environment of fear
Thursday, 6 September 2007
FE Report
An "overzealous pursuit" of anti-graft and other drives has created an environment of fear, thereby eroding confidence of the businessmen, chamber leaders told a dialogue. They have identified anti-graft, anti-hoarding, tax, bank account searching, money source searching, breaking haats and bazzars, too many questions on every activity and too many lists of offenders as the 'fear factors.' "The overzealous pursuit of these drives and publication of these lists (the corrupt) has created a climate of fear, a feeling of uncertainty and a crisis of confidence among large sections of the business community," a director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) said Wednesday in the city.
"In such a climate, we cannot peacefully create wealth for the nation," Chowdhury added.
"If this is a free market economy, where is the freedom?" Rouf asked.
His comments came in the presence of top policymakers, including the Chief Adviser, who attended the dialogue as the chief guest.
Chief of Army Staff Moeen U Ahmed was present as the special guest.
Rouf also pointed out that the business community found "conflicting" messages at the administrative levels, although there were many "inspirational policy signals" given by top policymakers.
"We're encouraged by the initiatives of the Chief Adviser and the Chief of Army Staff to import essential commodities without fear, but we're questioned by the banks and the NBR about our money source," he pointed out.
"We're assured by the highest authorities of the utmost sympathy because of the flood and related economic slow-down, yet the VAT and tax inspectors flood us with notices and threats," the FBCCI director told the business audience.
In the meeting, president of the Bangladesh chapter of International Chamber of Commerce (ICC,B) Mahbubur Rahman, and a former president of Bangladesh Garment Manufacturers and Exporters Association Annisul Huq presented separate papers, narrating the state of economy.
Annisul Huq also echoed the views of his fellow business leader, saying the private sector is affected by harassment, complications and fear in the areas of taxation.
Huq suggested a market-led growth, rise in production, increase in purchasing power and awareness of international price situation to arrest the price hike of essentials.
He also set a number of proposals, including the formation of SME Cell in every bank, abolishment of collateral system, cutback in interest rate, and credit guarantee scheme, to spur growth in small and medium enterprises.
In his paper, Mahbubur Rahman said weak revenue collection, and higher level of revenue expenditure have exposed fragility of the macro-economic framework in existence.
Low ADP implementation, poor disbursement of foreign aid and higher levels of government borrowings were viewed as some of the major weaknesses in the economy, he added.
The ICC,B president took a swipe at the International Monetary Fund, saying today Bangladesh has been experiencing double-digit inflation, but growth did not follow suit.
"Time has come to review seriously whether IMF/World Bank guidelines and conditionalities have been doing some good in the growth and development of Bangladesh economy in the past," Rahman told the gathering.
He also reiterated that the prescription of multilateral lenders to raise fuel and electricity prices would be "boomerang" for the economy as it will lead to a further pressure on inflation.
"Their suggestion to increase interest rate on agri-credit is going to harm food production and will make Bangladesh a net food importing country in the long-run," he added.
Referring to a growth target of 7.0 per cent for the current fiscal, the ICC,B president said all three major components of GDP (gross domestic product) such as agriculture, industry and service sectors would have to enhance their contribution further to attain this optimistic growth target.
"Recent slowdown in the growth of gross capital formation and slow private investment, however, does not invoke much optimism in this regard," Rahman said.
Saying that foreign direct investments (FDI) are on the decline in recent times, the ICC,B pointed out that overseas capital were largely confined to the telecom, banking, oil and gas exploration sectors, which are not "contributing much to the real economy."
"FDIs so far neither contributed to any major technology transfer nor generated significant employment," Rahman said.
An "overzealous pursuit" of anti-graft and other drives has created an environment of fear, thereby eroding confidence of the businessmen, chamber leaders told a dialogue. They have identified anti-graft, anti-hoarding, tax, bank account searching, money source searching, breaking haats and bazzars, too many questions on every activity and too many lists of offenders as the 'fear factors.' "The overzealous pursuit of these drives and publication of these lists (the corrupt) has created a climate of fear, a feeling of uncertainty and a crisis of confidence among large sections of the business community," a director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) said Wednesday in the city.
"In such a climate, we cannot peacefully create wealth for the nation," Chowdhury added.
"If this is a free market economy, where is the freedom?" Rouf asked.
His comments came in the presence of top policymakers, including the Chief Adviser, who attended the dialogue as the chief guest.
Chief of Army Staff Moeen U Ahmed was present as the special guest.
Rouf also pointed out that the business community found "conflicting" messages at the administrative levels, although there were many "inspirational policy signals" given by top policymakers.
"We're encouraged by the initiatives of the Chief Adviser and the Chief of Army Staff to import essential commodities without fear, but we're questioned by the banks and the NBR about our money source," he pointed out.
"We're assured by the highest authorities of the utmost sympathy because of the flood and related economic slow-down, yet the VAT and tax inspectors flood us with notices and threats," the FBCCI director told the business audience.
In the meeting, president of the Bangladesh chapter of International Chamber of Commerce (ICC,B) Mahbubur Rahman, and a former president of Bangladesh Garment Manufacturers and Exporters Association Annisul Huq presented separate papers, narrating the state of economy.
Annisul Huq also echoed the views of his fellow business leader, saying the private sector is affected by harassment, complications and fear in the areas of taxation.
Huq suggested a market-led growth, rise in production, increase in purchasing power and awareness of international price situation to arrest the price hike of essentials.
He also set a number of proposals, including the formation of SME Cell in every bank, abolishment of collateral system, cutback in interest rate, and credit guarantee scheme, to spur growth in small and medium enterprises.
In his paper, Mahbubur Rahman said weak revenue collection, and higher level of revenue expenditure have exposed fragility of the macro-economic framework in existence.
Low ADP implementation, poor disbursement of foreign aid and higher levels of government borrowings were viewed as some of the major weaknesses in the economy, he added.
The ICC,B president took a swipe at the International Monetary Fund, saying today Bangladesh has been experiencing double-digit inflation, but growth did not follow suit.
"Time has come to review seriously whether IMF/World Bank guidelines and conditionalities have been doing some good in the growth and development of Bangladesh economy in the past," Rahman told the gathering.
He also reiterated that the prescription of multilateral lenders to raise fuel and electricity prices would be "boomerang" for the economy as it will lead to a further pressure on inflation.
"Their suggestion to increase interest rate on agri-credit is going to harm food production and will make Bangladesh a net food importing country in the long-run," he added.
Referring to a growth target of 7.0 per cent for the current fiscal, the ICC,B president said all three major components of GDP (gross domestic product) such as agriculture, industry and service sectors would have to enhance their contribution further to attain this optimistic growth target.
"Recent slowdown in the growth of gross capital formation and slow private investment, however, does not invoke much optimism in this regard," Rahman said.
Saying that foreign direct investments (FDI) are on the decline in recent times, the ICC,B pointed out that overseas capital were largely confined to the telecom, banking, oil and gas exploration sectors, which are not "contributing much to the real economy."
"FDIs so far neither contributed to any major technology transfer nor generated significant employment," Rahman said.