The great need for business-related reforms
Monday, 9 November 2009
Ahmed Ali
The establishment of the Better Business Forum (BBF) was one of the few "pro-active" moves by the immediate past caretaker government for sustained confidence of the businesses. It did otherwise cause a great deal of damage to the businesses by its "thoughtless" actions on many fronts in a defused manner, without concentrating on efforts for accomplishing the "task" that it could have done better within its two-year time-frame for governance. It went too far, leaving all concerned to make all kinds of guesses about its real motive -- political or otherwise.
However, the formation of the BBF, alongwith that of the Regulatory Reforms Commission (RRC) under an executive fiat by-passing the legal technalities or niceties, was beyond doubt a welcome move. This move was designed to establish mechanisms to carry out reforms to facilitate businesses. With participation by members of the government and the policy-makers at the highest level, the BBB in particular set its journey to assist the government in framing concrete policies or measures, supportive of the growth of the businesses. It facilitated mutual consultation between government and business to subsequently implement policies in order to build a more conducive business environment. This environment is vitally important for positively motivating entrepreneurs and investors.
BBF did reportedly make 126 recommendations for the short-, medium- and longer- terms. The six short term proposals were fulfilled. Only half of the 56 medium-term proposals, covering a maximum period of two years, could be implemented. Sixty four other proposals of long-term nature have been pending for either further review by the BBF or implementation. The implementation of all such proposals are necessary to better the business and investment climate. When the BBF was formed, it was decided at the highest level that it would take actions with extraordinary speed to overcome the archaic conditions facing business in order to motivate the potential investors and entrepreneurs. Unfortunately, this spirit could not be entirely upheld through real actions for accomplishments.
The simultaneous launching of the Regulatory Reforms Commission (RRC) has been another feat of the caretaker government. It was purported to identifying and removing obsolete or unhelpful rules and regulations to promote commercial activities. In many ways, complementaries are otherwise strong in the relationship between the RRC and the BBF. This is largely because of the fact that full implementation of many of the reforms recommended by the BBF requires, as of necessity, the rewriting, annulment, substitution, amendments or enlargement of laws pertaining to different areas of business activities that are within the functional domain of the RCC. Since its inception on November 19, 2007, the RCC formulated 11 interim reports and sent them for approval and implementation to respective ministries. But out of them only two reports could, however, be implemented, according to a report. This would otherwise suggest a tardy progress on the part of the RCC in meeting its objectives.
Businesses and all concerned ones expected that both the RCC and the BBF, being functionally well-designed and operationally well-purported, would receive active support of the elected government that has otherwise spelt out the promotion of healthy and competitive growth of business as one of its prime economic objectives. But unfortunately things are yet to move in the right direction. Contradictory signals have, of late, come about the future of the RCC. The BBF also remains in limbo, even ten months after the elected democratic government being in power. The reformative activities, specially in the business spheres, do need to be actively carried forward with full vigour by the elected government. The BBF and the RRC should have long life for the economy and the country to get the benefits of their good work.
The top functionaries of the new government have so far unequivocally stated that it would clear up any misunderstanding whether these bodies would be retained and their potentials harnessed. Doing of this is important to add to confidence of businesses as well as to progressively take steps to improve conditions for businesses. Time is otherwise running out for the government to do the hard part of the reforms. The best part of time for any elected government to start doing its reformative actions is within the first year of its tenure in periodic electoral cycle.
Meanwhile, the lower position of Bangladesh as a place for location of investment sites in a number of reports, prepared by international bodies, underlines high costs of doing business here. It heightens the need for strong and effective actions through de-regulations and de-controls wherever necessary to curb red tape, cut corruption and reduce costs of doing business. Such reports continue to serve as pointers to the need for doing a great deal more to improve the country's image as a destination for investments.
It must be admitted that Bangladesh is yet to attract investors specially the foreign ones, notwithstanding all tall claims by every successive government here about "investment-friendly" policies. Its indicators of business conditions are not anyway impressive yet as to attract major investment operations . The same need to improve -- substantially -- for creating a major stimulus among the investors.
The present elected government needs to give proof of its resolve to press ahead with business-related reforms. And here taste of the pudding lies in its eating. The government has to take effective moves sooner than better to give strong signals to the businesses about its meaning business about reforms and promoting investment. If business reforms-related activities are not pursued in earnest and at an accelerated pace, private investment activities in the economy in real productive sectors are unlikely to pick up much.
The establishment of the Better Business Forum (BBF) was one of the few "pro-active" moves by the immediate past caretaker government for sustained confidence of the businesses. It did otherwise cause a great deal of damage to the businesses by its "thoughtless" actions on many fronts in a defused manner, without concentrating on efforts for accomplishing the "task" that it could have done better within its two-year time-frame for governance. It went too far, leaving all concerned to make all kinds of guesses about its real motive -- political or otherwise.
However, the formation of the BBF, alongwith that of the Regulatory Reforms Commission (RRC) under an executive fiat by-passing the legal technalities or niceties, was beyond doubt a welcome move. This move was designed to establish mechanisms to carry out reforms to facilitate businesses. With participation by members of the government and the policy-makers at the highest level, the BBB in particular set its journey to assist the government in framing concrete policies or measures, supportive of the growth of the businesses. It facilitated mutual consultation between government and business to subsequently implement policies in order to build a more conducive business environment. This environment is vitally important for positively motivating entrepreneurs and investors.
BBF did reportedly make 126 recommendations for the short-, medium- and longer- terms. The six short term proposals were fulfilled. Only half of the 56 medium-term proposals, covering a maximum period of two years, could be implemented. Sixty four other proposals of long-term nature have been pending for either further review by the BBF or implementation. The implementation of all such proposals are necessary to better the business and investment climate. When the BBF was formed, it was decided at the highest level that it would take actions with extraordinary speed to overcome the archaic conditions facing business in order to motivate the potential investors and entrepreneurs. Unfortunately, this spirit could not be entirely upheld through real actions for accomplishments.
The simultaneous launching of the Regulatory Reforms Commission (RRC) has been another feat of the caretaker government. It was purported to identifying and removing obsolete or unhelpful rules and regulations to promote commercial activities. In many ways, complementaries are otherwise strong in the relationship between the RRC and the BBF. This is largely because of the fact that full implementation of many of the reforms recommended by the BBF requires, as of necessity, the rewriting, annulment, substitution, amendments or enlargement of laws pertaining to different areas of business activities that are within the functional domain of the RCC. Since its inception on November 19, 2007, the RCC formulated 11 interim reports and sent them for approval and implementation to respective ministries. But out of them only two reports could, however, be implemented, according to a report. This would otherwise suggest a tardy progress on the part of the RCC in meeting its objectives.
Businesses and all concerned ones expected that both the RCC and the BBF, being functionally well-designed and operationally well-purported, would receive active support of the elected government that has otherwise spelt out the promotion of healthy and competitive growth of business as one of its prime economic objectives. But unfortunately things are yet to move in the right direction. Contradictory signals have, of late, come about the future of the RCC. The BBF also remains in limbo, even ten months after the elected democratic government being in power. The reformative activities, specially in the business spheres, do need to be actively carried forward with full vigour by the elected government. The BBF and the RRC should have long life for the economy and the country to get the benefits of their good work.
The top functionaries of the new government have so far unequivocally stated that it would clear up any misunderstanding whether these bodies would be retained and their potentials harnessed. Doing of this is important to add to confidence of businesses as well as to progressively take steps to improve conditions for businesses. Time is otherwise running out for the government to do the hard part of the reforms. The best part of time for any elected government to start doing its reformative actions is within the first year of its tenure in periodic electoral cycle.
Meanwhile, the lower position of Bangladesh as a place for location of investment sites in a number of reports, prepared by international bodies, underlines high costs of doing business here. It heightens the need for strong and effective actions through de-regulations and de-controls wherever necessary to curb red tape, cut corruption and reduce costs of doing business. Such reports continue to serve as pointers to the need for doing a great deal more to improve the country's image as a destination for investments.
It must be admitted that Bangladesh is yet to attract investors specially the foreign ones, notwithstanding all tall claims by every successive government here about "investment-friendly" policies. Its indicators of business conditions are not anyway impressive yet as to attract major investment operations . The same need to improve -- substantially -- for creating a major stimulus among the investors.
The present elected government needs to give proof of its resolve to press ahead with business-related reforms. And here taste of the pudding lies in its eating. The government has to take effective moves sooner than better to give strong signals to the businesses about its meaning business about reforms and promoting investment. If business reforms-related activities are not pursued in earnest and at an accelerated pace, private investment activities in the economy in real productive sectors are unlikely to pick up much.