DHAKA, Feb 18, 2024 (BSS)-Prime Minister’s Economic Affairs Adviser Dr Mashiur Rahman today stressed on the export diversification and value addition to the exportable items.

The Adviser put the emphasis while addressing a seminar on “Bi-annual economic state and future outlook of Bangladesh economy: private sector perspective” as the chief guest organized by the Dhaka Chamber of Commerce and Industry (DCCI).

Dr. Mashiur Rahman said that the country’s economy has experienced fundamental changes during the last decade.

During this period private sector has also flourished remarkably, he said adding that policies should be formed considering the problems and prospects of the private sector.

“Consistent policies will expedite the private sector investment as well as foster Foreign Direct Investment (FDI),” he added.

The Adviser also termed pharmaceutical and light engineering sectors as most potential sectors for Bangladesh.

He said, “We’ve to functionalize the API Park as soon as possible…reforms are needed in the taxation system as still there are some problems and challenges. We should also tap the benefit the huge potentials of the blue economy.”

DCCI president Ashraf Ahmed while presenting the key-note paper said that long-term growth target of achieving a trillion dollar Smart economy requires concerted efforts to reduce cost of doing business, improved ease of doing business, improved regulatory efficiency, install appropriate infrastructure, ensure energy security, improve logistics and finally ensure access to finance for the private sector.
He also emphasised on product as well as market diversification and said that the private sector investment is targeted in FY2024 at 27.4% of GDP while it was 21.8% in FY2023. “Required policies considering the LDC graduation will expedite the private sector investment,” he added.

To facilitate the private sector more, Ashraf requested lower corporate tax, complete automation of taxation system, increasing tax net, reform of SD and Vat act.

As Non-Performing Loan (NPL) has an impact on increasing some intermediary costs for the private sector, he suggested reducing NPL. “Reducing cost of doing business, uninterrupted energy supply at an affordable price, logistic sector development will help private sector for re-investment,”he added.

Later, he said that CMSME sector needs not only access to finance but also access to the technology to grow.

 Chief Economist of Bangladesh Bank Dr. Md. Habibur Rahman said that due to global geo-political instability, price of essentials have increased and Central Bank has already taken necessary measures to tackle the situation.

He informed that Bangladesh Bank will introduce Crawling Peg system to keep exchange rate under control.

Habibur also said that Central Bank has underscored a roadmap to bring NPL in the industrial sector down to 8% within next 2 years. “Bangladesh Bank will maintain contractionary monetary policy until the inflation comes down point to point 6%.”

DCCI former President Shams Mahmud said that for a sustainable future of RMG sector, there is a need to have to have proactive policies.

He also said that for boosting more private sector investment in the country, the government has to ensure energy at an affordable price and ensure uninterrupted gas supply to the industries.

Mahmud also said that after LDC graduation, all must look into expediting the local import substitute industries to be self-sufficient. He also proposed for rationalizing taxation system and continued special support for the CMSMEs.
Dr. Ashikur Rahman, Senior Economist, PRI said macroeconomic instability is not good for private sector.

He also said that the tax-GDP ratio is not up to the expected level while it is hovering around 10%. He also stressed on skills development and reforms of the financial sector.

 Dr. Mohammad Yunus, Research Director, PRI said that there should be a better coordination among the BEZA, BEPZA and Economic Zones Authority to attract the FDI.

He said BSCIC’s industrial plots should be utilized as cluster basis.