News
DCCI's Expectations in the New Year
The global economic downturn due to the COVID pandemic and the Russia-Ukraine war have hindered Bangladesh's progressive growth. However, the enterprising spirit of our business community and joint efforts of the public and private sectors have largely assisted our economic recovery process. To further accelerate the country's economic recovery in 2023, DCCI urges the government to focus on uninterrupted and affordable energy supply to local and export-oriented manufacturing industries, improve the ease of doing business, develop infrastructural environment conducive to attracting local and foreign investment, export diversification, facilitate easier access to credit facilities for CMSMEs and so on.
The recent increase in energy prices is disrupting the production of energy-intensive industries and they are increasingly falling behind to compete in international trade. DCCI is of the view that a long-term planning should be adopted following a predictable pricing policy in determining the energy price. In order to ensure energy security, it is necessary to urgently explore new gas fields, strengthen long-term energy supply contracts and find alternative sources of energy import. Besides, it is necessary to ensure uninterrupted supply of energy to the industries and the government is requested to emphasize on it as a matter of priority.
Issues such as the ongoing foreign currency crisis and devaluation of the Taka against the US Dollar has challenged the country's financial sector, resulting in some negative impact on the import of energy, industrial raw materials and supply chain for local export-oriented industries. More emphasis is needed on increasing incentives to increase remittance inflow in order to enhance the foreign exchange reserve. At the same time, ‘currency-swap’ may be prioritized to meet necessary import expenditure.
In addition, DCCI believes that in order to mitigate the liquidity crisis in the financial sector, the on-going austerity measures taken by the government should be maintained and project implementation efficiency should be increased ensuring good governance.
Due to the global economic problems and inadequate revenue collection of the government, the government has to borrow more than its target from the local banks in recent times. As a result, the available credit to the manufacturing private sector may decrease. It should be noted that if the private sector credit flow is interrupted, local investment and employment retention may decline. Dhaka Chamber feels that, in order to achieve higher revenue collection, the government should focus on complete automation of revenue management, necessary reforms of existing revenue laws and increase the avenues for revenue generation. In this connection, special attention should be given not to harass any existing taxpayers.
After the LDC graduation, in order to continue the existing export growth, we have to take initiative of signing free trade agreements (FTAs) with potential trade partners and various regional economic blocs. In this transitional period of LDC graduation, we need to ensure proper readiness and preparation of local businesses. DCCI also feels that, inter alia, export diversification, infrastructure development, skills development, technological advancement, expediting backward linkage industries, reforms of tax and tariff structure and continued negotiation for ensuring “International Support Measures” even after LDC graduation are important agendas that the government should focus on.
Lastly, to increase local and foreign investment in the country, there is a need for timely reforms of various laws such as the Companies Act, Arbitration Act, Bankruptcy and Insolvency Act. Utilizing the technological excellence of the 4IR to meet the skill needs of local industries and international market, special attention should be given on skilled and high-skilled manpower export. In this case, there is no alternative but to emphasis and strengthen the industry and academia relationship for best utilization of country’s demographic dividend in future.
Published on: 2023-01-01