‘Focus on good governance and job creation’

The business community wants to see all-out steps on job creation and good governance as well as measures aimed at ensuring stability in the economy from the new government once it takes over, said the top business leader of Bangladesh.

"We want a stable Bangladesh," said Mahbubul Alam, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), in an interview with The Daily Star on the eve of the 12th parliamentary elections.

He says the business community hopes the new government will implement the promises made in the manifesto. "Particularly, it should concentrate on employment generation and good governance. We want to a business-friendly government."

"We have always said that politics are for individuals and political parties but the economy belongs to all of us. So, we need a stable economy."

The Awami League-led government in the past 15 years has been lauded for being business-friendly. Still, the sector faces some of the persisting challenges.

"I hope the new government will address the bottlenecks businesses are witnessing. There should be adequate emphasis on keeping the supply chain smooth," Alam said.

The chief of the country's apex trade body cited challenges such as the US dollar crisis stemming from the Russia-Ukraine war and inadequate policy responses.

"Initiatives have to be taken so that the dollar inflows to Bangladesh accelerates within a short period time."

Owing to higher US dollar outflows compared to inflows, Bangladesh's foreign currency reserves have halved in two years, forcing the government to tighten imports, leading higher consumer prices to persist for more than a year and a half, hurting the low-income groups dispropionately.

He says industries should be able to run their operations as smoothly as possible.

Alam suggested short-, mid- and long-term strategies to ride out the foreign exchange crisis.

The short-term strategies should include making Bangladeshi embassies abroad more active so that they can raise awareness among migrant workers to send funds to their beneficiaries at home through official channels.

"If we can raise the inflows of remittances through formal platforms, it will give a huge boost to the remittance collection."

Bangladesh's remittance inflows have remained flat in the past two years although more than 30 lakh people have gone abroad in search of jobs in the last three years.

Migrant workers sent home $21.91 billion in 2023, a year-on-year increase of only 2.96 percent, according to the central bank.

"We also need to raise the skills of the people going abroad. This is because our people are mostly engaged in low-paid jobs whereas people from other South Asian nations are hired in high-paid jobs just because of their skills," Alam said.

The mid-term strategies will include export diversification, according to the business leader. Bangladesh relies on a narrow basket of goods to drive exports, with low- and mid-priced garments accounting for 85 percent of the national income.

Earnings from merchandise shipments rose 1.99 percent to $55.78 billion in the just-concluded calendar year because of the slowdown in apparel sales in the international markets, data from the Export Promotion Bureau showed.

Alam said Bangladesh needs to move to high-end products to get better prices. "Manufacturers should make the most of modern technologies to produce high-end products."

When asked about a massive gap between exports and actual export proceeds, he said there is a misunderstanding.

He argued that suppliers don't get 100 percent payments against the shipments and there are always some arrears, which are shown as unrealised proceeds.

It was shared with the businessman that the unrealised export proceeds increased to $9.6 billion in the last fiscal year of 2022-23 as per the International Monetary Fund.

"We need to be given specific names of the businesses that are behind this mismatch. Then we can deal with it," Alam said.