Bangladesh (Commonwealth Union)_ In a recent seminar organized by the Dhaka Chamber of Commerce and Industry (DCCI), top businessmen in Bangladesh have urgently called on the interim government to take decisive actions to lower bank interest rates, stimulate demand for local goods, and eliminate barriers to exports. As the nation grapples with rising economic pressures, these business leaders emphasized the urgent need for a more conducive environment for commerce.
The impact of high interest rates on business operations
A significant concern raised during the seminar was the escalation of bank interest rates to double-digit levels, reaching as high as 14 percent. Business leaders, including DCCI President Ashraf Ahmed, expressed that these soaring rates exacerbate the cost of doing business and ultimately threaten profitability. “There is no country where businesspeople can thrive with a double-digit bank interest rate,” stated Syed Nasim Manzur, former president of the Metropolitan Chamber of Commerce and Industry, highlighting the unsustainable situation for entrepreneurs in Bangladesh. The business community is particularly worried that these elevated interest rates could stifle investment and growth. Manzur pointed out that the country’s economic health is at stake, with fears of contraction if current conditions persist. He urged the government to foster a business-friendly environment that could stimulate investment and job creation.
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Law and order: A crucial element for economic stability
The issue of law and order also featured prominently in discussions at the seminar. Business leaders unanimously agreed that without improvements in security and governance, economic recovery would remain elusive. Mir Nasir Hossain, former president of the Federation of Bangladesh Chambers of Commerce and Industry, lamented that the interim government has yet to establish confidence among businesspeople, which is critical for fostering a favourable investment climate. Additionally, business leaders underscored the necessity for government dialogue with the business community to better understand and address their concerns. The lack of communication has been a recurring issue, with Hossain emphasizing that no businessperson has felt able to convey their grievances to the National Board of Revenue in a decade.
The role of foreign investment and economic growth
Foreign Direct Investment (FDI) is a crucial component for economic enhancement, but current conditions have led many investors to adopt a wait-and-see approach. As Manzur noted, foreign investments are essential for improving product value and integrating into global supply chains. However, with the government still navigating a transition phase, investors remain hesitant to commit fresh capital, further stalling potential job creation. To remedy this, business leaders called for strategic measures to ensure law and order in industrial zones, arguing that improved security would positively influence investor confidence. Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association, echoed these sentiments, noting that building trust with buyers is critical for sustaining business operations.
The need for collaborative solutions
Ahsan Khan Chowdhury, CEO of Pran-RFL Group, stated that employment generation is a moral responsibility of business leaders. However, he asserted that a stable environment is paramount for industries to flourish. Reflecting on the previous government’s shortcomings, M Masrur Reaz, chairman of Policy Exchange Bangladesh, mentioned that timely decisions are essential for macroeconomic stability, which has not been adequately addressed. Furthermore, Chowdhury also highlighted the significant responsibility of the interim government in ensuring a secure business landscape. “Without active and responsive law enforcement, businesses will continue to face challenges such as arson and vandalism,” he warned, reiterating the importance of an effective industrial police force.
A call for urgent government action The DCCI seminar served as a critical platform for the business community to articulate their challenges and aspirations. Business leaders underscored that addressing high bank interest rates and ensuring law and order are foundational to reviving the economy. As Bangladesh seeks to navigate these turbulent economic waters, the collaboration between the government and the business sector will be essential for fostering a vibrant economic environment that can sustain growth and stability. The interim government’s responsiveness to these calls will be pivotal in shaping the future of Bangladesh’s economy.
