Business
Lag in pvt investment and its minimal contribution to GDP critical concern for South Asia’s job market: World Bank Economist
During a seminar organised by the South Asian Network on Economic Modelling (SANEM) and the World Bank, experts highlighted the optimistic growth outlook for South Asia compared to other emerging markets and developing economies. However, they pointed out significant hurdles in job creation, attributing these challenges to a lack of necessary policy reforms.
The seminar, titled “Is South Asia Experiencing Jobless Development?” took place at Dhaka’s BRAC Centre Inn Auditorium on Thursday, coinciding with the release of the World Bank's April 2024 report on "South Asia Development Update."
Dr. Franziska Ohnsorge, the World Bank's Chief Economist for South Asia, emphasised the urgent need for policy reforms to dismantle barriers to job creation in her presentation of the "Report Focusing on Job Resilience in South Asia in April 2024."
According to Dr. Ohnsorge, the lag in private investment and its minimal contribution to GDP, compared to other developing regions, is a critical concern for South Asia’s job market.
Trade openness and institutional quality were identified as pivotal factors to invigorate job opportunities in the region. Dr. Ohnsorge highlighted the low trade-to-GDP ratio in South Asia and pointed out specific areas of growth such as the Bangladeshi readymade garment (RMG) sector and the Indian IT industry. She criticised Bangladesh for imposing high barriers to trade, which she believes are stifling growth and employment opportunities.
The seminar also featured insights from SANEM Executive Director Dr. Selim Raihan, Vice-Chancellor of Asian University for Women Dr. Rubana Haq, Professor Sayema Haque Bidisha from the Department of Economics at Dhaka University, and Bernard Haven, the World Bank's Senior Economist in Bangladesh. The panelists discussed various aspects of job creation, the quality of jobs, and integrating vulnerable populations into the workforce.
Bernard Haven underscored the interconnection between job creation and macroeconomic issues, advocating for more foreign direct investment (FDI) and a favorable business environment. He emphasised the critical role of boosting productivity and investing in human capital to enhance worker and firm productivity.
Haven also highlighted the need for better firm management, support for women’s labor force participation, reduced migration costs, and expanded social safety nets to ensure a more inclusive and productive workforce.
The seminar concluded with a call to action for South Asian countries to adopt comprehensive policy reforms to address the persistent challenges of jobless growth and fully leverage their economic potential.
34% of Bangladesh's revenue spent on debt repayment: CPD
Bangladesh finds itself in a precarious fiscal position, with a significant portion of its revenue dedicated to debt repayment, as revealed by Dr. Debapriya Bhattacharya, a distinguished fellow at the Centre for Policy Dialogue (CPD).
According to Dr. Bhattacharya, two-thirds of the government's total debt originates from domestic sources, bringing the per capita debt to an approximate $850.
CPD wants adjustment in capacity charges instead of raising power tariff to reduce subsidy
During a seminar on Thursday, titled “Bangladesh’s External Borrowings and Debt Servicing Scenario: Are There Reasons to be Concerned?” organized by CPD in partnership with The Asia Foundation – Bangladesh, Dr. Debapriya shed light on the complexities of Bangladesh's debt structure. The event took place in a hotel in Gulshan, Dhaka, with Prime Minister's economic adviser Dr. Mashiur Rahman as the chief guest.
Dr Salehuddin Ahmed, former governor of Bangladesh Bank; Dr. Fahmida Khatun, Executive Director of CPD; Kazi Faisal Bin Seraj, Country Representative, The Asia Foundation—Bangladesh; Kamran T Rahman, President, Metropolitan Chamber of Commerce and Industry (MCCI), among others, spoke at the event.
Dr. Debapriya emphasized the gravity of the situation, stating, "34 percent of Bangladesh's revenue expenditure till July has been allocated to debt repayment." This figure, he noted, includes 28 percent for domestic debt and 5 percent for foreign debt, marking a significant increase from 26 percent to 34 percent in just three years.
All but AL want to end capacity payments in power sector: CPD
The acceleration of borrowing trends since 2018-19, attributed to the Covid-19 pandemic and the Russia-Ukraine war, has raised concerns about Bangladesh's debt servicing capacity. The revenue budget is now so stretched that it cannot finance a single penny for development projects, he highlighted.
Reflecting on the broader implications of debt repayment, Dr. Debapriya criticized the dismissive attitude of policymakers towards economists' warnings. He recounted his own predictions made two years ago about the challenges facing Bangladesh in 2024, emphasizing the anticipated discomfort in debt repayment starting from 2025 and escalating in 2026.
Bangladesh needs to introduce social insurance for all, not social safety net: CPD
He also pointed out the significance of private sector debt, noting that government loans account for 80 percent of total borrowing, with the private sector comprising the remaining 20 percent. He stressed the impact of private-sector loans on the country's liability and exchange sector, calling for greater scrutiny of personal loans and their utilization, whether domestically or abroad.
Combining foreign and domestic debts, Dr. Bhattacharya underscored the burden of per capita liability, which stands at $310 for foreign debt alone and escalates to approximately $850 when domestic debt is factored in. This comprehensive analysis of Bangladesh's debt scenario underscores the urgent need for fiscal prudence and strategic planning to navigate the challenges ahead.
BDBL to merge with Sonali Bank while BKB with RKUB
State-run Bangladesh Development Bank is set to merge with Sonali Bank, while Rajshahi Krishi Unnayan Bank will be taken over by Bangladesh Krishi Bank as part of disciplining the banking sector.
The move follows the merger of private sector Padma Bank with Exim Bank.
The primary decision of latest merger of banks was taken at a meeting between Bangladesh Bank (BB) governor Abdur Rouf Talukder and the managing directors of the respective banks at the BB headquarters on Wednesday.
A deal will be signed on Monday (April 8) between Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank at BB in this regard.
Md Shawkat Ali Khan, managing director of BKB told UNB that the central bank called a meeting with the chairmen of both banks and discussed the overall situation of the banks.
On the merger of state-owned banks, on behalf of the government the BB will take a final decision regarding the merger issue, he said.
However, the BB official confirmed that a deal signing between BKB and RKUB is scheduled to be held on Monday.
The government took the decision in principle to merge BDBL with Sonali Bank. But it will take some time to reach a deal between Sonali Bank and BDBL, said an official of BB.
Grameenphone ensures robust network re-engineering for Eid commutes
Grameenphone, the smart connectivity provider in the country, is all geared up to ensure uninterrupted connectivity for its customers ahead of the Eid-ul-Fitr celebrations.
With a steadfast commitment to delivering superior customer experience, Grameenphone has implemented cutting-edge data and AI-driven solutions to optimize its network performance, solidifying its position as the No.1 network provider in the country.
Grameenphone's relentless pursuit of innovation and customer-centricity remains at the core of its mission to connect people to what matters most to them.
To ensure seamless connectivity during the joyful occasion of Eid, the company has implemented a dynamic capacity setup to enhance lives.
This setup enables proactive decision-making driven by AI, leveraging forecasts of people's movements and usage needs.
By anticipating and meeting customer demands effectively, Grameenphone provides uninterrupted services and an enhanced experience, whether in bustling cities or the remotest areas.
Harnessing the power of data and AI-driven decision-making, Grameenphone has designed its network solutions to deliver a seamless data and voice experience.
Mohammad Sajjad Hasib, Chief Marketing Officer, Grameenphone, said, “At Grameenphone, our driving force lies in empowering communities through the transformative power of connectivity. We are unwavering in our commitment to delivering an unparalleled customer experience. With advanced AI technology, a robust infrastructure, and a customer-centric approach, Grameenphone is dedicated to providing uninterrupted data and voice services during the festive season, enabling customers to stay connected and share the joy of Ramadan and Eid with their loved ones. With steadfast focus on modernization, superior technology, and investment into building a future-ready network, Grameenphone is ensuring superior customer service and strengthening our position as the No.1 network provider. We are working towards our vision of a Smart Bangladesh, where connectivity is the cornerstone of progress."
Furthermore, in preparation for the festivities, Grameenphone has identified hotspots across the country where additional capacity enhancements are necessary. Through strategic resource allocation, Grameenphone aims to provide enhanced network coverage in areas like shopping malls, highways, and transport hubs, ensuring a smooth customer experience. This ensures that customers can rely on Grameenphone’s robust network infrastructure, even during peak times.
Recognizing that weather conditions can sometimes pose challenges to network performance, Grameenphone has factored it in to preemptively address any potential disruptions and minimize impact on customer experience. This proactive approach and preparedness demonstrate Grameenphone's commitment to maintaining a resilient and uninterrupted network service, ensuring ease and comfort for Eid commutes.
Metro rail journey to get costlier as 15% VAT to be imposed from July
Metro rail passengers will have to bear additional cost as the National Board of Revenue (NBR) is going to impose 15 percent VAT on its tickets from July 1.
There is currently a VAT waiver on Metrorail tickets, which will expire on June 30. DMTCL requested NBR to extend the period but the revenue board expressed unwillingness to extend the exemption period.
The second secretary of NBR's VAT Division Barrister Md. Badruzzaman Munshi sent a letter to the managing director of Dhaka Mass Transit Company Limited (DMTCL) in this regard.
According to the letter, VAT exemption on metro rail tickets will expire on June 30.
In the letter, the revenue board said that various development activities are going on in the country with the goal of attaining the status of developed country by 2041.
The government has to constantly provide money to carry out those development activities, which is mainly collected through direct and indirect taxes.
Tax exemptions are given to various sectors on different occasion with the aim of promoting domestic industries, reduce import dependence and developing small and cottage industries, etc, said the letter.
That is why tax exemption benefits are being gradually withdrawn from various sectors.
Besides, freedom fighters and children of three feet height can travel free of charge, and people with special needs can travel on metro rail at a 10 to 15 percent discount.
Shabab Choudhury appointed BATB’s Corporate and Regulatory Affairs Head
BAT Bangladesh has appointed Shabab Ahmed Choudhury as the Head of Corporate and Regulatory Affairs, with effect from April 1, 2024.
In his 15 years at BAT Group, he has served in key positions across multiple countries, including the UK, Pakistan, Indonesia, Papua New Guinea, and Bangladesh. Most recently, he has performed the role of Head of Commercial Finance-DBS based in the UK.
Shabab joined BAT Bangladesh as a Finance Management Trainee in 2009. He obtained a Bachelor of Business Administration degree from North South University.
His inclusion to the BAT Bangladesh leadership team is expected to add value as he brings with him cross-market knowledge and commercial acumen.
"I'm honoured to rejoin BAT Bangladesh. With a 114 years’ legacy, our company has been supporting the government as a partner in the country’s development journey,” he said, reiterating the company’s commitment to working for ‘A Better Tomorrow for all’.
Aziz Khan: Lone Bangladeshi tycoon on Forbes Billionaires List 2024
Muhammed Aziz Khan, the visionary chairman of the Bangladeshi conglomerate Summit Group, has earned a spot on the prestigious Forbes World's Billionaires List for 2024.
Residing in Singapore, Khan is celebrated as the sole Bangladeshi entrepreneur to be featured on this year's list, a testament to his remarkable success and influence in the global business arena.
Khan's inclusion in the Forbes list is a recognition of his substantial contributions to Bangladesh's economy through Summit Group. The conglomerate has made significant strides in various sectors, including power generation, port management, fiber optics, and real estate, under Khan's strategic guidance, according to Forbes.
A testament to his business savvy was the lucrative sale of a 22% stake in Summit Power International to Japan's JERA for $330 million in 2019, which placed the company's valuation at an impressive $1.5 billion.
In a move that underscores the family's commitment to their business legacy, Khan's daughter, Ayesha, has taken the helm at Summit Power International, continuing the path of innovation and growth set by her father.
Globally, Khan is ranked 2545th among the world's billionaires, while in Singapore, where he has made his home, he stands as the 41st wealthiest individual, as per the 2023 Forbes list.
His journey from an ambitious student with an MBA from the University of Dhaka to a global business figure is an inspiring story of determination and skill.
At 69, Khan remains a pivotal figure in the business world, actively shaping the economic narrative in Bangladesh and beyond. His achievements not only reflect his personal success but also highlight the potential of Bangladeshi entrepreneurship on the world stage.
Bangladesh Bank auctions gold for the first time in 16 years
Bangladesh Bank (BB) for the first time in 16 years, auctioned 25 KG (kilogrammes) of gold for around Tk18 crore on Wednesday.
The central bank was keen to auction the gold in late 2022 but failed to find the expected buyers.
Bangladesh Bank issues detailed directive on appointment of MD, CEO for NBFIs
"Bangladesh Bank sold 25.312 kg of gold in different qualities for Tk17.99 crore. After completing all the processes on Wednesday, these golds were handed over to the buyer company, Venus Jewellers," said Mezbaul Haque, spokesperson of the cenral bank.
Bangladesh Bank sets qualifications of independent directors for NBFIs
The Bangladesh Bank last sold 21.822 kg of gold through auction on July 23, 2008. Moreover, another 25, 21, and 20 kg of gold were sold in three phases earlier that year.
Bangladesh Bank closing around 200 MFS accounts a day in Hundi crackdown: Governor Abdur Rouf
IMF stresses meeting forex reserves target to get third tranche of $4.7 billion loan
The International Monetary Fund (IMF) has emphasised meeting the target of the foreign exchange reserve set for March 2024 as a condition of $4.7 billion in loan support for Bangladesh.
The global lender upheld its stand during a meeting with Bangladesh Bank officials on Wednesday. The IMF team is visiting Bangladesh to assess the financial outlook before releasing the third installment of the $4.7 billion loan.
IMF approves 600 mln USD funding to support Ghana's economic recovery
As per the conditions of the loan from the IMF, it was set as a target to hold US$19.26 billion in reserves in March 2024. But actual reserves are less than $16 billion.
“There is difficulty and uncertainty about the third installment of the IMF loan as the IMF has been somewhat strict in meeting the conditions,” said an official of the central bank.
Despite relaxed conditions, Bangladesh couldn’t meet IMF’s forex reserves target in 2023
He told UNB that the Bangladesh Bank officials have given several points for causing the reserve shortage. He hoped the IMF would finally be convinced of Bangladesh's position in this regard.
The government signed a $4.7 billion loan deal with the IMF to solve the dollar crisis. A review mission of the IMF is visiting Bangladesh before the third installment of the loan is disbursed.
After receiving 2nd tranche, Bangladesh’s reserves hike up above $20 billion as per IMF: BB
Dr Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh (PRI), told UNB that despite the IMF easing the net reserve requirements, it is difficult for Bangladesh to meet the March target.
He said the global lender may set a new standard of net reserves for Bangladesh or delay the disbursement of the third tranche of the $4.7 billion loan.
Govt to import 3 cargoes of LNG to raise gas supply
The government will import 3 cargoes of liquefied natural gas (LNG) as part of its move to raise the gas supply to meet the growing demand.
Cabinet Committee on Government Purchase (CCGP) in a meeting approved three separate proposals of state-owned Petrobangla.
Finance Minister Abul Hassan Mahmood Ali presided over the meeting while the Energy and Mineral Resources Division moved the proposals under the Speedy Increase of the Supply of Power and Energy Act, 2010, on behalf of its subordinate body.
As per the proposals, Switzerland-based Total Energy and Power Ltd will supply an LNG cargo at a cost of Tk 427.77 crore with each unit at $9.89 while Singapore-based Gunvor Group will supply an LNG cargo at a cost of Tk 410.65 crore with each unit at $9.65.
The remaining LNG cargo will be supplied by Vitol Asia (Pte) Ltd, Singapore at a cost of Tk 418.59 crore with each unit LNG at $9.68.