United News of Bangladesh

Finance Adviser Dr Salehuddin Ahmed on Tuesday outlined the key economic challenges the next government will face, stressing the need for revitalising trade and industry, generating employment and strengthening financial sector institutions. “If business does not expand, employment will not come. Without employment, people’s purchasing power will remain weak. This is one of the biggest challenges,” he said. Talking to reporters after the purchase committee meeting, he said one of the main challenges would be to revitalise business and industrial activities, as job creation depends on a vibrant private sector. He said Bangladesh still has a relatively small industrial base and remains heavily dependent on exports.  “Bangladesh cannot become another Hong Kong or Singapore. We need to build our own industrial strength, especially small and medium industries.” Dr Salehuddin said inflation continues to be a concern and cannot be tackled by monetary policy alone.  “Inflation is a multidimensional issue. We have tried to address it, but it needs broader measures.” On the banking sector, he said steps have been taken to reorganise it, but more difficult decisions lie ahead, and praised the central bank governor’s recent initiatives, though he acknowledged these were not enough.  “Credit supply is still limited and confidence has not fully returned, although deposits have started to increase recently.” Dr Salehuddin also highlighted the need to develop the capital market to reduce excessive dependence on banks for business financing.  “If we fail to develop the capital market, business and trade will not grow relying only on banks. Equity participation through the stock market and a strong bond market, especially for the private sector, are essential,” he said, noting that regulatory reforms face legal hurdles and court challenges. The adviser described the insurance sector as another sensitive area that needs improvement, saying efforts have been made but progress remains limited. Bangladesh economy stable despite challenges: Finance Adviser Dr Salehuddin further identified energy as a major long-term challenge, stressing the importance of increasing domestic exploration.  “We need more drilling, including offshore. At the same time, we have not been able to develop solar energy to the extent needed,” he said.