Political harmony needed to achieve GDP target: MCCI

Political harmony should be maintained in the country to achieve the government’s economic growth and inflation targets, said the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI) yesterday.

It said adequate infrastructure, energy, policy continuity, skilled manpower, political stability and investment-friendly climate are the key factors for higher economic growth. “It is assumed that the peaceful political situation that currently prevails will continue in the coming days. Therefore, export, import, and remittances can be expected to increase.” The oldest chamber of the country made the observation in its review of the economic situation for October-December 2017. It said the overall economic situation in the country was positive in the quarter under review as indicated by steady improvements in the major economic indicators. “The economic system is progressing well regardless of the presence of some danger elements such as marginal boom in remittances, slower boom in the export receipts, and a greater price of inflation.”

The country, however, skilled secure financial growth. Inflation, even though a bit higher, used to be below control, and the change rate remained nearly stable. Foreign change reserves rose to a relaxed level. During the July‐December period, the agriculture zone performed well, but non-stop government aid with inputs and finance will be wished to sustain the sector’s growth.

Infrastructure deficits and gasoline and energy grant issues had been undermining the performance of the manufacturing as properly as the agriculture sector, said the review. “The authorities will, therefore, need to undertake appropriate measures to get rid of these bottlenecks in order to aid the boom of these two essential sectors.”

The chamber stated the offerings region is doing well, but it will additionally need aid in unique areas. The overseas trade reserve will relatively fall in January and March and it is a everyday annual phenomenon as the government makes repayments to the Asian Clearing Union against imports. The rate of inflation is, however, probably to go up from January because of the in all likelihood rise in some fundamental commodities, consisting of gas oil, stated the chamber. The MCCI stated the government wants to improve the country’s street and rail infrastructure, advance port facilities, expand strength and gasoline production, and do away with different infrastructure bottlenecks to obtain quicker economic growth.

At the same time, impediments such as the lengthen in execution of improvement projects, lack of professional manpower and insufficiency of industrial land ought to be removed to fix the self belief of the country’s business and investor community. “There are additionally the challenges of rising geopolitical tensions and the Rohingya refugee crisis that will want to be met.” The chamber stated Bangladesh ought to focus on new and emerging markets such as China and Japan. Product upgradation is a have to for a higher price. About the flow of overseas direct investment, the chamber stated the FDI influx to Bangladesh is low in contrast to many countries at a comparable stage in development.

Bangladesh’s low labour costs are generally believed to be captivating to foreign investors, however they still hesitate to make sparkling investments because of the country’s underdeveloped infrastructure, political uncertainty, and other impediments. “The government wishes to address these impediments to attract more FDI.” The review said the real estate, renting and business activities performed better in FY2016-17 compared to 4.47 percent in FY2015-16. In spite of the tremendous potential of the sector, factors such as land value distortion and absence of a secondary property market adversely affected its development.

The real estate business has of late seen some improvement thanks to property price corrections and falling interest rates on home loans, according to the chamber.