Apart from managing finances from different sources, mapping and implementing the right combination of policies are imperative to restore macroeconomic stability in Bangladesh, Dr Ahsan H Mansur said on Thursday.
Referring to a $4.5-billion IMF loan deal, the Policy Research Institute of Bangladesh (PRI) executive director said the move would encourage businesses from home and abroad.
"I congratulate the government for its timely initiative to start the dialogue with the International Monetary Fund (IMF), though the contents of the policy package are yet to come public."
Dr Mansur said these at a meeting styled 'Current Economic Situation Worldwide: Challenges & Action Plans' hosted by the France Bangladesh Chamber of Commerce & Industry (CCIFB) at a city hotel.
Bangladesh Investment Development Authority (BIDA) executive chairman Lokman Hossain Miah addressed the event as the chief guest, with CCIFB president Md Shafquat Matin in the chair.
French Embassy chargé d'affaires Guillaume Audren de Kerdrel, PRI chairman Dr Zaidi Sattar, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) vice-president Md Shahidullah Azim, Anwar Group managing director Hossain Khaled, and CCIFB vice-president MA Reaz also spoke.
Citing that both sides (government and IMF) are agreed on a set of policies to be supported by IMF resources, Dr Mansur said the development hopefully also pave the way for getting supplementary resources from World Bank, Asian Development Bank and Japan.
However, he said, "It is not the money that is important for Bangladesh, but the right combination of policies which is more important."
Explaining the thought, Dr Mansur said, "Every month, we're losing $1.2-1.3 billion from the reserve, which means, the money to be given by IMF, $1.5 billion in the first year, will go down in one month."
Money alone will not solve the problem, it is the policies which will, he said, suggesting that the government, backed by IMF support, sincerely implement the policies while it will need support from representatives of the industries, business community and others.
The expert said Bangladesh has not fallen into severe crisis yet as the government has taken some timely initiatives early, unlike Sri Lanka and others.
"We have secured some financing and policy packages, which we don't know yet, but knowing IMF I hope they have put in place some safeguards to make the situation more stable," he added.
Dr Mansur also called for a unified foreign-exchange rate to stabilise the market and prevent further depreciation of taka.
India has been devaluating rupee slowly for last four to five years while Bangladesh depreciated taka against dollar by 25 per cent in a short time, giving a big shock to many sectors.
Besides, the economist emphasised increasing the tax-GDP ratio to 9.5 per cent as soon as possible from existing 8.5 per cent.
Meanwhile, Dr Sattar said Covid-19 and the Russia-Ukraine war have created the situation for a new global political order, which has disrupted the global supply chain and cooled down hyper-globalisation.
The persisting situation has accelerated the rise of protectionism globally, which means national economy is now getting more priority than before harming the basic concept of globalisation, he said.
Dr Sattar said the strict zero-Covid policy of China has created crisis global production scene which, by the way, can be a good opportunity for Bangladesh if it can grab the chance carefully.
"Many western companies have said in terms of ready-made garment (RMG) sourcing, Bangladesh is number one in their list which indicates that orders will increase as soon as the Russia-Ukraine conflict eases."
However, BGMEA vice-president said export orders from European Union countries, where 60 per cent of Bangladesh's RMG products are shipped, has been dropping amid global economic meltdown.
Under the circumstances, Bangladeshi RMG makers are now exploring Asian markets, which is home to some 3.0-billion people, he said, adding that RMG export to India saw 92-per cent growth last year.
Mr Khaled said it is time to focus on cost-cutting, prioritising on efficiencies of factories, ports and other sectors to optimise local resources.
The former DCCI president also stressed simplification of policies and services related to export and import.
Urging all to work together, he said, "We must not panic, I see a lot of people are talking about taking money out of the country as they are not feeling secure."
Meanwhile, BIDA executive chairman said BIDA now provides over 150 types of services to businesses through its one-stop service (OSS) in shortest possible time, preferably within 24 hours.
