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The Financial Express

Weathering virus impact: MCCI suggests creating Tk 1.0 trillion fund

 FE REPORT | Published: April 03, 2020 08:05:29 | Updated: April 03, 2020 10:07:29


Weathering virus impact: MCCI suggests creating Tk 1.0tn fund

An elite chamber on Thursday proposed the government to form a fund of Tk 1.0 trillion to help minimise economic losses as a result of Covid-19 outbreak.

The Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI) said the Bangladesh Bank may set up such a fund by getting financial assistance from development partners, including the World Bank, the Asian Development Bank and other agencies.

The MCCI estimated the country's economy now needs money flow equivalent to US$ 2.0-3.0 billion and the central bank has to adopt immediate step as the situation evolves.

In a statement to the media, the MCCI placed the proposal for mitigating the effects of the new coronavirus pandemic on the economy.

The coronavirus originated in China in late last year and has so far infected nearly 1.0 million people globally, including 56 in Bangladesh, as of Thursday.

The MCCI said that the government should postpone realising value added tax, or VAT, and the advance income tax from the businesses as the enterprises have been experiencing sluggishness induced by the virus attack.

It proposed that the enhanced utility tariffs imposed over the past six months should be halted considering the adverse impact on the people and the enterprises.

The MCCI said Bangladesh Bank has extended loan classification period up to June 30 next. It opined that it should be extended by more six months.

It said that liquidity should be boosted in the banking channel to ensure loan facilities for all types of businesses.

The impact on the self-employed persons should be considered as they are vulnerable to the current situation.

"The repayment period of such loans to the businesses and the self-employed persons should be extended for a period of five years," the MCCI said.

The MCCI suggested the repo rate should be slashed to 4.0 per cent from the existing 6.0 per cent.

It also said the tax rate should be slashed in the wake of the pandemic. This may be applied to individuals as well to establishments.

"The tax realisation from people and organisations should be suspended for a period six months," it noted.

It noted that money can be devalued against the US dollar as many studies suggest that such type of depreciation may boost the welfare of the society in the long run.

The MCCI has prepared the proposals in consultation with 11 other organisations.

The statement signed jointly by Nihad Kabir, president at the MCCI and Kamran T Rahman, president at the Bangladesh Employers' Federation, said that the government should take stern measures to enforce the home quarantine aimed at slowing spread of the deadly virus.

jasimharoon@yahoo.com

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