Coping with the global economic turmoil would have been easier through strengthening of the government institutions, better coordination among ministries, effective implementation of monetary policy tools, and good governance, observed leading economists and journalists.
Soaring prices of commodities after the price hike in the global market has put the poor, lower middle class and fixed income people in extreme distress, they said at a roundtable organised by the Editors' Guild, an association that promotes responsible journalism.
"Before we could recover from the coronavirus pandemic, the Russia-Ukraine war intensified the crisis and as a result the overall economy of Bangladesh has been under a pressure like never before in 13-14 years," Syed Ishtiaq Reza, editor-in-chief, Global Television said in the opening remarks at the event, moderated by the Editors' Guild President Mozammel Babu.
He also said that the current global situation has put strain on the forex reserve of the country.
Ishtiaq Reza recommended speedy completion of the government project in a cost-effective manner within the deadlines. He also advised not to go for any project without proper estimation of earnings and debt pressure.
Ahmad Kaikaus, principal secretary to the Prime Minister said to take advantage of the free market economy, one has to tolerate some of its downsides.
He also said there are some problems in our market, some malpractices have also taken place in the banking sector.
Kaikaus pointed out that the price of dollars is decreasing thanks to the government's initiatives.
Explaining the rationale for the increase in oil prices, he said, "West Bengal has a per capita income of $2,100, compared to $2,800 in Bangladesh. If the per capita income in Bangladesh is high, why will the price of diesel be low?"
He also said inflation was expected to rise from 0.6% to 0.7% if oil prices rise and added the cost of goods has increased due to traders.
Abu Hena Rahmatul Muneem, chairman of the National Board of Revenue, termed the war between Russia and Ukraine as a game and said, "Such games will continue. To survive in this game, emphasis must be placed on the internal market, internal production and internal food security."
Responding to economists' remarks about the weakness in revenue collection, he said that although the corporate tax rate has been reduced for the past few years, the amount of tax collection is increasing.
"But NBR does not have the manpower and money to go to the field for direct tax collection. Digitisation and automation will be the solution to this problem," he said.
Ahsan H Mansur, executive director of Policy Research Institute, said, "A comprehensive estimate of tax expenditure is needed. We need to assess how much tax waiver is given to which sector and whether these are reasonable or not."
Commenting that the pace of Bangladesh's economy will not be like that of Sri Lanka, he said, Bangladesh's economic fundamentals are stronger.
However, he also said that the monetary policy could not be utilised due to fixing the interest rate.
Professor Mostafizur Rahman, distinguished fellow at the Centre for Policy Dialogue, said that one-third of the total size of the economy is dependent on imports and exports, so the instability in the world market affects the country as well. However, global shocks could have been dealt somewhat better if resilience was ensured in internal management.
He said the currency was overvalued for several years, which needed to be devalued long ago.
He also said that if the Competition Commission was utilised, the Competition Act was used and the consumer department was strengthened, syndication of the market could have been stopped.
Federation of Bangladesh Chambers of Commerce & Industries President Jasim Uddin said as almost all raw materials of the industries are import-dependent, the price increase in the world market affects the country.
Syed Abu Naser Bukhtear Ahmed, former managing director of Agrani Bank, said, what the banks have done with the dollar price is a crime.
Mozammel Babu said those involved in the stock market crash in 1996 could be identified but could not be punished due to the absence of law.
"Will the manipulators of the dollar market also go unpunished," he asked.
Inam Ahmed, editor of The Business Standard said, if good governance was ensured, this crisis could have been dealt with more easily.
"After the increase in oil prices, the prices of other products have increased several times more than expected," he said, adding that lack of good governance and oversight could be the reasons behind it.
He observed that only expatriate income can play an important role in increasing the forex reserves at this time.
The money expatriates send home adds 100% value to the economy, he said.
"Unfortunately, nothing is done for them [expats]. They face harassment in every step of the way – from getting their passports to going through the immigration," added Inam Ahmed.