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Dhaka Chamber of Commerce and Industry (DCCI) President Ashraf Ahmed has said that maintaining the growth in private sector credit will be the biggest challenge in the current year as the working capital demand has increased by 30-40 per cent and taka depreciated against dollar.
“In this situation, meeting the current capital demand will be a big challenge as the central bank has set a target of only 10 per cent private sector credit growth. If this problem cannot be resolved, costs must be reduced which will affects production,” he said.
“Lower production will impact growth. Employment will also shrink. We are working with the government to increase credit flow. It is possible to keep the economy dynamic,” Ashraf made the observations while speaking at ‘CMJF Talk’ organised by Capital Market Journalists Forum (CMJF) at its office in Dhaka on Tuesday.
CMJF General Secretary Abu Ali moderated the event where CMJF President Golam Samdani Bhuiyan gave the welcome speech.
The DCCI president said that Bangladesh will be a trillion-dollar economy country by 2030. “To achieve this goal, the size of the economy should be increased 2.5 times. A lot of things need to be done to attain this goal.
“Our economy and the world economy have gone through many challenges in last 1.5-2 years. Mainly, the problem of inflation has gone through. It was supposed to be done in ten years but due to Covid, we are now four years behind. The work of 10 years now has to be done in six years.”
He continued, “There is a dollar crisis in the country now. Banks do not have enough dollar liquidity. That is why the import problem is not being solved. A decrease in imports has a major impact on production.”
In reply to a query about capital collection from the capital market, the DCCI chief said that it is very difficult to take a long-term loan from the bank. “It is not in the capital market. You can raise money for 5 years and 10 years by issuing bonds. You can sell it whenever you want.”
He said raising capital from capital markets is a bit time-consuming. It will not work immediately. It can be worked on in the long run. An audit report is mandatory.
Regarding taking various initiatives in this regard, he said, “Bringing good issuers to the capital market is necessary. We are trying to take several steps in this regard. Good issuers can come in both bonds and fixed deposits. In the bond market primary is traded but secondary is not. We have to increase our investment by bringing in issuers.”
In response to another question, the DCCI president said that money laundering is not only for economic reasons. “Money flows there where return is more. It is not the case that returns are higher if you invest outside the country. Rather, investing in the country yields higher returns than that. So, money laundering is not for economic reasons. There may be other reasons.”
Ashraf Ahmed said, “The businessmen who are involved in money laundering or any other irregularities are solely responsible. Therefore, the responsibility of any one trader does not fall on all traders. We can work with the government on various policies.”
He said many new sectors are coming. For example, if the capacity of Smart Bangladesh Vision is increased, it can become a trillion-dollar economy. If intellectual property rights are not retained, it will not be possible to develop knowledge-based properties.
Regarding various obstacles to the development of the country and their elimination, he said that traffic congestion is seriously hindering business in old Dhaka. So, easing traffic congestion is very important for traders.
To get trade licence, he said, one has to go door-to-door which can be done through one-stop service. “For this, awareness should be increased among local traders.”
