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The United States uses its trade embargo tool out of its political interest and if sanctions are imposed on Bangladesh, it will not happen because of Bangladesh’s internal political situation but to serve the US’s political agenda, economist Mustafizur Rahman has said.
If Bangladesh shows reluctance on reforms, the US trade sanctions will intensify, he said on Tuesday, urging authorities concerned to close the door on possible opportunities of trade restrictions with necessary reforms, including the ones in the labour sector.
Prof Mustafizur, a Distinguished Fellow of the Centre for Policy Dialogue (CPD), made the observations at an event, titled ‘Conversation with Professor Mustafizur Rahman', organised by the Economic Reporters Forum (ERF) in Dhaka.
ERF General Secretary Abul Kashem moderated the programme while ERF President Refayet Ullah Mirdha gave the opening speech.
Mustafizur said that the US may talk about various pressures on Bangladesh due to its relations with China. “They do it out of necessity. They imposed sanctions on Venezuela a few days ago.”
When asked whether trade sanctions would come, he said that it was hard to predict. “What is more important than sanctions the US can impose is the kind of protection we can provide to our workers. It is difficult to say what the US will do.”
“We negotiate with our workers on various issues including trade union rights. They can be resolved through negotiation. The more relaxed we are in these matters, the more opportunities for the US will increase,” he said.
Mustafizur also emphasised tax evasion-free revenue management and more market-based foreign exchange rates and bank interest rates for building a strong and balanced economic system in the country.
He suggested the implementation of a bold reform programme for a loan-defaulter-free banking system. "Implementation of such a programme may face some difficulties in the initial stage but we need to do this for a strong and balanced economy.”
He said it is necessary not only to accept the reform programme but also to implement it. "We have very good laws. So, why are tax evaders and loan defaulters being created in the country?"
Three important reforms including implementation of the financial act, exchange rate reforms and interest rate are needed to restore the balance of the economy within one or two years although the reforms would be painful, he noted.
Bangladesh has a good set of financial and banking laws but implementation of those laws is a major challenge although they need to be implemented for establishing good governance in the banking sector, he added.
Mustafizur urged the authorities concerned to make the exchange rate fully market-based to increase both export and remittance earnings, which will help strengthen the country's foreign exchange reserves.
Expressing his expectation that the Special Economic Zones (SEZs) will be a tool for the country's economic transformation, the eminent economist said one-stop service can be a tool of the SEZs for the economic transformation of Bangladesh.
He mentioned that the positive policies of the government have a special role in the progress of the readymade garment industry.
However, he urged to ensure product diversification and labour-related compliance in the garment industry for sustainable development of this industry.
The CPD fellow also said that the government and the Anti-Corruption Commission (ACC) should investigate how the assets of MPs have increased manifold.
“I was surprised to see the rate of increase in wealth in the affidavits of the candidates in the 12th parliament elections. Where a plot of land costs Tk 1 crore; shown Tk 1 lakh,” he said.
“Even then, wealth increases hundreds of times, then what is the real picture? Seeing this, it is not clear how much wealth has actually increased,” he wondered.
He said that in the affidavit of the candidates, the properties of many have increased hundreds of times. It is interesting to see how such a huge amount of wealth has grown in such a short time.
“Those properties have increased so much, the government and their party should ask to know the source of these properties. At the same time, the ACC and the Bangladesh Financial Intelligence Unit should find the source of their assets,” he said.
