‘Agriculture, RMG, remittance lead to economic recovery’

Executive Director of Ahsan H Mansur on Tuesday said Bangladesh has recovered from the Covid-induced economic fallout riding on boosted agricultural and industrial production, services activities, exports and remittances.

“Economic activities gradually started getting pace in late 2020 and in much of 2021. The annual GDP growth which dipped to 3.45 per cent in FY20 rose modestly to 5.4 per cent in FY21. Agriculture, RMG export and remittance inflow – all played a vital role in economic recovery,” he said at virtual meeting organised by the Policy Research Institute in Dhaka yesterday.

Mansur observed that the growth is still driven by investment rather than consumption. The economy’s capital-output ratio works out to 4.5 so that to achieve the targeted growth rate of 7-7.5 per cent, the economy needs investment-GDP ratio of 31.5 per cent or more.

“We have faced two waves of coronavirus in the country. The economic recovery which is underway comes on the heels of private sector credit growth since the start of 2021,” he held.

The country has performed the best in terms of economic growth among its neighbours amid the pandemic because of the time-befitting steps by the government, Planning Minister MA Mannan has said.

“Our economic growth was down to 5.5 per cent from over 8 per cent during the start of Covid-19 pandemic in the last fiscal year. But we have recovered it now and is much better positioned,” he said.

Bangladesh has successful economic growth that hinges on three pillars which are remittance, RMG and agriculture, he said, adding, “So, its economy did not fall during the Covid-19 period.”

During the nationwide lockdown, the government kept RMG industries open and allowed transportation of agricultural products across the country.

SANEM Research Director Sayema Haque Bidisha said: “We should recognize the extraordinary contribution being made by the agriculture sector during the trying time of the pandemic.

The country did not face any shortage of food during the crisis period because of the government bold steps, she maintained, observing that now Omicron is spreading all over the world, and the government should face it with previous experience.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Faruque Hasan said only the RMG sector contributed to the country’s GDP successfully during the pandemic.

“The ready-made garment industries are making a very impressive contribution to maintaining the growth sustainable. Our RMG export declined slightly due to disruption to supply chain but we recovered it successfully,” he added.

According to former BKMEA president Fazlul Haque, industries were running at below 15 per cent capacity in terms of human resources during the pandemic period.

Taking the floor for discussion, Foreign Investors Chamber of Commerce and Industry president Naser Ezaz Bijoy said economic zones can play a vital role in promoting and sustaining growth. Only this sector can attract millions of dollars of Foreign Direct Investment (FDI) and local investment for developing the country.

He suggested that a proper implementation of the government’s 8th Five year plan will help recover the damages done to the economy during the pandemic.

Chairman of PRI Zaidi Sattar presented the keynote paper.