Businesses end up paying for pandemic mismanagement: Survey

A recent survey has concluded that weak handling of the coronavirus pandemic is causing a significant rise in business costs in the country.

The survey revealed the current business environment in Bangladesh as the coronavirus restrictions are waning down.

The survey was jointly conducted by South Asian Network on Economic Modelling (SANEM), a private research organization, and The Asia Foundation. Dr Selim Raihan, leading economist and Executive Director of SANEM, led the survey team.

Since the spread of the deadly coronavirus, Bangladesh's trade has stagnated along with other countries. Yet, activities of several industries and services including export, daily commodities and medicines must be kept active on an emergency basis.

The government has taken precautionary measures to prevent a large-scale fallout induced by the Covid-19 pandemic. Economic activity has already been largely stimulated by the government measures amid coronavirus pandemic.

However, these initiatives need to be distributed fairly among all sectors and there are also weaknesses in management. And, it is costly. Entrepreneurs are paying the price of these weaknesses.

According to the survey, the business costs of entrepreneurs in the country are increasing due to the weak management of coronavirus infection prevention.

70 per cent of the country's entrepreneurs agreed with the main survey question, 30 per cent of the entrepreneurs, however, did not.

The survey was conducted on 303 entrepreneurs from 22 districts of the country. It was conducted on the impact of the coronavirus pandemic on the business environment, incentive packages and more.

The survey highlighted the top 10 challenges in increasing business costs in recent times. These are corruption, port and customs services in trade, the crisis in Covid-19 management, government support to industry, overall tax system, easy access to financing, business registration, quality of transport services, adequacy of skilled workers and power supply.

The survey results
A total of 88 per cent of entrepreneurs think corruption is one of the key challenges of doing business. In other words, they believe the development of the business sector in the country is being hampered due to corruption.

71 per cent of entrepreneurs think port and customs services are not good enough for trade while 29 per cent think these services are optimal.

65 per cent of entrepreneurs think that the government's support for the industrial sector is not enough while 35 per cent think the support is sufficient.

62 per cent say the overall revenue situation is counterproductive, the rest think it is favourable.

59 per cent of entrepreneurs believe access to finance is not enough and the flow of money in this sector should be made more readily available. 41 per cent think otherwise.

There are many complexities and time constraints in business registration. Only 51 per cent of entrepreneurs think that government services in this sector are not conducive to trade development. However, 37 per cent of entrepreneurs disagreed. They think that government service is favourable in this aspect.

Besides, 49 per cent think the transportation system is unfavourable for businesses and 51 per cent think it is favourable.

Surprisingly, only 36 per cent of entrepreneurs think there is not enough skilled manpower while the rest think otherwise.

29 per cent of the entrepreneurs think the overall situation in terms of power supply and connection is unfavourable for trade development.

In this regard, BKMEA co-president Mohammad Hatem said the pandemic is forcing them to spend extra to follow the hygiene rules.

"Apart from this, additional expenses are being incurred in various sectors including transportation and port services. This is increasing business costs. Bangladesh's capacity in the international market is declining due to rising business costs," he said.

"In order to survive in the tough competition which is, currently, taking place all over the world, we must increase our ability to compete. The only way to do so is by reducing business expenses," he added.

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