Photo : Messenger
Since mid-2022, the country has faced significant economic challenges, particularly due to inflation and a dollar crisis stemming from the Russia-Ukraine war. Additionally, the pressure of repaying foreign loans has further strained the economy. As a result, the government has implemented measures to control imports of heavy machinery and capital goods, which has already slowed business activity.
Moreover, the economy has come to a standstill due to violence, internet blackouts, and curfews caused by the quota reform movement. Experts believe that the impact of this massive disruption and internet shutdowns will be greater than the previous economic crises the country faced. According to one estimate, Bangladesh has lost about one billion dollars per day during these five consecutive days of instability.
Only garment sector lost Tk 16,000 crore in ten days violence and the power sector lost Tk 1,000 crore which will require more Tk 1,000 crore to repair. Foreign buyers are very reluctant to receive the consignment as time has been expired.
Ahsan H. Mansoor, executive director of the Policy Research Institute, told the Daily Messenger “Bangladesh has lost about one billion dollar per day in the last few days. This is a great loss for Bangladesh. Because Bangladesh is already in economic uncertainty.”
However, business and industrial activities have resumed since Wednesday. Bangladesh’s economy is facing its toughest challenge in decades due to high inflation, declining exports and dollar crisis. At that moment, garment factories and shops were shut down due to the violence. All port operations were stopped. To control the situation, the government cut off internet connection across the country along with imposition of curfew.
Ruhul Amin Sikder, Secretary General of Bangladesh Inland Container Depots Association (BICDA), told the Daily Messenger “We have incurred huge loss during ten days. It will take time to recover the loss. I fear the situation will not normal within a week.”
Despite this depression, garment factories resumed production. But the challenge of the moment for the exporters is to deliver the consignment within due time. The good news is that after the operation of the ports, the speed of import and export container shipment has increased. Business activities have started as broadband internet connectivity resumes. Moreover, the exporters started communicate with the buyers.
Muhammad Hatem, Executive President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) is concern about availability of raw material as the transportation system was completely lost. He said “Due to the disruption of the supply system, the factories are facing a shortage of raw materials.”
He said, the exporters are communicating with the buyers and trying to make them understand the situation of the country. He hopes, the trusted buyers would understand the situation. Already, the biggest consignment of the biggest brand H&M has been stuck in port. But the H&M assured that they will receive the consignment and pay the bills on time.
Economist Zahid Hussain said this crisis will impact the confidence of foreign buyers and tarnish the image of the country.
According to Bangladesh Bank, Bangladesh's annual inflation stood at 9.73 percent in the 2023-24 fiscal year, the highest in 12 years and higher than the government's 7.5 percent.
Meanwhile, banks opened on a limited scale from Wednesday after a three-day general holiday amid the ongoing unrest. It allows customers to withdraw money, collect remittances and pay utility and credit card bills.
Ruhul Amin Sikder also said that Offdock's container handling depends on the country's trade and commerce. Both imports and exports increase when global trade is favorable and the country has a business-friendly environment. It also increases the amount of handling. So as much business-friendly environment can be created, the dollar crisis can be overcome and the overall import and export trade of the country will bring benefits.
In the outgoing financial year 2023-24, the country has exported goods worth $42 billion. These exports are $1 billion lower than the figures provided by the Export Promotion Bureau (EPB) based on data from the National Board of Revenue (NBR) customs department.
The information has emerged in the minutes of the fourth meeting of the Monetary Policy Committee. In this, the central bank said that Bangladesh's product exports have been decreasing for three fiscal years from 2021-22.
Messenger/Fameema
