'There's uncertainty in politics, dark clouds loom large'

Planning minister MA Mannan has said there is uncertainty in politics and dark clouds loom large in the political skies.

"But we hope the storm won't strike. Politicians must come to discussions in a civilised manner," said the minister while replying to queries of newsmen at a discussion.

Appealing to the politicians, he said, "Sticks and stones won't bring down prices or inflation."

Mannan was speaking as chief guest at the discussion organised by the World Bank today, Thursday, at a hotel in the capital city.

The World Bank country economic memorandum, Change of Fabric, presented at the meeting, said that Bangladesh's growth may take a downward turn if reforms are not carried out.

The report recommended prioritising reforms in three sectors -- trade competitiveness, financial sector resilience, and urbanisation and connectivity.          

The planning minister said, "There are problems in the banking sector and other sectors. There are many failures in these sectors for a number of reasons. These sectors need reform. We will definitely carry out reforms, the people want reforms. Even if we cannot carry out all reforms, we will certainly make significant reforms. I can assure you of that."

About the link between reforms and political economy, the planning minister said, "We will not perhaps be able to march fast forward, but we will advance ahead. We perhaps will not be able to march forward as forcefully as you want us to."

The World Bank's report said that if reforms are not carried out, the GDP may fall to 5 per cent between the years 2035 and 2041. And if there are mediocre reforms, then the GDP may be 5.9 per cent and if there are robust reforms, then there may be a 7 per cent growth. Without reforms, the rate of per capita income growth may fall too.

The World Bank has made some recommendations to maintain the rate of economic growth. The report said that average tariffs in Bangladesh are higher than its comparator countries, which is an impediment to trade and so tariff modernisation, increased trade facilitation and investment reforms can boost economic growth.

Concerning the banking sector, the World Bank said that the performance of the banking sector would become important in the country's future economic development, but this sector needed to be scaled up. There had been improvements in the financial sector over the past four decades, but this was not adequate.

It also said that modern urbanisation was important for the next phase of Bangladesh's development and so focus was needed on balanced modern urbanisation.

World Bank's senior economist Nora Dihel and the bank's lead economist consultant Zahid Hussain highlighted various aspects of the 'Change of Fabric' report.

Also speaking on the occasion were executive director of the South Asian Network on Economic Modelling (SANEM), Selim Raihan, founder of SBK Tech Ventures and SBK Foundation Sonia Bashir Kabir, World Bank's acting country director Dandan Chan and others.