Driving digital Bangladesh forward

Driving digital Bangladesh forward

Md. Joynal Abdin

The Independent on July 16, 2018

One achievement of the government is more visible i.e. expansion of digital technology and its uses in day to day activities of mass people. Making digital Bangladesh was the election manifesto of Bangladesh Awami League in 2009 general election. With different limitations digitization took place in many sectors and different government services became peoples reach due to introduction of online processes. But till now people are not getting full benefit of digital Bangladesh due to lack of commitments from the corrupt bureaucracy and lack of monitoring and evaluation by the responsible higher authority. Corrupt official are not allowing full digitization of the processes to remain unofficial earning line alive. Therefore respective Secretaries and Ministers should be careful to make the processes fully digital to ensure hassle free delivery of government services to the mass people and make digital Bangladesh truly functional. At the same time government has to move further with its Digital Bangladesh concept into Digital Economy concept.

Digital economy refers to an economy that is based on digital computing technologies. The digital economy is also sometimes called the Internet Economy, the New Economy, or Web Economy. Digital economy is related to various areas in the development of ICT infrastructures, equipment, services and applications across industries like mobile network, fixed broadband access network, transmission network, ICT application and services, ICT infrastructure, equipment and in semiconductor industry etc. According to the Oxford Dictionary “digital economy is an economy which functions primarily by means of digital technology, especially electronic transactions made using the internet”. Bangladesh entered into the Fourth Generation (4 G) age of telecommunication. High speed internet connectivity is available in the country but till now its cost is comparatively higher for the general people. Cost of internet uses has to bring into general peoples reach and other processes have to be cleared to make digitization functional, effective and fruitful. For example receiving foreign currency earnings through outsourcing is still out of mass peoples reach. Only members of a certain association can open such accounts in selective banks and receive PayPal account’s earnings here in Bangladesh. Making instant online inter-bank transactions, purchasing goods from online portals, receiving online payment is still impossible. Bangladesh has enormous potentials in outsourcing business but producing trade based qualified manpower is yet to be added in formal learning. Whereas digital economy risen about USD 3 trillion during last twenty years globally.

According to Forbes magazine about 1,25, 000 large organizations are launching digital business initiatives with estimated digital revenue increase by more than 80per cent by 2020. There is evidence that the companies that are adapting digital technologies are 26per cent more profitable than their industry peers. Bangladeshi SMEs are yet sleeping to adopt digital means of business i.e. e-commerce and e-business due to absence of digital infrastructure. Paying or receiving online is not possible till now. Even instant online interbank transaction is out of peoples reach. Online trading of shares by mass people is not started as a result share market did not expand as it should be. Company registration, trade license, tax payment, passport renewal and many other government services is supposed to get online but to remain corrupt practices alive relevant officials are not providing those digital processes to be fully functional.

According to McKinsey Global Institute (MGI) report “Digital globalization: The new era of global flows”, “soaring flows of data and information now generate more economic value than the global goods trade” making “possible for companies to reach international markets with less capital-intensive business models”. Digital economy is contributing in increasing economic growth, expanding business opportunities, creating new jobs, improving public services delivery etc. with all these benefits digitization has few challenges like cyber security, cyber crimes, cyber war etc. to be careful about.

Now come to the point what initiatives could be taken to move from digital Bangladesh into digital economy. First initiative in this regard is to adopting relevant ICT skills in the curriculum of different levels to ensure demands of the proficiencies from the applied business sectors. Increasing use of digital technologies at work and adopting new skills in national curriculum. Adopting occupation specific generic ICT skills at worker level curriculum to make them able to use such technologies in their daily work like access information online or use software for a specific purpose.  Adopting curriculum relevant to the production of ICT products and services like software, web pages, e-commerce, cloud and big data etc. specialist skills to programs, applications and manage networks. Adopting ICT-complementary skills like capability to process complex information, communicate with co-workers and clients, solve problems, plan in advance and adjust quickly. At the same time attainment of sound levels of foundation skills constitutes a prerequisite for the proficient development of ICT generic, specific and complementary skills could make the curriculum digital economy friendly.

Secondly; government or donor funded development projects could be driven into establishment of digital infrastructures to make relevant business processes functional, secured, transparent and accountable. Without making the processes functional, or establishment of required infrastructures digital Bangladesh will not move into digital economy. Digitalization of enterprises and their functions is the prerequisite of digital economy. Globally its expansion speed is much higher than that of the product based economy. Services sectors especially government services delivery system digitization may be a good initiation of the digital economy movement.

Finally; spreading out of digital benefits throughout the country is still a major challenge of digital Bangladesh. Internet speed in the village level is remaining a major obstacle to start any productive venture. Therefore people’s congestion is rising in the major cities. Spread out of digital infrastructure into village level could reduce peoples flow to the cities too. Digitization of economy and entering into digital movement could offer quicker development of Bangladesh economy and achieving vision 2021, SDG 2030 and finally vision 2041 in time. Thus digital Bangladesh could be transformed into Digital Developed Economy of Bangladesh.

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Entrepreneurial ecosystem needs improvement

Entrepreneurial ecosystem needs improvement

Md. Joynal Abdin

Published by the Financial Express on May 8, 2018

Bangladesh achieved the lower middle income country status in 2015, with the hope of graduating from the list of Least Developed Countries (LDC) by 2024. At the same time, we have a vision to become a developed nation by 2041. Bangladesh’s successes in different parameters of Millennium Development Goals (MDG) have been praised by global think-tanks and investment banks. Renowned investment banker Goldman Sachs and economist Jim O’Neill identified Bangladesh as one of the Next Eleven (N11) countries along with Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea and Vietnam back in 2005.

In one of his recent articles published by BARRON’S on 28 April 2018, O’ Neill praised Vietnam for its successful journey of economic development from 2005 to 2018. He described Turkey and South Korea as countries having living standards similar to the European countries. But he was completely silent about Bangladesh.

Similarly, JP Morgan identified Bangladesh as one of the Frontier Five (Frontier 5) countries along with Vietnam, Nigeria, Kazakhstan and Kenya in 2007. JP Morgan revised this list of Frontier Five in 2017 by keeping Ghana, Dominican Republic, Egypt, Peru, and Colombia in the list, which they felt have more investment opportunities and prospects. Bangladesh was again missing from this list as well. Therefore, it is time for Bangladesh to rethink its entrepreneurial ecosystem: Why we are absent from such influential global ratings? Is it because Bangladesh was more promising for investment in 2005 or 2007 than the developing Bangladesh of today? Or is it because our entrepreneurial ecosystem is becoming more complex due to absence of certain entrepreneurial tendencies or features?

Let us try to analyse entrepreneurship, factors that influence it, models of entrepreneurship development, and significance of entrepreneurship for a developing country like Bangladesh. Scholars have defined entrepreneurship in different ways. For example, Kuratko & Hodgetts defined entrepreneurship as a dynamic process of vision, change, and creation. It requires application of energy and passion towards the creation and implementation of new ideas and creative solutions. It includes the willingness to take calculated risks in terms of time, equity, or to marshal needed resources and fundamental skills towards building solid business plans.

According to Harvard Kennedy School, entrepreneurship consists of any earnest activity that starts, maintains, and develops a profit-oriented business in interactions with internal situation of the business and external situations like economic, social, and political ones surrounding the business. In simplified form, we can say that entrepreneurship is an entity to commercialise an idea or innovation with a profit motive by taking calculated risks. Entrepreneur is that risk-taker who organises all the factors of production and uses them to convert an idea into a profitable venture.

Two types of environmental factors have influence over entrepreneurship, namely internal or controllable factors and external or uncontrollable factors. Controllable internal factors are lack of efficient manpower, absence of technical knowledge or appropriate machineries, managerial know-how, cost of the factors of production etc.

One of the most important comparative advantages of Bangladesh is its young manpower. But there is a shortage of skilled manpower in the market; as a result, local entrepreneurs are employing many foreign managers and technicians in the readymade garments sector. We have a scope to develop need-based, industry-specific skilled manpower in Bangladesh. But unfortunately, all the public and private universities are generating job-seekers educated on old-fashioned curricula. As a result, they are not capable of fulfilling the needs of different industrial sectors and remain unemployed. More than three million educated young men and women are unemployed in the country now. Additional two million educated job-seekers are entering the economy every year. Therefore, there is tough competition for availing any job. The government can revise the academic curricula after consultations with the industries and incorporate current issues to mitigate this challenge. Private sector entrepreneurs can be encouraged to spend money for their employees’ training at home and abroad in order to develop their skills and improve productivity in the local industries. There can be a provision in the next national budget for allowing private enterprises to spend five per cent of their income for capacity development of their workforce by offering equal amounts of tax waiver.

Uncontrollable or external factors include inconsistency of government policies, discontinuation of policies, frequent shift of policies, unjustified taxation system, corruption in government departments, unprofessional bureaucracy, deteriorating law and order situation, extortions etc. Bangladesh is suffering from negative impacts through each of the uncontrollable factors. Therefore, doing business here is more complicated and costlier than the competing countries. As a result, it is performing miserably in the global ‘doing business’ index every year. Our complex, time-consuming and corrupt processes of business registration and approvals are discouraging local youths from becoming entrepreneurs and are also repelling foreign investors.

Bangladesh needs a healthy entrepreneurial ecosystem to sustain its status as a developing country and graduate to a developed nation status, because entrepreneurs have a significant role in the economic growth of a country in the following ways:

  1. Entrepreneurs invest their money to innovate processes and techniques for increasing productivity in respective enterprises and sectors. Thus, they contribute towards improvement of national productivity and GDP growth of a country.
  2. Entrepreneurs generate employment opportunities by establishing new enterprises and helping the government in its fight against unemployment.
  3. Entrepreneurs adopt new technologies in respective industries, and facilitate transfer of technology throughout the country.
  4. Entrepreneurs play strategic roles in commercialisation of new inventions in the society.
  5. They invest money and take risks to produce new products by utilising resources available in a society.
  6. Progress of a business venture or industry in a community helps improve the standard of living of that particular community.
  7. Entrepreneurs play a crucial role in the restructuring and transformation of an economy. For example, Bangladesh economy is now gradually changing from a traditional agrarian one to an industrial one.
  8. Balanced industrialisation facilitates balanced economic development of a country.
  9. Entrepreneurship ensures dynamism in industries by launching innovative products and services.
  10. Entrepreneurs often search for new international markets, and create new market mechanisms locally.

In conclusion, we can say that entrepreneurship plays a multidimensional role in the development of a country. Therefore, the Bangladesh government should ensure a healthy ecosystem to encourage new entrepreneurs and promote proper growth of existing players by implementing business-friendly policies, regulations, processes, ensuring law and order, and curbing corruption, extortions etc. Bangladesh has a long way to go in creating a congenial entrepreneurial ecosystem and improving its current ranking in the global ‘doing business’ index. Without effective steps that can address these issues, foreign investors are unlikely to come in a big way, while local investors may be lured to migrate to other countries.

Post-LDC Challenges for Bangladesh Economy

Post-LDC Challenges for Bangladesh Economy

Md. Joynal Abdin

The Daily Sun on 6 February 2018

Bangladesh became a member of the least developed country (LDC) club in 1975. As a newly emerged independent country Bangladesh had to face many socioeconomic as well as geopolitical challenges at that period (soon after the independence).

But gradually we achieved remarkable progress in many fields and emerged as one of the fastest growing economic power in Asia. Continuous progress of Bangladesh economy is an example to the entire world. But we are supposed to achieve even more if political chaos, greed and immaturity is not there. Frequent change of political ideology made us bound to radical shift towards multidimensional economic paradigm. Besides shortcomings of infrastructure, industrial utility, absence of united political will towards a particular system of economy, Bangladesh achieved the millennium development goals (MDGs) with significant performance in many arenas. Bangladeshi expatriate workers and women workers in readymade garment (RMG) sector are the significant contributors of this wonderful achievement.

Bangladesh reduced poverty rate into 23.2% (up to 2016) whereas it was 31.5% in 2010. At the same period extreme poverty rate declined into 12.9 % from 17.6% in 2010. Per capita income of Bangladesh increased to USD 1610 in 2016-17 fiscal years. Hopefully, Bangladesh could be considered to graduate from the list of LDC in upcoming triennial review meeting of the Committee for Development Policy (CDP) in this year. Second review of the same committee could be in 2021 then we will be observed for another 3 years i.e. up to 2024 to be finally graduated from the LDC club. This graduation is so much expected and welcoming for the whole nation. It will increase value of Bangladesh brands, Bangladeshi passport, and Bangladesh’s position in different global platforms. Therefore every Bangladeshi is expecting this graduation as soon as possible. But before going for final celebration of this achievement we should conduct an impact assessment study by an impartial body to identify possible impact of LDC graduation on Bangladesh economy during next decade. Few impact of LDC graduation on Bangladesh economy could be as follows:

  1. Loosing preferential market access / preference erosion: Bangladesh exported USD 34.83 billion in last fiscal year. About 90% of Bangladesh’s total exports go to the export markets under different preferential market access facilities in EU (under EBA), Canada, Japan and the US, under their respective GSP schemes. Bangladesh also enjoys preferential market access in such other industrialized countries as Australia and in some developing countries, such as China, India and the Republic of Korea, under RTAs and bilateral initiatives. All these schemes are non-reciprocal in the sense that Bangladesh is not expected to offer preferential access to products originating in the preference-giving countries in response to the offer made to her as an LDC. Since developed country markets account for about 90 per cent of Bangladesh’s total exports, preferential market access in these countries is of special significance to Bangladesh. Besides GSP or EBA Bangladeshi export items are enjoying duty free and quota free market access under the following trade regime:
  • Special and Differential Treatments (S&DT) for LDCs under different agreements of WTO
  • Preferential market access for LDCs under different regional trade agreements like SAFTA, BIMSTEC, APTA etc.
  • Preferential market access for LDCs under different bilateral trade agreements.

The above mentioned discussion made it clear that, Bangladesh’s export items enjoys preferential market access in different parts of the world under different trade regime. If 90% of our export items loose preference then Bangladesh’s export performance is likely to be adversely affected. Therefore fact finding studies should be conducted to identify the financial value of preference erosion in USD, what could be its spillover effects on Bangladesh’s investment environment especially to attract FDI, what could be ways forward to minimise adverse affects of preference erosion on Bangladesh economy.

  1. Impact of Reciprocal Trade Regime Offerings: Currently Bangladesh is a member of nine (9) RTA or FTAs namely, Asia-Pacific Trade Agreement (APTA), Bangladesh-Sri Lanka Free Trade Agreement (Proposed), Bangladesh-Turkey FTA (Proposed), Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) Free Trade Area, Pakistan-Bangladesh Free Trade Agreement (Negotiations launched: 2003), People’s Republic of China-Bangladesh FTA (Proposed), Preferential Tariff Arrangement-Group of Eight Developing Countries (D-8), South Asian Free Trade Area (SAFTA), Trade Preferential System of the Organization of the Islamic Conference (OIC PTA). An LDC country is allowed not to offer reciprocal trade preference to its counter parts. But Bangladesh has to offer it while graduating from LDC. In such case signing free trade agreement could be more costly for Bangladesh after graduating from LDC list.

  1. Paradigm shift in Official Development Assistance: Bangladesh received official development assistance from development partners 90.5 % as grant and only 9.5% as loan in 1971-1972 fiscal years. Foreign grants and soft loans played a vital role in infrastructure and other development activities in Bangladesh. Still official development assistance (ODA) is a significant source of funding in various mega project of Bangladesh. Development partners are shifting their mode of financing with the wheel of local economic development. Grant amount is decreasing and loan amount is increasing day by day. For example Bangladesh received only 12.5% grants and 87.5% loan in last fiscal year. Soon after the graduation Bangladesh will be completely out of grant assistance facility, everything has to be bearded by local resources or go for foreign loans and repayment with interest. So it may have another adverse affect on development motion of Bangladesh.

  1. Other challenges: Besides the above mentioned challenges Bangladesh may face challenges in getting aid for trade, implementing IP laws, paying more subscription fee to international platforms like UN, unavailability of technical cooperation in terms of development assistance etc.

Finally; we can state that, Bangladesh’s graduation from the list of LDC is a good news for us, but could we please recheck statistical figures that we are producing now, is there any methodological errors, could we conduct an impact assessment study to identify post graduation adverse affects on Bangladesh economy, could we please evaluate economic value of those prospective adverse affects whether we could survive and prosper further or bounced back to the LDC club again. It is better to graduate later than bouncing back to the same pavilion again. We have to develop 100 SEZ, Deep Sea Port, Increase efficiency of existing sea ports, generate more power, develop internal road networking and offer load shedding free electricity connection to the mass people. Lots of mega projects are yet to be materialised. Internal resource mobilisation, confidence building of local investors and attracting foreign investors to invest here in Bangladesh is still pending. So graduation without preparation could be more painful for us if sustainability is not sure.

Journey to Competitive, Inclusive and Sustainable Economic Progress

Journey to Competitive, Inclusive and Sustainable Economic Progress

Md. Joynal Abdin

The Daily Sun on October 31, 2017

The world is going through an economic and political power shifting from the west to the east during the last couple of years. Reshape of geopolitical forces is resulting in extra tensions in the world politics. Its impact on the economic progress is becoming more visible day by day.

The world economic growth was 3.5 % in 2017 but uneven distribution of wealth increases disparity around the world. As a result, all segments of the society are enjoying the benefits of economic progress. Current economic models are not capable enough to serve needs of different segments of the society equitably. Socialist movement failed to serve its objectives even in its birth places. Similarly, limitations of the capitalism are becoming clearer to the academics and practitioners. Therefore, the World Economic Forum feels the need for a new model of human centric economic progress.

Capitalist concept not only failed in the least developed countries like Bangladesh, it also failed to reduce inequalities in the advanced economies like USA or Germany as well. The world experienced complex impact of globalization during the last decade. It is creating job in one corner but shifting job from others. Job creation versus job diversion is currently a popular debate of free market economy. The well off segment of the society is enjoying its rapid boom; on the other hand, the neglected segment is suffering more. Therefore, the world is in need of an inclusive and sustainable model of economy which will be inclusive, environment friendly and safe for future generations too. This model has to be human centric, pro-environment and create equal opportunities for all segments of the society.

To achieve the above societal features of economic progress, governments have to enact public-private collaborative policies. A joint effort of the government, business community, academia, and civil society will have to be ensured to get optimum benefit out of it. Countries have to be more competitive to face the emerging challenges of tomorrow.

Bangladesh is focusing upon the issue from different platforms. But in absence of a better coordinated effort we are failing to achieve targeted benefits in time. As per the latest report, Bangladesh ranked the 99th position of the Global Competitiveness Index. It progressed a little from 106th position earlier. But 99th position is displaying our measurable competitiveness around the world whereas we are dreaming to be among the Asian Tigers or Next 11 or Frontier 5 in economic development.

If we look at the current global competitiveness index we could find Switzerland, USA, Singapore, Netherlands, Germany, Hong Kong, Sweden, UK, Japan and Finland in the top 10 respectively. Two Asian representative Singapore and Japan are in the top ten. Our neighboring countries (other than Pakistan) are also doing quite well than us. India ranked 40th previously they were in 39th position. India’s negative growth is not for their bad performance but it is for others’ better performance. Other members of SAARC like Nepal ranked 88th previously they were in the 98th position. Bhutan ranked 82nd but previously they were in the 97th position. Pakistan ranked in 115th previously they were in 122nd and Sri Lanka ranked in 85th previously they were in 71st.

Global competitiveness index is not only a single featured ranking but it is an aggregate outcome of 12 different pillar analysis. These twelve pillars are institutions, infrastructure, macroeconomic environment, health and primary education as basic requirement of factor driven economies.

The second groups of pillars are higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness and market size as efficiency enhancer of efficiency driven economies. Finally; business sophistication and innovation are factors of innovation driven economies. Therefore, global competitiveness index is a comprehensive outlook of an economy.

Bangladesh Investment Development Authority is working out to prepare ourselves for uplifting Bangladesh’s position in the doing business index.

There is a position called Chief Coordinator for SDG affairs in the Prime Minister’s Office to ensure better coordination in implementation of the SDG related government policies. Similarly, a Commission or Board or Corporation is needed for looking after these 12 pillars related to the competitiveness index. It is more important than other stated issues here due to its coverage and wide range of the scope. Even a dedicated ministry could be established to look after the competitiveness issues to make Bangladesh competitive and face the challenges of tomorrow’s world.

Competitiveness is required not only for economic growth but also for the inclusiveness and sustainability. Economic growth without inclusiveness will increase disparity, social tension and environmental threats. Therefore, we are in extreme need of such economic policies / systems where inclusiveness will be ensured, equal opportunities could be created, and that would be environment friendly and safe for the planet. Without thinking of humanity, consciousness of environmental safety no economic advancement should be acceptable because pro-human and pro-planet policies are demands of the time now; otherwise social chaos and adverse reaction of the nature is waiting for us in near future.

 

Opportunities and challenges of the new industrial revolution

Opportunities and challenges of the new industrial revolution

Md. Joynal Abdin

The Independent on November 26, 2017

 

The term revolution means radical change of existing order in favor of a newer one. Industrial revolution refers to the radical improvement of manufacturing and other technologies that have completely changed the previous scenario and established a newer version with positive shift of industrialization. Experts are forecasting that 4th industrial revolution is taking place in the international arena. As a part and parcel of industrialization Bangladesh have to enter into the 4th industrial revolution to compete and gains its stake from the industrial world. Each change or shift offers something opportunistic and few challenges. Relevant policy makers have to be careful about the opportunities to grab and challenges to overcome of it. Bangladesh has a long list of industrial sectors waiting to take off. Some of the sectors are in performing level like RMG sector; some of the sectors are in growing stage like Leather and leather goods sector, some of the sectors are potential to grow like ICT and Outsourcing. In such a condition 4th industrial revolution is taking place. So we have to be careful about the opportunities and challenges of 4th industrial revolution and prepare proper policies to grab the opportunities at most and overcome the challenges efficiently.

The then latest technologies played vital role in each of the industrial revolution for example 1st industrial revolution (1760) was driven by the rise of steam power, railways and mechanized forms of production. Similarly 2nd industrial revolution (1890) was driven by the invention of electricity and new approaches to manufacturing based on assembly lines and mass production. Rapid improvement of semiconductors and the spread of computers and the internet technology were the driving forces of 3rd industrial revolution (1960s) finally 4th industrial revolution is going to be take place with the mass performance of the artificial intelligence, advanced robotics, mobile internet (available everywhere), 3D printing, autonomous vehicles, such as cars and drones etc. technologies. These technologies will offer new ways to create and consume, will transform how we deliver and access public services, and will enable new ways to communicate and govern. Almost every aspect of our lives will be touched: jobs, business models, industrial structures, social interactions, systems of governance.

In comparison to the 4th generation manufacturing / production technologies most of the Bangladeshi sectors are lagging behind. As a result there performance and product’s quality, productivity is very low in comparison to the competing countries technologies. Therefore challenge of losing market share by Bangladeshi companies in upcoming competitive world is becoming prominent day by day if we failed to adopt the sophisticated technologies and machineries in every sector. Study found it out that, new technologies are emerging faster, being adopted more quickly and delivering greater impact than ever before. For example fixed-line telephones (1878) took 75 years to reach 100 million users. On the other hand mobile phones (1979) took only 16 years to reach 100 million users. Similarly internet (1990) took 6 years to reach 100 million users. On the other hand Apple App Store (2008) took just 3 years to reach 100 million users. So it is proved that the technologies pushing the reality into 4th industrial revolution will be adopted faster and change the reality of human society even faster ever before.

Opportunities of 4th industrial revolutions could be wealth maximization through continuous improvement of GDP growth, inclusive growth, improved performance of the SMEs, jumping into advanced stage of development, connecting disconnected people, improve environment management system, automation of agriculture and transformation of agro production technologies, more access to healthcare and use of modern technology to forecast about natural calamities etc.  Bangladesh shall start its wholehearted preparation to avail all of these above mentioned opportunities of 4th industrial revolution. For example we have highest priority to economic growth, SME development, digitization of processes etc. but till now we are lagging behind in terms of inclusive growth, improved environment management system, access to healthcare by all etc. parameters. Preparation to avail an opportunity could be our strengths and vice a versa.

Challenges of the 4th industrial revolution includes losses of jobs and disruption by the lower educated people, inequality and political instability, end of low-cost and low-skilled labor based industrialization due to artificial intelligence and robotics technology, more market access to the global giant companies through offering more value to the customers, vulnerability of LDC countries to fight with cyber crimes and cyber attacks etc. Shift of technology causes losses of job by the people dependent on the previous technology for any reason. For example light engineering enterprises of Bogra light engineering cluster used to produce sallow machine, tube well and rickshaw etc. with shift these technology into deep tube well, tractor, battery driven auto-rickshaw and CNG driven auto-rickshaw many of them losses their job there in Bogra light engineering cluster. Because most of them have no access to the technologies relevant to the deep tube well, tractor, battery driven auto-rickshaw and the CNG driven auto-rickshaw due to many reasons. So they lost their livelihood from that profession. Similarly 70 coconut oil mill reduced into 4-5 during last couple of years in Bagherhat coconut oil cluster. Therefore government and relevant agencies have to be careful about the negative impact of 4th industrial revolution on many sectors in Bangladesh.

Finally we can state that, advancement of technology could not be controlled by any society. We have to adopt it today or tomorrow by our own willingness or unwillingly. But we must have to be prepared ourselves to minimize diverse negative effect of it into the society and rehabilitate the victim society like Bogra light engineering and Bagherhat coconut oil cluster. Otherwise new industrial revolution will give us a missed result. Few people will be reached again and rest will be losing respective profession without any rehabilitation facilities. Again it will not be an inclusive development in the society.

Economy: Facing the challenges

Economy: Facing the challenges

 

Md. Joynal Abdin

The Independent on September 25, 2017

Bangladesh economy was flourishing during last couple of decades with on an average 5-6 per cent growth. As a result, we are hopeful that, Bangladesh could get place of middle income country from existing lower middle income country status by 2021, graduate from LDC by 2030 and finally become a developed economy by 2041. With this view in mind our political leadership offered vision 2021, vision 2030 and vision 2041 from respective platforms. More or less policy reforms have been initiated to align with the vision and create a pro-growth environment. Entrepreneurship development and private sector growth got attention of the government to be promoted and prosper.

As a least developed country (LDC) Bangladesh has few built-in barriers like poverty, unemployment, limited resources, shortage of technical knowhow, absence of good governance, corrupt bureaucracy, absence of true sense democracy etc. towards its development. But recently we are in front of few external barriers like recent flood in the northwest, Rohingya crisis in the southeast and upcoming national election in 2019. These three crisis could be well managed if concerned authorities play a respective role with dedication and neutrality. Each of the above mentioned crisis could create unrecoverable damage in the way of our economic prosperity if these are not being managed with professionalism and liability to the nation.

 Around 20 districts of the northern and northwest region of the country affected by the massive flood in 2017. This year flood has broken record of the historic flood of 1988. About 1 million people have directly been affected due to this flood. A good number of agro-farms including poultry, fisheries, and dairy farms has been destroyed by the flood. Exact monetary value of this damage is not calculated yet but no doubt that it is a severe damage to the economy of flood affected people. Poor people of the flood hit districts already loss their livelihood. Damage of will be more painful with the passage of time. This pain will be feeling more when water goes out and new irrigation season starts. Currently farmers are continuing with their savings of crops and cash, but his savings will be ended up if waterlogging period extended than that of the normal phenomenon. Government has to continue relief and other social safety net support in the flood affected area till new crops comes up. This is not less than a six months’ period. Providing relief to 1 million flood affected people for long six months is really a challenging tasks for the resource scarcity nation like us.

Military of neighbouring Myanmar (Burma) is operating a genocide against its citizen in Rakhine State (Arakan). This military operation aims an ethnic cleansing in Rakhine against the Muslim majority Rohingya community. Rohingyas were ancient citizen of independent Arakan in seventies. Burmies king conquered Arakan and made it a state of Burma (Myanmar) and rename as Rakhine. Burmies ruler never provided minimum humanitarian rights of Rohingya community as their citizen. Current military backed government of Myanmar is ignoring citizenship of Rohingya community and pointing out them as outsiders. They are operating an ethnic cleansing program against the Rohingya community. Myanmar military forces are killing Rohingya men, raping Rohingya women, burning their houses, destroying wealth without any causes. As a result, Rohingyas are fleeing out and became refugee in the neighbouring countries mainly in the Muslim majority Bangladesh to save their lives. Total 1 million Rohingya entered into Bangladesh in different times mostly (about 0.7 million) in last two months.

Bangladesh offered them food and shelter due to a humanitarian reason. But over populated and flood affected Bangladesh could not bear their liability for a long time. Ensuring basic needs of a human being for 1 million Rohingya is beyond the capacity of a least developed and already over populated country like Bangladesh. International community as well as regional powers like India and China is playing role of underworld don with this Rohingya crisis. Another big brother Russia is supporting the war criminals in this case. Global geopolitical stakes of these big brother could be motivational factor in this case. But we (Bangladeshi) are not responsible for this crisis we do not want regional or global geopolitical game with this humanitarian issue. We want that global community will come forward to ensure humanitarian needs of this largest number of refuses and get them back to their home with safety, security and dignity. This Rohingya crisis could be another big whole towards projected economic prosperity of Bangladesh.

Current legal government is ruling the country with 154 uncontested (without peoples voting mandate) members in the parliament. Legal validity of this government is declared by the court. But ethical standard of this government is still questionable in home and abroad. Therefore, current prime minister Sheikh Hasina wants an unquestionable election in 2019. Similarly, general people of the country is also waiting for a free, fair, credible and participatory election in 2019. But ensuring that free, fair, credible and participatory election is still a big challenge for the nation. Ruling party has completed all legal arrangements to hold the national election under their regime. But it is quite impossible to hold a fair election under any political party in the power. Dhaka city corporation election and elections of last few years proved this assumption. Therefore, same scenario of 2014 could be seen again in 2019. Government could use the law enforcement agencies to hold a partial election and oppositions may go for strikes and other damaging programs. Which may be cause of mass destruction of people’s wealth and life.

Finally; we could state that, massive flood, Rohingya crisis and upcoming national election etc. could be nightmare before the economic prospects of Bangladesh. Flood affected people have to be rehabilitated in time through ensuring their basic needs and rehabilitating supports. Rohingya crisis has to be resolved with support of international community, global platforms, and our friends in the Europe, America and Muslim worlds. Regional big brothers may not play a friendly role here in this regard. We may play the same role which was played by our great neighbouring friend India in 1971. If India have done a great job for the Bangladeshi in 1971 why not Bangladesh could adopt the same policy for the Rohingya community in 2017. Finally, we have to work out and reach into a way forward to hold the national election 2019 peaceful, free, fair, credible and participatory by leaving hock and cook instruments away. Otherwise, our vision 2021, 2030, and 2041 will remain in the paper and never be in practice.

Trade Organisations in Sustainable Economic Development

Trade Organisations in Sustainable Economic Development

Md. Joynal Abdin

The Daily Sun on April 26, 2017

There is no alternative of individual and institutional income generation for economic development and poverty alleviation of a country. Ensuring employment is the most effective tool for facilitating individual and institutional income generation. There are about 162 million populations in Bangladesh and about 120.70 million of them are in workable age group. For providing employment to such a huge number of populations government has only 1.7 million positions in civil service, a mentionable percentage of this government positions remain vacant forever; for example 18% of government positions are vacant now in Bangladesh. As per a recent report there are 58.10 million people involved with private sector jobs.

There are no exact data regarding the total number of businessmen in the country but it is stated that, there are about 30 million businessmen in Bangladesh. From the above statements we could find out a summery that there are about 37.20 million unemployed people in Bangladesh now.

Another recent report shows that there are more than 3 million higher educated unemployed populations in Bangladesh with 2.2 million newcomers in the job markets every year. It is easier to manage and employment opportunity for a low educated or uneducated youth but difficult to manage a career opportunity for a higher educated one. Uneducated or lower educated manpower could migrate into Middle East as a labour but higher educated youth could not do so. Thus the number of unemployed higher educated people is rising day by day. If such a trend continues for next few years they could be another burden for the society as well as for the nation.

Before meeting a terrible situation of the above mentioned problem we must have to identify a way out of it. The government has to take the issue as a new challenge and come out with appropriate solutions. The government could mitigate this problem with professional education system, skills development through practical training, creating entrepreneurs through entrepreneurial education, creating entrepreneurship friendly policy regime, creating start-up friendly fiscal and economic policies, self-employment oriented education / training, hands-on training for creating freelancers etc. Such types of projects should get the highest priority in the upcoming national budget of the government.

There are few problems which are impossible to solve by individual or organisational initiative. These problems are subject to be dealt with collective power and unity. To apply that collective power of the business community, effective trade organisation is required. There are about five hundred trade organisations in Bangladesh; among these 101 are chamber of commerce (district chambers, metropolitan chambers, joint chambers, international chambers etc.) and about 379 sectoral associations are mentionable. The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) is the apex institution that represents all the trade organisations of Bangladesh.

FBCCI used to negotiate, cooperate and support the government in enacting trade related policies on behalf of the private sector of the country. It represents all the trade bodies in different committee forms by different ministries, agencies, departments, and other organs of the government. It assists all the 500 trade bodies of the country in holding election and other regulatory purposes. FBCCI used to negotiate budgetary facilities for different sectors, products and customs structures with the national board of revenue (NBR) on behalf of the private sector.

To perform all of the above mentioned duties an efficient and functional FBCCI is our national requirement. To make it functional and effective its current manpower has to be increased, professional skills of existing manpower has to be improved and financial capacity of the federation has to be uplifted. There are many countries in the world where federation / national chambers are getting budgetary support from the government.

But till now FBCCI has to depend upon its members’ subscription, building rental and donation of business community. It is not sufficient to employ and retain efficient professionals and expand its services to the economy of Bangladesh. FBCCI will get its new leadership through the upcoming election in next month. We are hopeful that the new management will take necessary initiative to take the organisation as well as its member bodies into new height and serve the nation better. Competing business leaders are supposed to declare respective election manifesto soon. We would like to offer few recommendations as follows for their consideration and include into the election manifesto for making the federation as well as other trade bodies (chambers and association) for functional and effective:

  1. Taking necessary initiative to get budgetary support for operating FBCCI from the government.
  2. Pursuing the government to involve district chambers closely with the development project implementing in respective district.
  3. Undertaking projects to ensure hassle-free visa facility for the business community in consultation with all the foreign missions working here in Bangladesh. It will increase movement of our foreign trade into a new destination.
  4. Increasing research based capacity of the federation through undertaking visible interventions along with a time bound action plan
  5. Increasing capacity of the federation to undertake projects for private sector development and pursue government and other development partners for funding.
  6. Making the initiative of establishing Entrepreneurship Development Institute (EDI) a reality (initiated earlier but failed to get finance). Indian model of EDI, located at Ahmedabad, could be replicated here in this regard.
  7. Capacity building of different trade bodies to provide business support services, registrations and licenses. Negotiating with the government to hand over trade license, small and cottage industry registration etc. responsibilities to the trade bodies.
  8. Participating in foreign investment / trade fairs with own stall of FBCCI to facilitate B2B business matchmaking.
  9. Establishment of product research and new product innovation centre, testing laboratory, and undertaking product diversification initiative to enlarge export basket.
  10. Perusing the central bank and other ministries of the government to inspire the corporate houses, banks, NBFIs to support FBCCI development 10fund from respective CSR budget.
  11. Developing a research fund for conducting a certain number of systematic researches by the FBCCI research team every year.
  12. Providing FBCCI Award to the best growing company, most employment creator company, most Donor Company, best exporting company etc. to recognise their contribution to the society and inspire them to donate most at FBCCI development fund.
  13. Establishment of FBCCI’s branches in important business hubs at home & abroad and fixation of an FBCCI contact point in relevant ministries.
  14. Opening a news department in FBCCI and all major chambers and associations to assist local entrepreneurs to get quality certification of respective products from respective international or foreign authorities. It will help to get more acceptances of Bangladeshi products to the foreign buyers.
  15. Establishing business incubation centre to support new entrepreneurs, perusing the government for start-up financing.
  16. Establishing technology and engineering institute to produce skilled manpower as per demand of different business sectors.
  17. Motivating government for creating an environment to commercialise local inventions.
  18. Undertaking regular research on different international trade arrangements under the WTO, RTA or BFTA to make local entrepreneurs aware about our trade benefits under different agreements and facilitating to utilise the benefits in international trade.
  19. Playing more visible role in creating freelancers and adopting outsourcing friendly infrastructure in Bangladesh by the government.
  20. Undertaking projects to facilitate adoption and utilisation of e-commerce and e-business facility to make the digital revolution fruitful.

Finally we could state that the private sector has to play a visible role to achieve SDGs by 2030. This role could be played more effectively from a common platform like trade bodies instead of personal or institutional level. Therefore the government has to play its due role for capacity building of the trade bodies. New elected panel of FBCCI leaders could play the role of catalyst here in this regard. A common vision of the business community, government and the development partners is required to ensure sustainable development of the economy and achieving a developed Bangladesh as per our national target.