Economy is in shipshape: MCCI
The economy is progressing well despite the presence of some risk factors like marginal growth in remittance, slower exports and a lower rate of investment, according to a report of the Metropolitan Chamber of Commerce and Industry (MCCI).
Inflation between the months of July and September was under control, the exchange rate remained stable and the foreign exchange reserves rose to a comfortable level, said the first-quarter report that was released yesterday.
“The overall economic situation was positive as indicated by the steady improvements in the major economic indicators,” the report said.
During the period, agriculture, manufacturing and services sectors performed well, but continuous government support of various types will be needed to sustain their growth.
Infrastructure deficits and gas and power supply problems are now undermining the performance of all productive sectors of the economy.
“The government should take adequate steps to overcome these problems and achieve and maintain political stability, which are essential for creating investment-friendly climate.”
On the basis of observations in the preceding nine months, the MCCI has made its own projections on some selected economic indicators.
“It is assumed that the peaceful political situation that currently prevails will continue in the coming days. Therefore, export, import, and remittances can be expected to increase.”
The foreign exchange reserves will fall somewhat in November due to payment to the Clearing Union against imports.
The rate of inflation is likely to go up in October because of the probable rise in the prices of some essential commodities, the MCCI said.
Some major sectors also performed well in the first quarter of the fiscal year.
For instance, the agricultural sector grew at a robust rate of 4.19 percent in fiscal 2017-18 compared to a moderate 2.97 percent a year earlier thanks to favourable natural factors and strong policy to ensure timely availability of inputs at affordable prices.
Despite the shortage of energy -- both gas and power -- the industrial sector managed to grow 12.06 percent last fiscal year, exceeding the growth rate of the previous fiscal year by 1.84 percentage points.
The manufacturing sub-sector recorded 13.40 percent growth in fiscal 2017-18, which was 2.43 percentage points higher than the previous fiscal year's.
Within manufacturing, the large and medium scale industries sub-sector grew at 14.26 percent, compared to 11.20 percent in fiscal 2016-17.
The small scale manufacturing industries, however, grew at 9.25 percent in fiscal 2017-18 compared to 9.82 percent a year earlier.
“Bangladesh's economy is progressing well, but due to infrastructure bottlenecks and shortage of power and energy its performance has remained below its true potential.”
In fact, all major macroeconomic indicators like per capita income, foreign currency reserves, import and export, and foreign direct investment depict a strong positive trend, including in public sector revenue collection, the report said.
