Govt battling an unknown quantity
Bangladesh has so far announced a $8.56 billion stimulus package that is nearly three times the original projected financial losses from the coronavirus pandemic.
Earlier found in March, the Asian Development Bank forecasted that Bangladesh's gross domestic item may contract by mainly because much as 1.1 % in the hypothetical worst-case scenario of a substantial outbreak of coronavirus in the country.
Which means, $3.02 billion of the $300 billion-plus overall economy could be wiped off.
Then on April 3, ADB said its preliminary estimates indicate that about 0.2 per cent to 0.4 per cent of Bangladesh's GDP could be lost due to the global pandemic.
From that perspective, the government's priming the pump appears adequate.
"But beneath the present circumstances, it is assumed that the extent of damage could be a lot more," said Prime Minister Sheikh Hasina explained about Sunday while unveiling another stimulus package worthy of Tk 67,750 crore for all businesses, industries and economic sectors, irrespective of size.
By yesterday, 123 persons were infected with coronavirus in Bangladesh and 12 killed by the deadly pathogen, according to the Institute of Epidemiology Disease Control and Analysis.
To flatten the curve on the novel virus, the federal government has essentially place the country along lockdown since March 26. The lockdown has been expanded to April 14.
Given that the united states reported the highest increase in confirmed cases yesterday, it appears that the quantity of cases would inflate soon, necessitating further expansion of the shutdown that has brought monetary activities to a around halt.
"If a significant outbreak occurs in Bangladesh, the effect could possibly be more significant," the ADB said on Friday.
The prime minister gave a few examples of the way the lethal, pneumonia-like virus has effects on the economy.
Import expenditure and export money fell by almost 5 % year-on-year so far in the fiscal calendar year. This drop could be extended by the end of the fiscal time, she said.
Garment exports, which take into account more than 80 per cent of the national exports, would be hit hard in the coming months while some stores have cancelled $3.02 billion worth of shipment orders amid demand collapse in Western market segments, according to data published by the Bangladesh Garment Makers and Exporters Association showed.
Private investment might not exactly reach the likely level as a result of the delay in implementation of construction of ongoing mega projects, establishing of special economic zones and implementation of the single-digit interest levels.
You will see adverse impact on the services sectors, including hotels, restaurants, transport and aviation, the prime minister said.
The purchasing capacity of the low-income persons could be reduced together with there could be disruption in the supply chain as a result of much time general holidays affecting the production of the SMEs and hindrance in the transport services.
As a result of decline in global demand, the world fuel oil price has reduced by a lot more than 50 per cent. As a result, inward remittance move will be affected.
Remittance, among the lifelines for the overall economy, hit a 15-month lower in March as a result of economic fallout found in the global market stemming from the coronavirus pandemic.
"I hope our economy will rebound and we're able to reach near to the desired economic expansion, if the stimulus deals, the previous and the new ones, could possibly be quickly implemented," the primary minister said.
