Economy
BB Takes Action to Stabilize Inflation and Dollar Crisis
Bangladesh Bank (BB) is carefully advancing with an optimistic outlook as it strives to alleviate the economic strain caused by the US dollar crisis and soaring inflation, according to the central bank’s quarterly report on the economy. The report highlights the persisting pressure on the economy from external factors, including escalating commodity prices and supply disruptions resulting from the ongoing Russia-Ukraine conflict, global economic slowdown, and financial sector volatility.
The report emphasizes that the issue is linked to geopolitical conflicts and cannot be resolved overnight. Consequently, the report urges banks and other financial institutions to exercise prudence in their future financial plans.
Bangladesh Bank publishes such reports every quarter, providing updated data on the country’s overall economy.
As per the report, Bangladesh is currently grappling with geopolitical conflicts, which have yet to exert a direct negative impact on the economy. Nevertheless, the economy remains under pressure, necessitating cautious measures.
A significant portion of Bangladesh’s economy relies on the United States, Canada, and the European Union, which constitute the primary sources of foreign investment in the country. These regions also account for approximately 82% of Bangladesh’s exports.
Furthermore, 725 of imports originate from India and China, while a substantial portion of remittances flows from the United States. The ongoing geopolitical conflicts pose a risk to Bangladesh’s export earnings and remittances.
In the current geopolitical landscape characterized by tensions between China and the United States, Bangladesh remains prudent in its decision-making process concerning these two countries.
Additionally, the United States has been openly critical of Bangladesh regarding issues of democracy and human rights. Although Bangladesh aims to maintain good relations with all countries, it is not inclined to accept unwarranted criticism from the United States. Notably, Bangladesh’s export income to the United States experienced a decline of around 12% in the past year due to certain restrictions and recent changes in visa policies.
Previously, restrictions imposed by the US, coupled with the recent visa policy changes, redirected remittances from Bangladeshi nationals residing in the United States back to the country, resulting in a sudden surge in remittance inflows.
The report highlights that Bangladesh continues to face the adverse effects of soaring global prices and supply chain disruptions caused by the Russia-Ukraine conflict. The repercussions of these factors persist, along with the ongoing global economic slowdown that stems from the conflict’s impact. While instability in the financial sector has started to subside, the report indicates an increase in liquidity supply within banks.
The Central Bank expresses optimism that the situation will gradually improve in the forthcoming days.
Expatriate Bangladeshis sent approximately US$ 2.11 billion in remittances during the first 28 days of September in the fiscal year 2024-25, according to data released by Bangladesh Bank on 29 September.
Of this total, state-owned and specialised banks handled $679.10 million, while private banks received $1.43 billion in remittances.
Chief Adviser to Bangladesh’s interim government, Professor Muhammad Yunus, has vowed to expedite reforms and hold elections swiftly. Yunus, who recently assumed the role after the collapse of Prime Minister Sheikh Hasina’s 15-year administration, expressed his commitment during an interview with Tokyo-based news outlet NHK WORLD in New York on Sunday. He was attending the United Nations General Assembly at the time.
Following mass student-led protests that ended Hasina’s long-standing rule in August, Yunus stepped in as the leader of the caretaker government. Known for founding Grameen Bank, an institution providing microloans to the underprivileged, Yunus, along with the bank, earned the Nobel Peace Prize in 2006 for his efforts in poverty alleviation.
During the interview, Yunus emphasized that the interim government’s primary mission is to implement reforms promptly and ensure elections are held as soon as the groundwork is complete. He underscored the importance of success, stating, “Failure is not something that we can accept.”
Addressing the pivotal role of students in the ousting of the Hasina administration, Yunus acknowledged the sacrifices made by young people, referring to their involvement as part of a “revolution.” He highlighted his intention to engage the younger generation in shaping policy.
Furthermore, Yunus called for continued support from Japan, Bangladesh’s largest donor, during this crucial transition period. He stressed that Japan’s assistance is vital to stabilizing Bangladesh’s economy and fostering a democratic foundation in the nation.
Syeda Rizwana Hasan, the Adviser for Environment, Forests, and Climate Change, announced today that steps will be taken to restrict the use of polythene shopping bags to safeguard future generations.
Starting from October 1, polythene bags will be banned in shopping malls, followed by a ban in kitchen markets from November 1.
“Everyone must take responsibility and stop using polythene voluntarily. Action against polythene producers will begin from November 1,” Rizwana Hasan stated during a seminar.
The Department of Environment (DoE) organized the seminar to raise public awareness about alternatives to banned polythene bags.
Rizwana Hasan highlighted that the restriction on polythene will be executed in phases according to legal provisions, and discussions with shopping centers and store owners are ongoing to ensure a smooth transition.
She also announced plans to make the government secretariat a plastic-free zone by December.
Other speakers at the seminar included Environment Secretary Dr. Farhina Ahmed, DoE Director General Dr. Abdul Hamid, Director Rajinara Begum, President of the Shop Owners Association Muhammad Helal Uddin, and Md. Arifur Rahman Bhuiyan, Assistant Professor of Environmental Science at BUP. They discussed the harmful effects of polythene and the need for alternative products.
Earlier, Rizwana Hasan inaugurated a fair showcasing eco-friendly alternatives to polythene bags and visited 24 stalls. The fair featured products from government and private entrepreneurs, including reusable bags, jute bags, paper bags, and items made from bamboo and cane.
