Economy
Asia Sizzles in Heat Wave Warning.
In a foreboding sign ahead of the upcoming northern hemisphere summer, an emerging El Nino weather pattern is driving temperatures to unprecedented levels across southern parts of Asia. Vietnam experienced its highest recorded temperature of 44.2C, causing concerns over power shortages, while Laos likely shattered its own records. The scorching heat index in the Philippines prompted a reduction in classroom hours, highlighting the dangerous blend of intense heat and humidity.
These searing temperatures are part of a growing trend of extreme weather events in recent years, pushing the world into uncharted territory. The blistering conditions are testing governments’ abilities to safeguard public health and prevent disruptions to agriculture and power generation in economies still recovering from the impacts of Covid-19.
El Nino, characterized by warmer ocean temperatures in the Pacific, has wide-ranging effects on global weather patterns. While it may bring relief to drought-stricken areas in Argentina and the southern US, it blankets parts of Asia and Australia with hotter, drier conditions, posing a significant threat to coffee, sugar, palm oil, and cocoa crops.
Thailand experienced temperatures above 40C in several regions, leading to a surge in power demand. Businesses and banks have urged the government to prepare an action plan to address a potential three-year drought. Meanwhile, Malaysia anticipates a drastic 40% reduction in rainfall in certain areas, endangering palm oil production in one of the world’s leading suppliers. Authorities are closely monitoring forest fires and air pollution, recalling the disastrous haze episode in Southeast Asia caused by a previous El Nino in 2015.
Other parts of Asia, including China, India, and Bangladesh, have also been scorched by the relentless heat in recent weeks. Yunnan province in southwest China faced its worst drought in ten years, while India remains on high alert for further heatwaves after experiencing soaring temperatures in April. These extreme conditions have already led to school closures and tragic heat stroke fatalities.
As the world grapples with the alarming consequences of this heatwave, it becomes evident that urgent action is required to address the escalating impacts of climate change. Failure to mitigate these effects could have severe implications for the environment, public health, and the global economy.
During the eleventh month of the current fiscal year, the country’s foreign currency reserves have fallen below $19 billion for the first time. After paying off some import bills, the reserves have now stood at $18.26 billion on Sunday.
According to the International Monetary Fund (IMF), as of May 8, the total foreign currency reserves of the country were $19.82 billion.
Mohammad Mezbauul Haque, the spokesperson of Bangladesh Bank, informed that through the Asian Clearing Union (ACU), the central bank has paid off import bills totaling $1.63 billion over the past two months.
However, Bangladesh Bank maintains that after paying off the import bills, the foreign currency reserves now stand at $23.71 billion.
According to the Central Bank’s accounts, the reserves were $25.27 billion on May 8.
The Dhaka Stock Exchange (DSE) and the DSE Brokers Association (DBA) have expressed gratitude towards Prime Minister Sheikh Hasina for her directive to list government companies in the capital market, a move hailed as timely and positive.
The directive was issued during the recent meeting of the Executive Committee of the National Economic Council (Ecnec) last Thursday.
Dr. Hafiz Muhammad Hasan Babu, Chairman of DSE, described the directive as a significant step towards enhancing the dynamics of the capital market. He emphasized that besides invigorating the capital market, this move would also attract foreign investment and promote sustainable development.
Despite previous efforts, government institutions had not been listed in the stock exchange, according to a notification issued by the DSE. The Prime Minister’s directive is seen as a pivotal step towards revitalizing and expanding the economy.
Dr. Babu further remarked, “The listing of reputable companies in the capital market, as directed by the Prime Minister, will greatly benefit the country’s economy. It will also enhance investor confidence.”
Similarly, the DBA released a notification applauding the Prime Minister’s directive, terming it as positive and timely for the capital market.
Saiful Islam, President of DBA, expressed optimism about the directive’s potential to accelerate the country’s capital market and overall economy. He pledged support to relevant government departments and regulatory bodies in implementing the directive, ensuring its positive impact on the economy, including the capital market.
India has expressed interest in financing Bangladesh’s Teesta project, announced Foreign Minister Hasan Mahmud. Speaking to reporters after a meeting with Indian Foreign Secretary Vinay Mohan Kwatra, Mahmud stressed the importance of aligning the project with Bangladesh’s needs. He confirmed discussions on the Teesta issue during the meeting. Mahmud also affirmed Prime Minister Sheikh Hasina’s upcoming visit to New Delhi, indicating that the finalization of the date would depend on the formation of the new Indian government following ongoing elections.
Meanwhile, the IMF has approved a $1.15 billion staff-level loan for Bangladesh in its third tranche. Mahmud noted the ongoing elections in India and the subsequent formation of the new government as factors influencing the scheduling of PM Hasina’s visit.
When asked about the sequence of visits to India and China, Mahmud suggested Delhi’s geographical proximity to Bangladesh. Diplomatic sources suggest PM Hasina’s visit to India is planned for early July, following India’s elections.
Pre-election surveys indicate strong prospects for Indian Prime Minister Narendra Modi’s re-election. Modi previously congratulated PM Hasina on her electoral victory in January, expressing optimism about strengthening ties between the two nations.
The last bilateral engagement between the prime ministers occurred during the G-20 Leaders Summit in September 2023. Modi is expected to invite South Asian and BIMSTEC leaders to his swearing-in ceremony, fostering regional cooperation.
Addressing border killings, Mahmud emphasized the government’s commitment to ending such incidents and promoting the use of non-lethal weapons by border forces. Discussions also covered enhancing physical and people-to-people connectivity, including cooperation with India to import hydropower from Nepal and Bhutan through India. Mahmud highlighted the need to further ease visa restrictions to strengthen people-to-people relations.
