Editorial
How to achieve economic recovery?
The do's we can think of
That the economy is going through the most critical phase of our history needs hardly any elaboration. Still we need to pinpoint the problems to be set on a recovery course.
It is hemmed in all sides by adversities -- thanks to the two successive floods topped by a catastrophic cyclone and menacingly rising oil price in international market. Food deficit has reached a record height, imports are costly, local procurement is out of question, inflation rate is touching double digit and threatening to run away and purchasing power is lacking. At the same time, means of livelihood have been destroyed in large swathes and numerous people have become homeless.
On the employment front, investment, both local and foreign, have fallen sharply. We latch on the newly formed Business Forum to bring about fruitful interaction between the government and the business leaders to restore the lost confidence in the business environment.
In an evaluation of the economy, ADB chief Hua Du has expressed the hope that the second half of the current fiscal would be productive and the table could turn on the economy. Here is a recipe for a turn-around of the economy, partly borrowed from expert views and partly formulated by us.
The first pressing necessity is to feed at least ten million people through VGF cards along with the extension of food for work programme to include rest of the people under poverty line. Food imports are costly; and its procedures being time-taking, we may request the donors for food grants. Donors are coming forward, but since our deficit is so huge we have to move on a massive procurement drive overseas on an urgent basis. Let's simplify the procedures and release foreign currency for the purpose.
To provide purchasing power to the people who have lost everything, seed money should be provided to the farmers, fishermen, weavers and other working classes as outright grants. They need to buy cattlehead, implements, trawlers, fishing nets and looms to operate their crafts from a scratch, as it were. Soft-term house building loan should be provided on an emergency footing.
There has been an animated start to macro-level funding, both at the government and international levels. Government has announced Tk130crore worth of soft-loans to be distributed by PKSSF and its partner NGOs. The ADB itself along with other donor agencies are going to release a highly concessional US$ 180million loan for the flood victims. Another US$400million is already in the pipeline. More is being pledged by the international community.
The micro-credit NGOs are mulling over writing off Taka 600crore loans in the cyclone-hit districts. While they should do it there is a rationale for giving fresh micro-credit for the people in real distress to help them pick up their lives.
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