Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
Finance Adviser Dr Salehuddin Ahmed on Wednesday said the small and medium enterprise (SME) sector remains a key driver of economic growth and employment in Bangladesh, but its full potential is constrained by persistent challenges in financing, technology adoption, and global market integration.
Speaking as the chief guest at the "SME Foundation-ERF Media Award 2025" ceremony held at the Economic Reporters' Forum (ERF) office in the capital, Dr Salehuddin stressed the need for urgent reforms and a comprehensive strategy to unlock the sector's potential.
"The SME sector contributes just 26 per cent to Bangladesh's GDP-significantly lower than in peer economies, where the figure often exceeds 60 per cent," he said. "Despite the rhetoric around economic growth, the real strength lies in the SME sector. Yet, it remains underserved in terms of credit and policy support."
Dr Salehuddin pointed out that commercial banks are generally reluctant to finance SMEs, preferring large-scale loans instead. "Bankers prefer bulk lending and often neglect loan recovery. This mindset must change," he said, suggesting an expansion of the Bangladesh Bank's SME refinance scheme, with additional backing from the finance ministry.
To address financing challenges, the adviser proposed creating a digital SME database to increase transparency and improve credit access. "International investors demand data-driven insight. The finance ministry is ready to fund the development of this digital infrastructure," he said.
He also emphasised the need for technological upgrades in SME operations. Drawing a global parallel, Dr Salehuddin noted that world-renowned brands, including Rolex, are often produced by SMEs. "The belief that only large industries matter in advanced economies is misleading."
To enhance institutional capacity, he recommended the SME Foundation follow the model of the Palli Karma-Sahayak Foundation (PKSF), which has secured financing from development partners such as the World Bank.
However, he noted that governance and transparency are prerequisites for accessing such support.
On broader reforms, he said the government aims to implement several financial sector initiatives by December, including depositor protection and bank restructuring.
"Allocations have already been made in the budget. The interim government will start the process, and the next government should keep up the momentum," he added.
Urging constructive journalism, the adviser said negative reporting could mislead development partners. He cited an incident involving the National Board of Revenue (NBR) and the IMF, where a reform initiative was delayed due to a conflicting media report.
All four members of the award jury board -- Dr Md Mofizur Rahman, professor at the Department of Mass Communication and Journalism, University of Dhaka; Shamsul Huq Zahid, founder secretary and former president of the ERF, and editor of The Financial Express; Md Towhidul Islam, chief news editor at Jamuna TV; and Md Morshed Alam, deputy general manager of the SME Foundation -- were present at the event.
Five journalists from The Financial Express (FE) have been honoured with the SME Foundation-ERF Media Award 2025 for their outstanding reporting on issues related to the small and medium enterprise sector.
The award recipients are Special Correspondents FHM Humayun Kabir and Syful Islam, Senior Reporters Rezaul Karim and Jahidul Islam, and Staff Reporter Farhan Fardaus.
Finance adviser presented the awards at the ceremony.
In total, 21 journalists from national newspapers, television channels, and online media platforms were recognised at the event jointly organised by the Economic Reporters' Forum (ERF) and the SME Foundation.
Syful Islam was recognised for his reporting on the importance of research and reliable data in advancing SME sector development. FHM Humayun Kabir was awarded for highlighting the SME sector's role in reducing unemployment and creating new job opportunities.
Rezaul Karim received the award for his report addressing marketing challenges faced by SMEs and offering strategies for improvement. Jahidul Islam was honoured for his comparative analysis of Bangladesh's SME development in relation to neighbouring and developed countries, along with his policy recommendations.
Farhan Fardaus received recognition for his report titled "Insufficient Support for the SME Sector: Recommendations for Action in the Budget," which identified gaps in support and proposed measures for policy reform.
SME Foundation Chairperson Mushfiqur Rahman, present as special guest, said the foundation lacks the capacity to meet the financing needs of the country's estimated 11.8 million micro, small and medium enterprises.
"To date, we have supported only 11,000 enterprises, less than 0.1 per cent, but with a loan recovery rate of over 99 per cent."
He urged the finance adviser to enhance the foundation's budgetary allocation to expand outreach.
Managing Director Anwar Hossain Chowdhury added that since its inception in 2006, the foundation has relied on income from a Tk 2.0 billion seed fund and an additional Tk 3.0 billion from a Covid-19 stimulus package.
He underscored the need for a permanent office and facilities like training, incubation, and display centres to help SMEs scale up.
ERF President Doulat Akter Mala and General Secretary Abul Kashem also spoke at the event, which was moderated by Kashem.
jahid.rn@gmail.com