Businesses urge steps on law and order

Business leaders on Saturday expressed concern over the country's law and order situation that, they observed, has not improved to a satisfactory level despite ongoing efforts, leaving businesses under pressure.

They urged the government to hold talks with the business community and give immediate attention to restore the law and order situation as well as to lower interest rates on bank loans and carry out reforms to boost their confidence.

"Currently, Bangladesh is experiencing an unstable economic growth coupled with a few other challenges," Ashraf Ahmed, president of the Dhaka Chamber of Commerce and Industry (DCCI), told a seminar titled "Current State of the Economy and Outlook of Bangladesh" at the DCCI auditorium in the city.

The challenges affecting the economic stability include currency devaluation, rising inflation, financial sector instability, labour unrest, energy security and disruptions in key export industries, he added.

Mr Ahmed said the incidents of arson, vandalism, and looting at factories and business establishments are the immediate major concerns for the business community.

He also pointed out that some industries are struggling to pay workers as they are not getting enough funds from some banks and stressed the need for faster reforms in the banking governance.

He suggested addressing the problem with non-performing loans (NPLs) and liquidity issues as a priority measure to restore confidence in the financial system.

Taking part in the discussion, former president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) Mir Nasir Hossain expressed concern that the recent labour unrest has shattered our image in the global market.

He also said that not only the export-oriented industries but also the domestic market-based industries are similarly important.

Regarding the interest rate for manufacturing industries, he said the real effective rate of interest is too high in Bangladesh and it affects the entrepreneurs who compete with the international market.

In his address, president of the Leather Goods and Footwear Manufacturers and Exporters Association of Bangladesh (LFMEAB) Syed Nasim Manzur termed unfair criticism of the entire business community for the misdeeds of a few dishonest ones.

"We live in this country, invest here, and would do business here," he said, appreciating some prudent appointments in the government bodies such as the National Board of Revenue (NBR) and Bangladesh Bank as it already started showing positive results.

He further emphasised that the business community is suffering from insecurity and a lack of confidence as the labour unrest is now spreading to other industries too from the readymade garment sector.

"The government must address this issue with priority," said Mr Manzur, noting that established mechanisms such as tripartite negotiations exist to manage labour unrest.

He further stressed that a large economy like Bangladesh cannot rely solely on foreign aid and remittances and should focus on the domestic economy as well. "We must ensure the safety and confidence of our local investors and traders."

He also pointed out that domestic consumption - be it food or service - fell remarkably. He also said that the double-digit rate of interest on industrial loans is not viable for sustaining in the competitive market.

He said foreign direct investment (FDI) is needed for a country like Bangladesh, but due to low confidence it remains stagnant at present. He, however, expressed the hope that it would see a positive move soon.

Ahsan Khan Chowdhury, Chairman and CEO of Pran-RFL Group, stated that improving the law and order situation and resolving workers' dissatisfaction could create significant employment opportunities in the coming days.

"If we can resolve labour unrest and restore the law and order situation, we can create jobs for millions. Around 25 million people need employment opportunities and people are looking at us," he said during the seminar.

Reflecting on the student protests and worker dissatisfaction, he said the goal of such movements is to eliminate discrimination and improve conditions, including inflation control and employment opportunities.

"Businesspeople are patriots too; we want the country's development as well as job creation for the people. If we identify the problems, everything will return to normal soon. We are willing to work with the law enforcement agencies and follow their guidance," he added.

Sharing his experience of labour unrest at his factory, Chowdhury noted that this was the first such incident they had to encounter.

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said a good understanding and relation between the owners, workers and labour leaders can mitigate any unrest as well as violence in the factories.

Dr M Masrur Reaz, Chairman and CEO of the Policy Exchange Bangladesh, said that a right policy at the right time could not be taken, causing the recent macroeconomic crisis. Confidence level for investment is shattered now, law and order especially disorder in the 'order' part, labour unrest, and inflation are some of the pressing issues for the macroeconomic challenges for Bangladesh, he said.

Shams Mahmud, former president of the DCCI and managing director of Shasha Denims Limited, pointed out that the labour unrest disrupted the industrial production in the Ashulia region.

Unless the law and order situation becomes normal, the buyers' confidence would erode further and order may shift from Bangladesh to other competitors.

There may be issues related to wages and other matters and all these should be resolved through discussion, not by vandalism, he said. He also underscored that all possible protection should be given to SMEs and the import-substitute sectors.

Regarding NPL, he said that for the mismanagement of banks, genuine businesses should not suffer in getting loans and the banks should also be accountable for any mismanagement that happens.

Syed Mohammad Kamal, country manager of Mastercard Bangladesh, said from July-August, digital spending has remarkably fallen as consumption is in the downward trend.

He suggested incentivising digital payment systems over cash payment. At present, the remitters get 2.5 per cent incentive on their remittance sent to Bangladesh.

Ambareen Reza, Co-Founder, Chairman and CEO of Foodpanda Bangladesh and DCCI Senior Vice President Malik Talha Ismail Bari also spoke on the occasion.

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