Plagues and epidemics have ravaged humanity throughout its existence, often changing the course of history and, at times, signaling the end of entire civilizations. Over the last century quite a number of plagues, epidemics have pulverised the human race.
The Spanish Flu (1918-1920), Asian Flu (1957-1958), H1N1 Swine Flu Pandemic (2009-2010) are few of the mentionable ones. Now, the humanity is affected by this Covid-19 (Coronavirus). All the plagues and epidemics have altered human history especially as far as the economy is concerned. This Covid-19 pandemic is expected to be no different and the worst thing is that it may have the greatest impact on the economic future of the world given the time in history that we stand.
Some of the world's leading economists have predicted that the world economy will go through a change that will leave many jobless and thereby may cause the biggest recession after the WWI. According to Carmen M. Reinhart, Professor of International Finance at Harvard Kennedy School, this pandemic is 'another nail in the coffin of globalization'. The economist argues that the coronavirus pandemic is the first crisis since the 1930s to hit both advanced and developing economies. The recessions may be deep and prolonged. As in the 1930s, sovereign defaults will likely spike. Calls to restrict trade and capital flows find fertile soil in bad times. Doubts about pre-coronavirus global supply chains, the safety of international travel, and, at the national level, concerns about self-sufficiency in necessities and resilience are all likely to persist-even after the pandemic is brought under control (which may itself prove a lengthy process). The post-coronavirus financial architecture may not take us all the way back to the pre-globalisation era of Bretton Woods, but the damage to international trade and finance is likely to be extensive and lasting.
Along with all of the above, for a country like Bangladesh, agriculture can play a big role in overcoming the upcoming challenges in the post-Covid-19 era. Bangladesh is already a country which depends quite heavily on agriculture. Almost 87 per cent of the rural population get at least some income from agriculture. However, two thirds of rural households rely on both farm and non-farm incomes. Pro-poor agriculture growth has stimulated the non-farm economy in Bangladesh: a 10 per cent rise in farm incomes generates a 6.0 per cent rise in non-farm incomes. As non-farm incomes continue to grow, the government needs to focus on fostering a more robust rural non-farm economy in the post- Covid-19 era.
What is promising is the fact that Bangladesh now comes 3rd when it comes to producing rice in the world. This is very positive news in this gloomy situation. It works in two ways, firstly, with this, we can feed the population of the country as well as think about exporting the crop. This will benefit the economy hugely. Creating job opportunities for the unemployed youths, this will help in earning foreign currencies as well. The rice production all over the world has not been that great compared to our country. We can certainly take advantage of this.
Jute is another most potential crop of Bangladesh. It was called the 'golden fiber' of Bangladesh. Keeping in mind the sustainability about which the world is currently quite wary of, jute can solve the problem. There are no reasons why jute-based products from Bangladesh cannot have a thriving presence in the world market. It is encouraging to see that Bangladesh is all set to begin commercial production of jute polymer-based bags, which, unlike plastic bags, are biodegradable and therefore, environmentally sustainable.
Apart from jute bags, Bangladesh should be looking to new and exciting products -- going beyond the obvious jute merchandise -- like jute charcoal and jute tea; and as younger consumers take a greater interest in the environmental impact of their buying habits, these products will be seen as trendy, thereby strengthening our economy even more. Jute-based fabric can be an option which may be explored in future for reaping the benefits.
Vegetable farming, especially organic vegetable farming, can be one of the brightest prospects when it comes to fighting the post Covid-19 era. Organic vegetables along with being environment-friendly, does bring the prospect of money as well. That is why, it is one of the options which needs to be pursued. Vegetable farming on the banks of rivers and on terraces has gained popularity. We need to capitalise on this opportunity.
Fisheries is another export product that we can look to capitalize on. According to our fisheries minister, Bangladesh exported 68,655 tonnes of fishes and fisheries products worth about Tk 38.45 billion (3,845 crore) in the fiscal year 2018-19. Bangladesh exports fishes and fisheries products to over 50 countries of the world, including the USA, China, Japan and Russia. About 68,655 tonnes of fishes and fisheries products were exported abroad in the outgoing fiscal year 2018-19, while Bangladesh collected revenue of Tk 38.45 billion (3,845 crore) ($455 million) by exporting fishes and fisheries products. Among the total export amount, 31,158 tons were shrimp worth Tk 29.16 billion (2,916 crore). So, as we can see it is already an established sector which just needs a little push. This can help immensely in solving our economic problem.
The government, realising the potential of agriculture, has included it in the stimulus package. Our Prime Minister has already declared to cultivate every pieces of unutilised land for ensuring food security in the future.
We can certainly use these agricultural products along with others to counter the demand in the upcoming years which are bound to be challenging. According to the World Bank, Bangladesh has great potential to raise agriculture-generated incomes, increase agricultural productivity and make it more resilient to climate change and improve the nutritional value of crops. We need to take this into consideration. Along with all these, a strong supply chain will be of utmost importance so that the product can reach the final consumer whether at home or abroad. In this way, Bangladesh will be well-placed to fight the economic woes in the years to come.
The writer is CFO of Mercantile Bank Ltd.