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The Financial Express

Post-Covid, post-war, post-LDC challenges


- Representational image - Representational image

Repetition of even serious issues such as climate change in the global media not just sensitises public opinion, the popular appeal of it is also diminished as a consequence. In a disastrous scenario of excessive global warming and talks of reparations from the carbon emitters, the possible impact of global climate actions on Bangladesh's trade and industrial activities often goes out of sight. 

Some of the Bangladesh industries may face duty penalty after 2026 in case they produce goods with fossil fuel and export them to Europe, for example. Stakeholders are more or less aware of the risks but it's not known exactly how the country will increase generation of renewable energy for industrial use to comply with environmental rules. 

Bangladesh is set to lose some duty concessions while exporting goods to developed and developing countries once the process of graduation from the least developed country is completed in 2026. Before that, by 2024, Dhaka will have to start spending a much higher amount of budgetary allocation every year for servicing debts of big infrastructure projects. 

While such 'somewhat distant' challenges are yet to be fully understood, the Covid-19 pandemic since 2020 and Russia's invasion of Ukraine leading to a full-scale war since February and the US-China stand-off in East Asia, have brought fresh uncertainties. Food price-hike, energy market volatility, rising costs of international trade, and exchange rate fluctuations are some of the symptoms that proved to have severer effects on the Bangladesh market and consumers. 

The Bangladesh government announced stimulus packages at a time the pandemic brought normal life to a halt and an economic rebound was expected following drastic fall of coronavirus cases early this year. In the meantime, the war in Ukraine has disturbed the trend of recovery. 

Now, Bangladesh is facing multiple challenges on multiple fronts. Post-Covid time is fraught with uncertainties because of the war in the Black sea region, tensions in Asia, the LDC graduation at a crucial time and a lack of actions to counter climate-change effects. 

However, there is hardly any scope to deal with each issue on a piece-meal basis as they are inter-related and a series of events and policy shortcomings have complicated them. 

Their solutions lie on how the country's domestic situation and the external environment are assessed and policy packages for the coming days and years prepared. 

In the present context, consultations with various stakeholders are critically important for taking stock of the difficulties and risks in order to find pragmatic solutions to the issues at hand. Such dialogues can also help formulate a consensus on required policies including foreign policy options for maximising national interests. 

The Russia-Ukraine war has left difficult choices for countries like Bangladesh. Apart from exposing the crisis of sharing global resources among the nations, the war has changed the world's polarisation bringing back the Cold War-like division - between the United States-led West and China having friendly ties with Russia. 

This is going to influence the pattern of global trade and other negotiations as well as medium-size and smaller countries' alignment with great powers. 

Bangladesh, with a large Diaspora and millions of overseas migrant workers, will have to walk through difficult terrains of superpower rivalries and for sales and purchase of commodities and services, inclusive of defence materials. 

Furthermore, the civil war in its neighbourhood in the extreme southeast has had direct implications when Myanmar is yet to take back its one million Rohingya people now living in camps in Bangladesh. 

Overall, Bangladesh's national policies and economic development are more connected to matters of external relations. The nation's preparations today will indicate how the country will fare in the coming years, domestically and internationally. 

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