Editorial
IMF comes calling
Potential for growth underscored
RODRIGO Cuberto, chief of an International Monetary Fund (IMF) mission to Dhaka has conveyed both good and bad tidings to Bangladesh. The RMG sector was singled out as providing the best opportunity in the near term for the country to earn foreign exchange. Yet, incidents like building collapses and fires in the sector merely help point out the dire need for better infrastructure – a key ingredient that policymakers need to pay attention to, along with power and transport sectors to propel Bangladesh's future growth.
One point made by the visiting team is that workers' productivity in the garments sector still lags behind competitors in the region. Whereas the global standard is at 80 on a scale of 100minutes, Bangladesh trails at 35minutes. Such underperformance in productivity has been linked to lower wages, a contentious issue that has yet to be resolved; but it is hoped that the wage board formed to look into the issue will bring better tidings in November.
In its macroeconomic assessment of Bangladesh, the IMF believes that a higher productive level could help unleash higher industrial growth. Despite having strong potentials for further development, the continued political stalemate could derail the growth potential Bangladesh has. A reduction in acrimony between the two major political blocs coupled with peaceful national elections would ensure the economy rebounding in the short-term and its eventual recovery in the mid-term. The opposite would bring economic turbulence and erode business confidence, something the country can ill afford.
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