Monday World Business News

Mirza Aziz sees economy doing well Blasts affluent society for casting dark cloud United News of Bangladesh . Dhaka
The finance adviser, Mirza AB Azizul Islam, on Sunday came down heavily on the affluent society in the capital for ‘casting dark clouds over the economy’ although it ‘has been doing reasonably well compared to the economies in neighbouring countries.’ ‘Those of us living in the capital city always see dark clouds all over, there’s no silver lining. We say the economy tumbled,’ he told a meeting of foreign investors, operating in Bangladesh, at Hotel Sheraton. ‘The heat of inflation is definitely a dark cloud, which we’ve not been able to avoid. Though we’re not engulfed, the poor people were really hit,’ the finance adviser said. He, however, said Bangladesh was not doing so bad as compared to food surplus countries like India and Vietnam who were respectively suffering from 11.9 and 25 per cent inflation. The adviser said the slightly lower GDP growth than previous fiscal year’s 6.43 per cent would be achieved, although the economy was confronted with so many challenges both from internal (two successive floods followed by devastating cyclone Sidr) and external (food, fuel and fertiliser price) shocks. Compared with regional economic growth, he said, the economy ‘certainly is not dismal, even we can say satisfactory.’ He added that the growth of Chinese and Indian economy would at least be one per cent lower than their earlier estimates. Mirza Aziz said one would see a little decline in investment as the just out fiscal year registered investment at 24.2 per cent of the GDP as compared to 24.46 per cent of the previous fiscal year. ‘This is by no means alarming.’ About the criticism that the government has mortgaged the country’s future to external debt, he argued that the debt service as proportionate to exports rather declined to 5.1 per cent in 2007-08 from 5.5 per cent in the previous fiscal year. The finance adviser dismissed the allegation that the banking system was suffering from the liquidity crisis to dry up private sector lending. He said he had carried out an investigation in a bank that claimed liquidity problem and found an additional fund of Tk 166 crore. He added that agriculture credit increased by 61 per cent and industrial credit rose by 66 per cent (July-March) during the last fiscal year while the industrialists did not keep the borrowed money under mattress. ‘The overall private sector credit grew 19.5 per cent during July-April period of the last fiscal year,’ he said, adding that the credit growth was by no means lower. Replying to a question, the finance adviser said the bank deposit rate increased due to rise in inflation. ‘Banks are offering a minimum positive rate of return to the savers… even it will not entail a significant rise in lending rate.’ The Foreign Investors’ Chamber of Commerce and Industry president, Waliur Rahman Bhuiyan, welcomed the guests at their monthly luncheon meeting.