High Growth not sustainable if inequality continues to rise
The country’s higher economic growth will not be sustainable if inequality continues to rise at the current pace, economists and politicians said yesterday. Most of the people have not benefited from the higher growth. Bangladesh has achieved more than 8 percent GDP growth, which is highly praiseworthy but only one percent of the total population is reaping the benefits of growth. Ninety percent of assets in the country are controlled by 10 percent ultra-wealthy persons which is hampering the economic progress. A seminar titled “Development, Deprivation and Inequality” organized by the Workers’ Party of Bangladesh at the Institution of Engineers, Bangladesh in Dhaka. There is a strong link between development, deprivation and inequality and sustainable development has a role in removing the deprivation and inequality. As per the latest Household Income and Expenditure Survey [HIES], the country’s Gini coefficient, which is the economic measure of equality, stood at 0.482 in 2016, up from 0.458 in 2010, in a worrying development. The Gini coefficient is measured on a scale of 0 to 1; the closer it is to 1, the higher the inequality is in the society. Islam of the BEA said Bangladesh’s per capita income is now estimated to be $1,909 but the figure is applicable for only 1-2 lakh people, meaning the majority of the population have not benefited from the outcome of the ongoing development. In the last 48 years, the country has not reformed agriculture and land and adding that South Korea and Taiwan have done it successfully, which helped them accelerate sustainable development.
BGMEA to get Knowhow on better Sewing Skills
Sudokkho, a United Kingdom and Switzerland-funded programme, will provide technical assistance to the Bangladesh Garment Manufacturers and Exporters Association [BGMEA] on imparting training on skills enhancement of sewing machine operators. The skills can be enhanced in 15 to 20 days, raising efficiency on the production floor at 45 to 65 percent. An agreement was signed in this regard by Ms. Rubana Huq, president of the BGMEA, and Erling Petersen, team leader of Sudokkho, in Dhaka. The deal includes transferring Sudokkho’s knowhow into the academic curriculum of the BGMEA University of Fashion and Technology. Moreover, the RMG and Textile Industry Skills Council and BGMEA-affiliated training centres will also get technical assistance under the agreement. Sudokkho has established in-house training centres in over 120 factories.
Country’s first Pvt Equity Fund launched
LankaBangla Asset Management Company Ltd. [LBAMCL] launched the country’s first Private Equity fund – LankaBangla 1st PE fund recently. LankaBangla Securities Ltd is the sponsor of the fund and Green Delta Insurance Company Ltd is the trustee. The fund size will be BDT 250 million with a tenure of 10 years. This is the first private equity fund to be registered under the “Bangladesh Securities and Exchange Commission [Alternative Investment] Rules, 2015. Private equity funds usually raise funds from eligible investors and invest with higher focus on privately held equities and equity linked instruments. Typically, investment in private equity funds lead to higher capital appreciation and dividend prospect compared to traditional mutual funds. This fund aims to invest in Information Technology& IT enabled service, Pharmaceuticals &Health, Agriculture & Food, Resource Efficiency and Light Engineering sectors. Globally, private equity funds are a popular investment vehicle with assets under management of USD 5.8 trillion.
Dhaka to host ‘Showcase Malaysia’ in December
Dhaka will host the ‘6th Showcase Malaysia’ in December, said Bangladesh-Malaysia Chamber of Commerce and Industry [BMCCI]. The BMCCI made the announcement at a ceremony at the chamber office in the capital on Saturday marking the 62nd Independence Day of Malaysia. The three-day exposition is scheduled to be held on December 3-5. Malaysia’s Acting High Commissioner in Dhaka Mr. Amir Farid Abu Hasan was present at the Southeast Asian country’s Independence Day celebration programme. Addressing the programme, he highlighted the colourful story of Malaysia’s successful transformation from a newly-independent third world country to one of the most successful states in the globe today. Malaysia’s total trade with Bangladesh was US $2.37 billion last year, a 35.6 per cent increase compared to that a year before. Bangladesh’s total export was $2.8 billion in June, 2019, while total import stood at $3.9 billion, registering an increase of 3.4 per cent year on year. Bangladesh’s export to Malaysia, however, was only $260 million at the same time.
Move on to cut MFI Interest Rates
A move is well under way to slash existing service charges imposed by Micro-Finance Institutions [MFIs] with intent to give poor borrowers some relief. To this end, Financial Institutions Division [FID] has recently sent a proposal to finance division. It was made in line with the recommendations from an eight-man committee led by Palli Karma Sahayak Foundation Chairman Dr Qazi Kholiquzzaman Ahmad. The Dhaka University Economics Professor is also on the eight-member committee. The panel proposed to reduce 23 per cent in a declining balance method from existing rate of 27 per cent. An MFI with less than Tk 250-million outstanding loans should be treated as small and the one with more than Tk 250 million large as per the June 2017 baseline. Beside, large MFIs will spend 15 per cent of their surplus funds for clients and family members as part of Corporate Social Responsibility [CSR] annually.
RAKUB disburses Tk 257.5m SME Loan in eight Districts
SME Financing Company Limited, a subsidiary company of Rajshahi Krishi Unnayan Bank [RAKUB], has disbursed Small and Medium Enterprise [SME] loan worth Tk 257.5 million [Tk 25.75 crore] aiming at promoting the sector in different potential areas of Rajshahi region in the last financial year, reports BSS. The company also recovered loan of Tk 202.2 million [Tk 20.22 crore] attaining profit of Tk 44.2 million [Tk 4.42 crore] in fiscal year 2018-19 [FY ’19]. This was revealed in the 23rd meeting of the governing council of the company at the board room of RAKUB headquarters in Rajshahi city. SME promotion is very important for reducing the existing gap between rural and urban areas. Main objectives of the loans are creating an intensive investment scope for the agro-based SMEs in the light of the government’s Industrial Policy and for supplementing the government’s efforts to attain food security and economic emancipation. Various business fields especially software, agro-processing and its business, agriculture, plantation, fisheries, poultry, tissue culture, leather goods, health service and diagnostic centers and education services have been selected for investment as Small and Medium Enterprise Loans.
Local and Global Stock Indices *
|Index Name||Close Value||Value Change||Percentage Change|
|FTSE100||7,207.18|| ↑22.86 ||↑0.32%|
|Nikkei 225|| 20,704.37 ||↑243.44||↑243.44|
World Commodities *
|Commodity||Close Value||Value Change||Percentage Change|
|Crude Oil (WTI)||$ 55.10 ||↓1.61||↓2.84%|
|Crude Oil (Brent)||$ 59.25 ||↓1.24||↓2.05%|
|Gold Spot||$ 1,520.38 ||↓7.25||↓0.47% |
Major Currencies Exchange Rates Movement in Last Seven Days *
|USD 1||BDT 82.8700|
|GBP 1||BDT 100.738|
|EUR 1||BDT 91.0335|
|INR 1||BDT 1.15411|
*CURRENCIES AND COMMODITIES ARE TAKEN FROM BLOOMBERG.<