while addressing the session “Asian Growth: Realities and Challenges” at an International Conference on “Global Economic Recovery: Asian Perspectives,” organised by International Chamber of Commerce, Bangladesh, on 26 October 2014.
More news reports on the event
Published in The Daily Star on Monday, 27 October 2014.
Don’t mix business with politics
Economists suggest at ICCB conference on global economic recovery
Star Business Report
Asian countries including Bangladesh must keep politics aside from business for the betterment of economy, analysts said yesterday.
“Economics and politics must be separated. Politics should not be in business and business should not be in politics,” said MA Taslim, an economics professor at Dhaka University.
“Unfortunately, it is happening in major parts of Asia,” he said, adding that democratic countries like Bangladesh must be careful as there is a difference between market and political forces.
The country should not follow the same principles as autocratic governments, Taslim added.
Politics seriously affected business in Bangladesh, said Hossain Zillur Rahman, former adviser to a caretaker government.
He too called for keeping the economy free from political influence for higher economic growth.
They spoke at a session styled ‘Asian Growth: Realities and Challenges’ during International Chamber of Commerce Bangladesh’s two-day international conference.
Trade is the most dominant factor in the Asian economy, said AB Mirza Azizul Islam, former finance adviser to caretaker government.
The main challenges to the Asian economy are slow growth of exports, exchange rate stability, and reduction of income inequality, he said.
Trade restriction imposed by developed countries is another challenge for high GDP growth in the Asian country.
The Asian Development Bank projects regional growth to pick up to 6.2 percent in 2014 and 6.4 percent in 2015 for most Asian countries.
Although Asia has made major strides since the 2008-09 global recession, not all countries are out of the woods, he added.
Sadiq Ahmed, vice-chairman of Policy Research Institute of Bangladesh, said developing Asia continues to do substantially better than the rest of the world on the growth front despite a slowdown in global economy.
With its rising share of world income and trade there is a good chance that Asia will lead the way for global recovery, he said, adding that much depends on what happens in India and China.
The basic fundamentals are strong in the giant Asian economies, with India expected to get back to the 6-7 percent growth trajectory and China to 7-8 percent, he said.
“Along with restoration of stability and growth in advanced economies in 2-3 percent range, these performances can be an important pull factor for global recovery.”
The stronger long-term growth performance of developing Asia is mainly explained by economic fundamentals, according to Ahmed.
The higher growth is spurred by a rapidly rising national investment rate and expansion of exports.
“South Asia has been a bit of a laggard and export-orientation and trade openness started very late in the day. But slowly, it is catching up.”
Asia has done much better than others during the financial crisis of 2008-09 mainly due to better performance of the Chinese and Indian economies, said Debapriya Bhattacharya, distinguished fellow of the Centre for Policy Dialogue.
“’Chindia’ has driven the growth in Asia,” he said, while slotting the Asian economies into three categories of “Dazzling, Dancing and Dazed”.
Dazzling Asia includes the higher income countries like Japan, Singapore and South Korea; Dancing Asia has the upcoming China, India and Malaysia and the dormant economies of Bangladesh, Nepal, Pakistan and Sri Lanka form the Dazed Asia.
Bhattacharya stressed more integration between the Asian countries for sustained economic growth.
Dazed Asia should establish a new phase of relationship in terms of sub-divisional or connectivity projects with other Asian countries.
Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association, said regional cooperation is necessary for the overall development of the Asian economy. Aftab-ul Islam, president of American Chamber of Commerce in Bangladesh, said regional cooperation does not get a momentum in South Asia mainly due to mistrust among neighbouring countries.
He stressed the need for enhancing people-to-people contact in the region with more exchanges between businesspersons and civil society members.
South Asian countries can benefit immensely from cooperating with each other, he said, while citing Nepal’s capability to address the region’s electricity shortage with its 80,000 megawatts of hydropower.
Sultan Hafeez Rahman, executive director of Brac Institute of Governance and Development, said Asian countries have to be more open and should invest in fundamental research.
Adeeb Hossain Khan, council member of the Institute of Chartered Accountants of Bangladesh, said Bangladesh is gradually getting importance on the global front due to its larger population base.
As a result, Japan’s Honda and Uniqlo and India’s CEAT have already set up operations in Bangladesh, he said. Salehuddin Ahmed, former governor of Bangladesh Bank, also emphasised more regional cooperation.
“Asia cannot grow alone.”
Published in Dhaka Tribune
Political conflicts push Asian economies at risk
Tribune Report
Politics should not be in business and business should not be in politics
Political conflicts might put economic growth of Asian countries, which have already been badly shaken by the global recession, under serious risks, trade experts and economists feared yesterday.
To take the region a leap forward, they emphasised on economic integration and massive investment in developing infrastructure and also on human resources.
The observations were made by the country’s heavyweight 10 economists at the concluding day of a two-day international conference, organised by the International Chamber of Commerce, Bangladesh (ICC,B) at a city hotel.
The deliberations were made in the business session on Asian Growth: Realities and Challenges, with former finance adviser to the caretaker government Mirza Azizul Islam in the chair.
“Politics should not be in business and business should not be in politics,” said MA Taslim, a professor of economics at Dhaka University.
He said relationship between the democracy and the economics must be kept separate, otherwise, both will be at risk. “Unfortunately, in major parts of the Asia, including Bangladesh, the democracy is at risk because of political conflicts.”
He noted that business should be allowed to operate freely on the basis of market forces (demand and supply) without any intervention by the political forces.
“If this does not happen, economy will not be stabilised in the region,” Taslim said.
The political conflicts starting from the West to East have already jeopardised the world’s economy, he added.
Echoing Taslim, eminent economist and sociologist Hossain Zillur Rahman said: “Politics in the developing nations have now become a ‘crony business’ leading to abuses of taxed-money by a group of people loyal to the party in power.”
Hossain Zillur, also a former adviser to the caretaker government, also noted that the growth acceleration is now emerged as the key issue in the developing nations including Bangladesh simply due to the misuses of political power and the poor governances.
“Resilience is an achievement by the nations including Bangladesh and we have to expand and come out of the cycle of around 6% economic growth.”
American Chamber in Bangladesh (AMCHAM) President Aftab-ul-Islam said Asia involved in political problems.
“India-Pakistan conflict is one of them and such type of clashes lead to the mistrust among the nations,” he said.
Taslim also put emphasis on the investment in the field of infrastructure, education, trainings and anti-environment pollution including impact of climate changes.
Policy Research Institute of Bangladesh (PRI) vice-chairman Sadiq Ahmed, however, said: “Developing Asia has been doing better than the rest of the world on the growth front despite slowdown in global economy.”
With its rising share of world income and trade, still there are good prospects that Asia will lead the way for global recovery, he said.
Terming the basic fundamentals of China and India are strong, Ahmed said: “With concerted domestics reforms, it is expected that growth will recover to 6-7% in India and stabilise at around 7-8% in China.”
He said along with restoration of stability and growth in advanced economics in the range of 2-3%, these performances can be an important pushing factor for global recovery.
Centre for Policy Dialogue (CPD) distinguished fellow Debapriya Bhattacharya said: “Asia has three types of trends in terms of economic indicators —dazzling, dancing and the dazed economies.”
He also noted that the Asian economies had been growing in terms of its share in the global economy.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Md Atiqul Islam said, “Bangladesh has adequate room for expanding its exports to both in the Asia and the rest of the world.”
Citing the McKinsey report on Bangladesh’s garments, BGMEA chief opined that Bangladesh now needs five Ps’ (people, power, place, port and politics) for boosting its exports to US$40bn.
Councillor member at the Institute of Chartered Accountants of Bangladesh Adeeb Hossain Khan said Asia should now focus on its own market the region and their respective domestic markets following squeezes in the growth outside the Asia.
The function was addressed, among others, by former governor of Bangladesh Bank Salehuddin Ahmed, executive director of the BRAC Institute of Governance and Development Sultan Hafeez Rahman.
Published in New Age
Asian recovery to be driven by regional growth: experts
Tariff, non-tariff barriers hamper trade integration in S Asia
Staff Correspondent
The Asian economic recovery will be driven by the continental growth and China-India relations after the world economic crisis, said speakers on Sunday at a seminar organised by the International Chambers of Commerce Bangladesh.
They also pointed out that tariff and non-tariff barriers hamper the trade integration in South Asia and suggested that formation of a South Asian custom union would solve the problem.
Promotion of interregional Asian export, not just the raw materials but the finished goods, is important, they said.
The ICCB organised a two-day conference on ‘Global Economic Recovery: Asian Perspective’ to mark its 20th anniversary.
‘From the two days of deliberations by experts and stakeholders from home and abroad we find that Asian growth will be driven by regional growth, political cooperation among the states of the region and China-India relations,’ ICCB president Mahbubur Rahman told reporters at a press briefing after the conference.
He, however, said that the sustainability of the Asian recovery would depend on the recovery of the rest of the world after the global economic meltdown in 2008.
‘We are in a phase of recovery though Bangladesh was hit less hard than others. We need to be prepared for any such unforeseen economic disaster,’ he said.
He said that in the two-day seminar there were one plenary session and three business sessions which were attended by 450 participants and 40 speakers from 10 countries.
‘We are at the recovery phase but in the South Asian context we need to draw a line between the politics and business. We need to understand that politic is not business and business is not politics,’ Dhaka University economics teacher Md Ali Taslim said while speaking at a business session earlier on the day.
He also said that during the recovery and development process the environmental issue would be crucial.
‘Environmental risks are the worst and Bangladesh could be a significant sufferer of the problems if we don’t take care of those,’ he said.
Former caretaker government adviser Hossain Zillur Rahman said that the recovery of the Asian economy would go through the process from resilience to growth acceleration.
‘Political commitment and proper policy support are the keys to such transformation. Earlier we used to think western liberal democracy was the answer to all the problems but now countries like China and Japan also have made their names,’ he said.
Bangladesh Garment Manufacturers & Exporters Association president Atiqul Islam said that the country was growing as well as the other Asian economies.
‘After the tragic Rana Plaza incident we faced factory inspection by the western buyers and less than two per cent of our factories were found faulty. Now the sustainability compact and factory inspection should be applicable for other countries otherwise we will lose the competitiveness,’ he said.
Centre for Policy Dialogue distinguished fellow Debapriya Bhattacharya, however, said that development of Asia was not only depend on China and India.
‘The growth is much more elaborated than that,’ he said.
Johannes Zutt, Bangladesh country director of the World Bank, said that the South Asian countries needed more investment in order to maintain decent growth.
‘Tackling corruption and maintaining political stability are the key challenges for most of the South Asian countries as long as growth is concerned,’ he said.
He said that the region was hit hard by the global financial crisis as the growth of the region was cut down by half in recent years.
‘The South Asian countries can grab the manufacturing industry of the East Asia banking on the low labour cost in the region,’ he said.
The sparkers at the seminar stressed on attracting more investment from the region and better connectivity among the countries.
They said that government and central banks in Asia should promote development of regional bond market in order to keep the regional savings in real sector investment as financial sector was under stress in some Asian countries.
They also said that there should less government interference and more governance in order to achieve inclusive and sustainable economic growth.