Professor Mustafizur Rahman on impact of politics on Bangladesh Economy

Published in Al Jazeera on 13 March 2015.

Bloody blockade cripples Bangladesh economy

More than 100 people have been killed in clashes since opposition parties launched a nationwide blockade on January 6.

Syed Tashfin Chowdhury

Dhaka, Bangladesh – Noon had just passed and 52-year-old labourer Muhammad Babul was still standing with his bag of tools at a bus stop on the outskirts of Dhaka, waiting to be hired for the day.

Two months ago, he probably would have been hired by 8am – working at construction sites, painting houses, or doing plumbing work.

But on January 6, an alliance of 20 opposition parties led by the Bangladesh Nationalist Party called an indefinite, nationwide blockade to protest the arrest of their leader, former prime minister Khaleda Zia. The blockade entails laying siege to the entry and exit points of Bangladesh’s major cities, and vehicles carrying goods have been halted or come under attack.

Nearly 1,200 vehicles have come under arson attacks, and at least 112 people have died as of March 3. Of those, 72 died in arson attacks, and the remaining 40 people, mostly opposition activists, were killed while in the custody of law enforcement agencies, according to Dhaka-based human rights organisation Ain O Salish Kendra.

The opposition has denied carrying out arson attacks, blaming activists affiliated with the ruling party instead.

Since the blockade began, Babul has worked just eight days.

“I have not made more than 4,000 taka [$52] since the political situation deteriorated,” said Babul, the sole earner in his family of five.

Relatives of arson victims attend a rally holding photographs of family members as they protest the attacks [EPA]

A younger day labourer, Shubho, 32, has been even less fortunate. He said he has only worked five days since the blockade, and his four-member family is currently surviving on loans.

These workers pointed out that the usual employers – small construction firms, or sometimes individual households – have halted work until the political stalemate in Bangladesh eases.

Meanwhile, Bangladesh’s economy is reeling, with trade organisations estimating the country’s economy has suffered $21.7bn in losses as of March 9.

The government and the 20-party alliance, as it has become known, are sticking to their respective stances. If they choose to carry on with their daily work, most businessmen, traders and other professionals are left with no option but to risk their lives.

 

Falling exports

On January 5, the 20-party political alliance wanted to hold rallies to mark the anniversary of last year’s parliamentary elections as “Democracy-Killing Day” in Bangladesh. The international community criticised the 2014 elections, and the 20-party alliance boycotted the polls.

Instead of permitting the protests, the Bangladeshi government – led by the Awami League party – detained Khaleda Zia in her office, and arrested many of the alliance’s leaders. In response, Zia declared a nationwide blockade starting from January 6.

“The political unrest has affected people across all segments and stakeholders of all sectors,” said Professor Mustafizur Rahman, executive director of the Dhaka-based Centre for Policy Dialogue. “Besides a socio-psychological insecurity, the economy is affected through less foreign and local direct investment and lower number of export orders.”

Muhammad Helal Uddin, the vice president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), told Al Jazeera “the daily estimated financial loss to the economy due to the blockade and strikes is 27bn taka [$344 millon]”.

Bangladeshi exporters say their export revenue has fallen by 30-40 percent compared to last fiscal year.

“Before the blockade, I paid 13,000 taka ($166) per shipment to the port. This has increased to 40,000 taka ($510) per shipment due to the risks of attacks on highway,” Sazzad Amin, the managing director of Peak Apparels, told Al Jazeera.

Other factory owners pointed out there has been a drastic fall in the number of orders from foreign buyers, which are opting to deal with more stable countries instead. The Bangladesh Garments Manufacturers and Exporters Association have said the turbulence is causing the apparel sector to lose about 375m taka ($4.9m) a day.

There can be no dialogue between the Bangladesh government with terrorists when they are engaged in subversive activities.

Mahbubul Alam Hanif, joint general secretary of Awami League

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) Vice President Mohammad Hatem Ali told Al Jazeera, “we may not achieve the target of $27bn in export revenue for 2014-2015”. If so, this would be the first time in several years that Bangladesh’s apparel sector would fail to meet its export revenue target.

 

‘No dialogue’

Although the United Nations and the US have urged a dialogue between the 20-party alliance and the government to resolve the crisis, the ruling party is not interested.

Mahbubul Alam Hanif, the joint general secretary of Bangladesh’s ruling Awami League, referred to the arson attacks and other atrocities during the past two months as “subversive” and “acts of terrorism”.

“Such attacks and vandalism are not political acts,” he told Al Jazeera.

“There can be no dialogue between the Bangladesh government with terrorists when they are engaged in subversive activities.”

In addition to the blockade, the 20-party alliance has been enforcing labour strikes at businesses, schools and other organisations.

In a recent statement signed by BNP Joint Secretary General Salahuddin Ahmed, the 20-party alliance called for strikes beginning on March 2, with the goal of “condemning the killing of opposition members in the name of crossfire, protesting the mass arrests, and calling for restoration of democracy and voting rights”.

“Seeing no solution, businessmen and other professionals in Bangladesh have gone back to work while risking their lives. We can only hope that nobody will create problems for our work,” the FBCCI’s Helal Uddin said.