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Monday, January 18, 2021 11:01:16 PM
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Economy Poverty Reduction Growth Slows

Dr. Md. Shairul Mashreque

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03rd-Jan-2021       
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The whole world, including Bangladesh, faces the global health crisis, as covid19 created havoc.   It continues to tell heavily upon normal economic development process.  The authorities find it hard to overcome backslide. Several developing and poor countries have benefitted from social safety net.
By now the serious health crisis is the expansion of coronavirus or Covid-19. Tension of the poor having no or less safety measures has appallingly increased; so theme of safety has changed its paradigm in the context of Covid-19. Not only poor, all citizens must be protected through safety net with social distancing, quarantine, life saving medicine and foods. Programs unreachable to the poor must be brought under social safety net.  In a bid to enable the poor absorb the shock of COVID-19 impact, the budget for next fiscal (FY21) proposed an allocation of Tk 955.74 billion for the social security sector, which is 16.83 per cent of total proposed budget and 3.01 per cent of GDP. In the revised budget of the ongoing fiscal (FY20), the allocation was Tk. 818.65 billion.
The government is to increase the scope of various social security programmes in the budget for fiscal year 2020-21 in response to the Covid-19 pandemic, and about Tk 88,000 crore has been allocated for this. At present, about one-fourth of families are covered by social security. The government has announced it will be double the number of beneficiaries by 2023. Also, there are about 79 lakh beneficiaries under the social security net at present. It was learned that this number may reach around one crore in the next financial year. In the budget for the current financial year, Tk 74,367 crore has been allocated for the social security sector.
More than three crore people of the country are already living below the poverty line. According to various surveys by private organisations, the impact of the novel coronavirus on the economy and trade could push another three crore people below the poverty line.
Reports are plenty mentioning the tremendous growth of tycoons. This is not a good sign. It goes against resilient economic growth.  There must be realistic public policy to maintain a modicum of balance. This is what policy makers want. Yet malfeasance in financial management with influential pulling the string from behind the scene creates conditions conducive for the unscrupulous persons to make money. Many critics pointed finger at governing elites creating a chunk of opportunities for self-seeking and fortune seeking snobs   to become multi millionaire.  
According to very recent news reports, Bangladesh has topped the list of countries that saw the quickest growth in the number of ultra-wealthy people between 2012 and 2017. According to the latest World Ultra Wealth Report 2018 by WEALTH-X, the ultra-high net worth (UHNW) population in Bangladesh posted a 17.3 percent growth over the last six years (2012-17) surpassing all other countries of the world. UHNW refers to individuals with a net worth of 30 million USD or more. US-based WEALTH-X provides intelligence and market research on UHNW. In its latest report released on September 5, WEALTH- X found only five countries in the world which have posted double digit growth in rise of their riches' numbers and these countries are: Bangladesh (17.3 percent), China (13.4), Vietnam (12.7), Kenya (11.7) and India (10.7).
The report states, "Looking at a broader range of nations, China - perhaps surprisingly - is not the global leader. That status lies with Bangladesh, which has registered compound annual growth in its UHNW population of 17.3 % since 2012. Double-digit increases have also been posted by Vietnam, Kenya and India, illustrating the significant opportunities for wealth creation across the emerging world." The five other countries which made it to the top 10 in terms of higher rise of the rich population are: Hong Kong (9.3 percent), Ireland (9.1), Israel (8.6), Pakistan (8.4) and United States (8.1). The report says number of rich (UHNW) rose by 12.9 percent globally to 255,810 people, a sharp acceleration from a year earlier. Their combined wealth surged by 16.3 percent to $31.5 trillion, implying healthy gains in average net worth.
The reasons for this perhaps are not far to seek   Opportunities for money making are not fairly provided by the state.  Manipulation has crept into the distributional profile. Manipulation appears to be function of the governing elites. The contemporary scenario of corruption in the wake of fuzzy governance is a manipulation by the dominant interest group-the coalition of interests among "governing elites," "fortune seeking political entrepreneurs" and privileged groups. This seems to e a function of connectivity. Governing elites include both political leadership and bureaucracy. It is seen that governing elites expand various opportunities for economic concentration including rent-seeking ones. It ultimately aggravates the poverty situation threatening the legitimacy of the regime and increasing the probability of regime turn over.
Manipulation has of late degenerated into criminalization. Bangladesh syndrome of criminalization has diverse manifestations like rampant politicization and partisanization, toll extortion, forced occupation of land, commercialization of politics and criminalization of business and syndication. Criminalization started to mushroom in Bangladesh when things stumbled onto misgovernance with state failing to stem the rot.  The propensity to corruption is inherent in misgovernance.  Corruption has acquired a pervasive character devouring economy as a whole.
It is clear from many studies that corruption thrives in the midst of criminalization of politics. Corrupt practice in various forms continues to engulf all strategic institutions undermining governance. It is so deeply in field level extensions departments for rural development with the reinforcement of criminalization and syndication that it seems impossible to break its vicious chain. The environment around bureaucracy and political arena has become inordinately vitiated to give way to institutionalization of corruption.
A true dinosaur of corruption has reigned supreme under the manipulative design of fortune seeking rural leaders to weaken political stability and economic resilience. Local touts active in rural politics have been immensely benefited from Machiavellian syndrome of politicization while the honest has been sidelined.
Nevertheless hard facts about the lives of the 'last' but not least are starvation, half meal, malnutrition, disease, epidemics, poor housing and unhygienic living conditions, ill treatment by the security forces and fear of hooliganism. Many a study on human development presents a pen picture about a grim poverty situation touching upon hard facts about the suffering masses remaining at the outer margin of development policies.

(Dr. Md. Shairul Mashreque, Professor (Rtd.), Dept of Public Administration,
Chittagong University)

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