Private sector confidence takes a hit due to corona-induced uncertainties24 July 2020
A recent study, launched by LightCastle Partners, found that top executives of the private sector have low confidence regarding the country's economy in the coming months.
LightCastle launched the third edition of its study titled 'LightCastle Business Confidence Index (BCI) 2019-20' through a webinar in the capital today (Thursday).
LightCastle is a consulting firm for creating data-driven opportunities for growth for development partners, corporations, startups and SMEs.
As part of the launch, LightCastle also hosted a panel discussion with four experts from their relative fields.
The panel included Masrur Reaz, Chairman, Policy Exchange Bangladesh; Nihad Kabir, President, Metropolitan Chamber of Commerce & Industry (MCCI); Asif Ibrahim, Chairman, Chittagong Stock Exchange (CSE); and Nasir Uddin Ahmed, Former Chairman, National Board of Revenue (NBR).
The BCI report aims at gauging the business sentiments of private sector leaders (CXO members) across 20+ sectors, having a notable contribution to Bangladesh's economy.
This year's business confidence is found to be critically low, -19.27, influenced largely by the pandemic induced uncertainties and the fragile state of the financial sector even before the global crisis.
The previous editions of the report saw the private sector confidence at +43 (2018) and +39 (2017) respectively. The index is determined on a scale of -100 to +100 using Harmonized Expectation Indicator (HEI).
Key problem areas on a macro level were the diminishing export receipts and reduced foreign remittances: the two fundamentals in which the nation's economy is dependent upon. Mr. Asif Ibrahim mentioned that "We have to look at the global trends of RMG manufacturing and start implementing them in Bangladesh. We need to look into lean manufacturing where we reduce wastage and increase productivity."
Opening up on doing business globally, Mr. Masrur Reza mentioned that "Bangladesh has zero Free Trade Agreements. We will need to establish bilateral trade agreements before graduating from Least developed countries (LDCs) status."
On a macro level, depleted demand, curtailed capacity and inadequate infrastructure were highlighted as the major bottlenecks. Based on these factors, 80% of C-suite members surveyed believe that the performance of the economy would deteriorate in the coming 6 months.