Business Activity Stalls Amid Inflation, Investment Drought and Multiple Crises, Entrepreneurs Deeply Alarmed

❐ BD Digest Desk

The country’s business and trade has slowed significantly due to various crises including the deterioration of law and order, instability in the banking sector, and energy crisis. Consumer demand is declining due to high inflation, resulting in a decline in sales. In addition, stagnation in new investments and the downward trend in economic indicators have created new concerns among entrepreneurs.

In the overall situation, the demand for coordinated initiatives for economic recovery is becoming stronger.

According to data from the Bangladesh Bureau of Statistics (BBS), overall inflation stood at 8.49 percent in December, increasing for the second consecutive month.

According to businessmen, sales of goods have decreased by 20 to 30 percent without increasing the purchasing power of the people. Credit growth in the private sector has fallen to 6.23 percent. High interest rates and strict credit policies have increased investment costs, which are having the greatest impact on small, medium and new entrepreneurs.

Khandaker Ruhul Amin, former director of the apex body of traders, FBCCI, said that traders involved in foreign trade are under the most pressure. At the same time, traders involved in local trade are not in a good condition as people’s purchasing power in the domestic market has decreased.

According to him, it will be difficult to restore peace for the business community if a political government is not formed through elections.

Industrialists claim that the law and order situation, instability in the banking sector, and the energy crisis are the main obstacles to business at present. The cost of running a business has increased by about 35 percent in the past year.

According to analysts, the economy is likely to recover once political uncertainty eases after the national elections.

In this regard, BKMEA President Mohammad Hatem said, “Currently, there are no effective initiatives to listen to the businessmen. Therefore, they are waiting for discussions with the government formed after the elections. He expressed hope that whichever party comes to power, they will sit with them and take necessary steps.”

According to economist Shahadat Hossain Siddiqui, the first and biggest challenge facing the next political government will be to eliminate the prevailing distrust in the financial sector.

Businessmen and economists believe that it will not be easy for the elected government to restore investment and business confidence. Therefore, they have emphasized the need to adopt sector-based long-term plans for sustainable economic growth.