The country is on the right track, Finance Minister AMA Muhith told Dhaka Tribune on Sunday, on the eve of the Awami League-led 11-party government’s second anniversary.
“People are happy with the Awami League government’s development work,” he said. “But achieving good governance will be the government’s big test in cementing middle income status.”
Few people have witnessed Bangladesh’s transformation from the inside the way Muhith has. After serving in Pakistan’s civil service, he went on to hold senior bureaucratic positions in Bangabandhu’s government, and as finance minister under Ershad and during the Awami League’s previous and current terms in office.
Muhith said the lack of a demand for midterm elections was proof that the public was satisfied with the government’s performance. “Our leader Prime Minister Sheikh Hasina earlier said midterm elections within two years of the 2014 polls might be considered. But such a demand no longer exists.
“I am certain there will be no new elections in the next two years and I am sure I will announce Bangladesh’s next two budgets.”
Despite his optimism, the finance minister remains focused on the work ahead.
“We must consolidate our middle income status. Becoming a lower-middle income country, by World Bank standards, was the high point of last year, but I still have to lift nearly 40 million people out of poverty,” he said. “Some 22% of the country’s population remains beneath the poverty line. Reducing this proportion to 10% is a major challenge.”
He said a cabinet colleague’s concerns might hold the key to poverty alleviation.
“Agriculture Minister Motia Chowhury is vocal about the agro-processing industry developing new agricultural products. Though long neglected, it is now time to boost the country’s agriculture sector.”
But he was unhappy with indiscipline and poor governance in the country’s public sector banks. “Banks have been put under review this year because of two big incidents of embezzlement at Sonali Bank and Basic Bank.
“Many banking sector issues must be discussed, including the political appointment of directors of public banks. The political appointment of directors is wrong because they simply act as commission agents for potential borrowers.”
The veteran finance minster expressed pleasure that Bangladesh had outperformed India, the world’s largest democracy, on a number of social indicators. “This is the result of our deliberate policy of pursuing people-oriented economic advancement and extending the country’s social safety net.”
Improving economic management is of little use unless the focus is on development, he stressed. “We will achieve developed country status only if we can reduce the population living below the poverty line.
“Our major task is to create jobs for the poor. A large number of jobs cannot be created unless we develop the country’s infrastructure.”
Muhith said as mechanisation increases in agriculture, fewer people will be employed in the sector. “This means that unemployment could be a major problem for Bangladesh. We have prioritised this in the next two five-year plans.”
Muhith said widely varying estimates by experts and foreign development partners were a source of laughter for him. “Although the GDP growth rate currently stands at 6.8%, we project it to hit 7% by the end of the fiscal year.”
He hailed Bangladeshi businessmen as experts in adding value to finished products, even if their components come from abroad.
Private sector investment had shown promising signs during the last six months, he said.
Muhith refuted the suggestion that weak local investment meant that foreign investors would not be interested in Bangladesh. “Foreign investors are always looking for partners.
Local investors were not sure about the political situation. But the period of hartals is over and the BNP’s movement has fizzled out. Confidence among local businesses is growing. They want to invest in their native soil.”