To understand Bangladesh's economic health with latest business trends, and to tackle future challenges effectively, the country’s oldest trade organization Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI) on Monday unveiled a “Purchasing Managers’ Index” (PMI) for Bangladesh.
PMI serves as a crucial leading economic indicator, offering valuable insights into a country's economic well-being.
It covers pivotal sectors like agriculture, construction, manufacturing, and services, providing precise and timely information about shifts in the business cycle and early trends.
The PMI data is obtained through monthly surveys of private sector enterprises and is then consolidated into a comprehensive index.
In collaboration with Policy Exchange Bangladesh (PEB) and with support from the UK Government’s Foreign, Commonwealth, and Development Office (FCDO), MCCI launched the Purchasing Managers’ Index (PMI) for Bangladesh at its Gulshan office on February 5.
Guest of Honor Matt Cannell, acting British high commissioner and development director to Bangladesh, said: “Our collaboration signifies a commitment to enhancing the understanding and analysis of our economic environment. The PMI, a tool widely used in global economies, is now being adapted to reflect and address the unique facets of some of the major industrial sectors in Bangladesh.”
“As Bangladesh undergoes LDC-graduation, it must prepare for the forthcoming challenges that will arise. By leveraging real-time data and insights from the PMI, Bangladesh will be able to tackle future challenges effectively.”
To inform PMI’s benefit, he further stated: “The PMI's applications are extensive, benefiting stakeholders like policymakers, financial institutions, corporates, investors, traders, and analysts. It provides timely insights into sector-specific economic activities, aiding policymakers, analysts, and investors in assessing current economic conditions. The PMI's sensitivity to economic shifts can offer early warnings of changes, often predating traditional indicators like GDP growth or employment figures. It encompasses diverse areas like new orders, production, employment, supplier deliveries, and inventories, offering a comprehensive view of economic health and potential sectoral challenges or opportunities. In light of Bangladesh’s impending graduation from the Least Developed Country (LDC) status, particularly after navigating the challenges of the pandemic and the Russia-Ukraine conflict, the PMI becomes even more pivotal in maintaining our developmental momentum.”
“By launching this initiative, we are stepping into a new realm of economic insight and analysis. The PMI is more than just a set of numbers; it's a comprehensive barometer that gauges the health and direction of our economy. This tool will enable us to make informed decisions, backed by real-time data and analysis, tailored specifically to our economic landscape,” Cannell further said.
“This is a transformative step for Bangladesh, and your presence here today is a testament to the collective will and effort to drive our economy forward on the path of informed economic progress,” he also hoped.
During the open forum, the topics that came up for discussion include correlation between different variables used in the PMI surveys, data reliability, confidentiality, and interpretation challenges.
Earlier in his welcome remarks, MCCI President Kamran T. Rahman said: “The PMI datasets had wide-ranging applications and could be used by various stakeholders. It has already been implemented in several nations.”
He believed the PMI could play a key role in sustaining Bangladesh’s development trajectory.
M Masrur Reaz, chairman, PEB, said that MCCI, PEB, and FCDO had come together to make robust data available regularly throughout the year. As the PMI provided actionable and quantifiable insights about the economy, it was very useful for the stakeholders.
He believed it would help make business and policy decisions.
Hasnat Alam, Senior Manager, Market and Policy Advisory, Policy Exchange Bangladesh, gave a brief presentation on the fundamentals and practicality of the PMI Program.
The event was moderated by Farooq Ahmed, Secretary-General and CEO, MCCI.