Six out of nine key economic indicators, including forex reserves, imports, domestic debts, export receipts, food stock and inflation, signalled significant challenges for the government, according to the Metropolitan Chamber of Commerce and Industry (MCCI.)
The trade body on Monday made the observation in its Review of Economic Situation in Bangladesh October-December 2023.
The economic indicators were prepared by the Bangladesh Bank.
There has been a slowdown in external demand, weak remittance inflow, a shortfall in revenue collection, slow public expenditure, a rise in inflation, a depreciation of the Taka, a decline in foreign exchange reserves and low investments in recent months, the MCCI observed.
The review said that the exchange rate of the taka had depreciated since the end of June 2022.
Between end-June of financial year 2022-23 and end-December of FY24, the value of the Taka depreciated by 1.49% in terms of the US dollar, it said.
One of the key indicators, gross foreign exchange reserves of the country, declined by a significant amount, to $21.87 billion at the end of December of FY24 compared with those of $24.75 billion at the end of June of FY23.
Another key indicator, import volume, also decreased significantly in the period.
According to the review, the total value of customs-based imports decreased by 19.90% to $33 billion against $41.20 billion in July-December of FY23.
Customs-based imports in December alone of FY24 also decreased by 13.40% to $5.23 billion compared with those of $6.04 billion in the same month of the previous financial year.
The MCCI review stated that the overall export earnings decreased by 8.55% against the strategic target ($30.11 billion), while merchandise export earnings increased by a marginal 0.83% to $27.54 billion compared with $27.31 billion in the corresponding six months of the previous fiscal.
The review said that the export receipts rose marginally, by 0.64%, while imports declined by 19.80%.
The gross inflows of foreign direct investment in July-December of FY24 decreased year-on-year by 27.53% to $1,827 million compared with that of $2,521 million in the same period of FY23.
The rate of inflation decreased to 9.41% in December 2023 from 9.49% in November 2023, according to the review.
The domestic credit grew by 11.89% at the end of December 2023.
The private sector credit growth was below the central bank’s target of 10.90% in December 2023, while the public sector credit also recorded a lower growth of 19.34% at the end of December 2023.