What the government should do to support economic growth
I last called on the Finance Minister AMA Muhith on March 7 of this year.
I was amazed to see this over 84-year-old “young man” maintaining appointments in his digital diary. I think this is exactly what he meant in 2008, in a television interview, while talking about his party’s election manifesto with reference to the party’s commitment towards building a Digital Bangladesh.
Although there has been too much of “talks” -- how far have we moved towards truly achieving this goal? We do not have any definitive answer. We also do not have definitive answers for achievements in the public-private partnership. Our entrepreneurs and business community cannot stop lamenting the irregular supply of gas and even to some extent electricity.
Added to these are questions about elevated expressway aimed to ease the insufferable traffic gridlock in Dhaka city, will Padma Bridge finish within the stipulated time, is the nation’s journey towards “middle-income country” status on schedule?
Will the common people get justice from the court of law or the law enforcing agencies? Will the kids get a quality education in the rural areas to come out of poverty? And so on. The list is quite long.
Yes, the government has passed almost 10 years without any major debacle; au contraire, it has had successes in agriculture, boosting relationships with the big players US, China, and India, a forward-looking education policy, Annual Development Program (ADP) implementation, and higher revenue collection.
I think the honourable prime minister is well aware of “where the shoe pinches.” I got this feeling while trying to read between the lines of her recent speeches in the country and even at the conferences abroad.
Economists and policy-planners all over the world are being challenged to draw a balance between the state and the market. The situation is much worse in countries where there is poverty, when the government is committed to private sector-led growth, and thereby wealth creation, though equitable distribution remains out of grasp.
In a transition economy like ours, each government comes up with long “will do’s” and “laundry lists,” however, the execution is often constrained by the capacity issues in civil bureaucracy, excessive politicization, regulatory bottlenecks, vision disconnects, failure in teamwork, and lack of proper planning and focused execution with the fear of being unpopular.
In the same way, the present government led us to dream the impossible with the country’s capacity level and intellectual solvency. That is manifested in the monetary policy which while trying to address the price spiral, possibly cannot do equal justice to the growth agenda, and that the regulatory body at frequent intervals remains mum about addressing the “fixing issues” in the capital market.
Added to these are the law and order situation, infrastructure deficiency, and more importantly, a lack of a forward-looking policy which could accelerate growth. In a labour surplus economy, a government has to focus on employment creation. It is also imperative for a savings surplus country like Bangladesh to create a congenial environment for investment, both domestic and foreign.
More importantly, we need to attack the archaic laws not supportive of growth, an education system that does not accommodate future needs, and a public health system which does not take care of the disabled, the physically and mentally challenged, and the malnourished population. The government often fails to maintain the firewall with the political party, more significantly the bad influence of the party members on the judiciary, civil administration, police or even state-owned entities.
Back in 2002, I read a book titled “Who Moved My Cheese?” by Dr Spencer Johnson. It was about people looking for cheese, which was used as a metaphor for what people want in life -- a satisfactory job, loving relationships, peace of mind; and where they look for it -- within the family, community, and organization.
The book revolved around four characters; each character signified the common personality traits found in human beings. One character’s trait was to be able to predict the change beforehand and change himself accordingly. The next one’s trait was to jump to conclusions, another’s was to fight the fear of change and deal with it, and the last one’s was to stay in the comfort zone and not deal with the change.
A few days back, as I was going through the book again, a thought struck me. The current government has about two more months to go. It came up with a big bang idea about “change.” It was, of course, very popular at the beginning with an “emerging vote bank” with lots of “cheese” around.
So far, it has managed well. However, it needs to be more focused on execution with togetherness, rather than constantly being reminded by its “body clock” to “wake up” in time and get back to its promises to change for the better and execute plans to take the country to the next trajectory of growth.
Mamun Rashid is a leading economic analyst