Good governance will be the key to accelerating growth of Bangladesh towards LDCs graduation, although it has maintained a reasonable but steady growth without doing much in addressing the issue, economists made the observation on Sunday.
RMG sector, remittance, robust growth in agriculture and microfinance have been the growth drivers for Bangladesh economy since 90s, where good government played little role, but the honeymoon period may continue roughly for the next 10 years, they warned.
The observation came at a session of a two-day conference of Bangladesh Institute of Development Studies (BIDS) styled ‘Bangladesh Journey: Accelerating Transformation’ that kicked off at a city hotel on Sunday.
“Focus should be given on growth acceleration; not on growth to fulfil the country’s mid-income aspirations, where good governance has a lead role to play,” said Dr Hossain Zillur Rahman, a former adviser to a caretaker government. He chaired the session called ‘Can Bangladesh continue to grow without good governance?.’
“There is no scope of being complacent about next 11 economy tags. Now time has come to think about how to move up the ladder,” he added.
Right from the very beginning of Bangladesh, growth volatility has never been an issue as it has consistently posted a six plus growth for many years, he said. However, he questioned: “What are the outcomes of that growth? Can it produce job for the educated unemployed people? ” He said the 6.5 percent growth rate could not push up private investment from 21 percent, adding that “sub-standard universal education” is going to be a barrier to mid-income aspirations of the country. “Good governance is important not only for growth, but also for establishing basic human rights.
Economic development without good governance is meaningless,” commented Dr Akbar Ali Khan, also an adviser to former caretaker government.
He repented that good governance indicators are going down in the country, while the economy is improving.
“When a country remains at the bottom in terms of development, many factors excluding good governance can contribute to that development. But when you talk about mid-income country, the governance issue is important,” he argued. He, however, thinks that it won’t be a problem for Bangladesh to continue the situation for the next five or 10 years, riding on macro economic stability. Moreover, getting results from any good governance ensuring initiatives will take 10 to 15 years, he said.
He suggested lowering government control or regulations over economic activities, otherwise no improvement will be visible in terms of ensuring good governance. He also suggested reviewing bonded warehouse and tax holiday facilities to ensure good governance.