TK 5000Cr Stimulus Package Exporters express reservation to criteria

Exporters on Wednesday expressed reservation to criteria set against the release of stimulus package of Tk 5,000 crore announced by the government for export-oriented businesses likely to be affected by coronavirus outbreak, said officials. 

The reservation was expressed at an inter-ministerial meeting at the secretariat on reviewing the criteria fixed by the finance division for releasing the fund by the Bangladesh Bank. 

They opposed imposition of two per cent service charge with the loan and mandatory submission of workers’ identification number to avail the fund, said the officials attending the meeting.

Commerce minister Tipu Munshi who presided over the meeting told reporters that differences in opinions surfaced at the meeting.

Not detailing the differences, he said that they were trying to overcome those.

Bangladesh Garment Manufacturers and Exporters Association president Rubana Haque, Bangladesh Knitwear Manufacturers and Exporters Association president Salim Osman and Bangladesh Exporters Association president Abdus Salam Murshedy led the delegation of the exporters.

The meeting was attended, among others, by Bangladesh army chief General Aziz Ahmed, Bangladesh Bank governor Fazle Kabir and secretaries of the cabinet division, finance division, commerce ministry and principle secretary to the prime minister.

Tipu Munshi hoped that they would come up with guidelines to use the fund by the next two and three days.

The meeting was held a week after the financial package was announced by prime minister Sheikh Hasina on March 25 just before the 10-day public holiday.

The first criterion of the stimulus package prepared by the finance division was that the fund will be taken only for the payment of workers’ wage, said the BB official.

Factories qualified for the fund must have records of exporting 80 per cent of their productions was another criterion, they said.

Other criterion is the fund will be available in the form of loan with two per cent service charge to be taken by the commercial bank to distribute the wage to the workers’ accounts be those in commercial banks or cell-phone-based services.

The national ID of the workers should be submitted so that foreign workers in the export oriented sector do not get benefit from the fund.

The factory avail the fund will pay back it in two years in 18 equal instalments with six months grace period.

That BB will enjoy the privilege to add new criteria, if necessary, to operate the fund is the last criterion.

On Tuesday, BB deputy governor SM Moniruzzaman said that many issues need to be settled about the financial assistance, including the areas of coverage after consulting with stakeholders.

He also said that it would take more time to announce guidelines on the basis of the finance division criteria.

Bangladesh last announced a stimulus package to cushion the country’s economy in the face of the blow from the global meltdown in April 2009.

A Tk 3,424 crore aid package was announced then for the power, agriculture and export sectors in order to face the fallout of the global recession within months after the Awami League came to power.

The package, however, did not provide any cash incentive to the largest export-earning readymade garments sector and the ceramics exporters as they did not experience negative growth.

But this year, according to RMG exporters, a downturn in the country’s export earnings has started even before the impact of the coronavirus outbreak that has killed five people and infected 51 so far in the country.

The country’s export earnings fell by 4.79 per cent to $26.24 billion in the first eight months of the current fiscal year mainly due to the trade war between the US and China against $27.56 billion earned in the corresponding period of the last fiscal year.

The Asian Development Bank has projected that the Bangladesh economy might lose 1.10 per cent of its GDP, or $3.02 billion, in addition to 8.95 lakh job losses due to the coronavirus pandemic.

News Courtesy: www.newagebd.net