The global economic crisis caused by the Covid-19 has hit Bangladesh’s economy hard and jeopardised the country’s achievement in poverty reduction. As a result, the poor and vulnerable people are going down the extreme poverty line. So the inequality in society will further increase.
According to a study report, the resumption of economic activities reduced the number of crisis caused “new poor” by 1.1 percentage points to 21.7 per cent in June from 22.8 per cent in April. It was carried out among 7,638 households in urban slums, rural areas and hill districts between June 20 and July 2.
The study, carried out jointly by the Power and Participation Research Centre (PPRC) and the BRAC Institute for Governance and Development (BIGD), found that 15 per cent respondents migrated from Dhaka to other less-costly cities and rural districts during the period while only 1.26 per cent moved to Dhaka. On the other hand, 8.35 per cent moved from Chattogram to other districts while 0.62 per cent moved to Chattogram from other districts.
Media report in a national daily on Monday said that the organisations’ latest survey was carried out to analyse and understand the recovery journey of the poor and vulnerable populations since the government lifted the shutdown at the end of May.
Against this backdrops, the survey recommended for a new stimulus package for low capital, but productive smaller firms through alternative delivery platforms such as microfinance institutions for the soonest rebound of small businesses.
In fact, the economic recovery will depend on how the government supports the small enterprises since they are most dynamic in the country’s economy. These small enterprises have been shut during the pandemic and they have lost their working capital. Though the large business houses will thrive again as stimulus package is there; replenishing working capital for the small enterprises is the main challenge.
In a globalised economy thwarted by the pandemic, it is too early to be optimistic about the country’s economic rebound. The export earnings will depend on how the pandemic unfolds in the Western countries and remittance inflows will depend on the conditions in the Middle Eastern countries over the next few months. We have to keep an eye on both the sectors that would ultimately serve the best interest of our economy. The government itself is struggling to be effective.
