REPORTS published in a local English daily show that Bangladesh Bank released a press release titled ‘The Economy in 2014 and Looking Forward’ which clarified that there was investment stagnancy in the country in the outgoing year of 2014 due to political turbulence, general strikes and blockades. The report also warned that an upward pressure on inflation will remain in the new year of 2015 due to the new pay scale and other global and local issues. The nation’s economy took a heavy hit as political turbulence, hartal, and blockades spanned through 2013, causing the investment stagnancy in the whole year of 2014, according to reports. Moreover, investment is yet and the central bank said that the economic developments of 2014 conveyed mixed signals. Regardless, opportunities for improving infrastructure and revenue mobilisation still remain unused and the reports also showed that excess liquidity of the Dollar and Taka in the local market still exists suggesting a slow revival of trade and commerce. Latest information show that imports and exports reflect a similar trend that helped the foreign currency reserves registered a new record.
They also explained that an upward pressure on inflation will remain due to the new pay scale, the possibility of oil price hikes because of political tension in the Middle East, and finally, the demand pull impact on the price level because of output growth. Reports though indicated that there still remain some aspects of economic discomfort that includes defaulted loans, excess liquidity, and some irregularities at the branch level of scheduled banks in 2014.
Even though the BB plans to keep these issues in mind and design the upcoming monetary policy accordingly so the targeted 6.5 percent inflation becomes achievable, potential political issues and economic damage cannot be predicted so early on and may change the outcome of the current plan. Corrective measures of the BB have been in place for sometime now which have yielded a positive effect, but more monitoring and regulation is required to keep everything in check. We hope that the coming year brings better economic stability, but we must also hope realistically that it is not an easy target to achieve, considering our volatile political situation. Our economy should not remain a hostage due to the nature of our political system which makes parties hungry for power.
