Kazi Zahidul Hasan :
Loss making state-owned enterprises (SoEs) has posed a serious threat to the government fiscal balances owing to a big amount of outstanding loans to public banks.
The total outstanding loans (funded and non-funded) of 16 SoEs to the public banks reached Tk 30,375.52 crore as of February this year, according to Bangladesh Bank (BB).
The loans have been provided to SoEs as the government continued policy of ‘spoon feeding’ loss making public enterprises.
“SoEs are in deep trouble being heavily indebting to public banks. Sheer management incompetence and corruption have made them financially crippled forcing government to provide huge bailout funds every year,” economist Dr Zahid Hussain told The New Nation yesterday.
He said funds are being provided to them from the cash strapped public banks intensifying their woes further.
“Corruption in state-owned enterprises has been unfolding for years. But the government continues to provide funds to them under political consideration. This is an example of bad economic governance and it is ultimately posing a serious threat to the fiscal balances,” added Dr Zahid Hussain.
According to Bangladesh Bank, the public entities owed Tk 18,697.08 crore to Sonali Bank, Tk 5,759.62 crore to Rupali Bank, Tk 4,208.65 crore to Janata Bank, Tk 1,223.73 crore to Agrani Bank and Tk 487.44 crore to BASIC Bank.
In terms of SoEs outstanding loans, the Bangladesh Power Development Board (BPDB) tops the list with Tk 11,128.69 crore followed by Bangladesh Sugar and Food Industries Corporation (BSFIC) with Tk 5,624.46 crore, Bangladesh Petroleum Corporation (BPC) with Tk 3,769.52 crore, Bangladesh Chemical Industries Corporation (BCIC) with Tk 2,856 crore, Bangladesh Agriculture Development Corporation with Tk 2,511.49 crore, Bangladesh Rural Electrification Board (REB) with Tk 1,029.58 crore, Bangladesh Jute Mills Corporation (BJMC) with Tk 819.21 crore, Biman with Tk 692.75 crore, Bangladesh Oil and Gas Mining Company (BOGMC) with Tk 656.34 crore, Bangladesh Water Development Board (BWDB) with Tk 620.93 crore, Chittagong Port Authority (CPA) with Tk 430.93 crore, Bangladesh Steel and Engineering Corporation (BSEC) with Tk 136.53 crore, Bangladesh Textile Mills Corporation (BTMC) with Tk 20.67 crore, Dhaka WASA with Tk 15.32 crore, Bangladesh Tea Board (BTB) with Tk 10.52 crore and Bangladesh Road Transport Corporation (BRTC) with Tk 0.57 crore.
“The government cannot afford huge amount of bank liabilities of the public entities in the long run. The economy will face a serious setback if the government does not stop providing funds to SoEs as ‘spoon feeding’,” former adviser of the caretaker government Dr AB Mirza Azizul Islam told The New Nation.
He said state-owned enterprises are making losses due to inefficiency of their managements. They continue to put pressure on the national coffer taking continuous bailouts and government guarantees. By this way they pose a serious threat to government’s fiscal balances and policy priorities.
Dr AB Mirza Azuzul Islam, however, suggested the government to sell all the loss-making public firms to come out from their debt burden and to maintain fiscal balance.
