Economic Reporter :
Industries Minister Nurul Majid Mahmud Humayun on Tuesday urged to prepare a comprehensive database for the Cottage, Micro, Small and Medium Enterprise (CMSME) sector of Bangladesh to help smooth distributing of credit to all affected businesses under stimulus package.
The minister made the call while speaking at a virtual dialogue on “COVID-19 Economic Crisis and SMEs of Bangladesh” organized by Business Initiative Leading Development (BUILD) on Tuesday.
Speaking at the discussion, Nurul Majid Mahmud Humayun also said that under his ministry in collaboration with SME Foundation a CMSME database can be prepared across the country.
Terming SME is the lifeline of our economy, the minister emphasized on coordinated efforts to frame a long-term planning, new employment generation, SME product diversification, strong monitoring on loan disbursement, health safety and tackling job loss amid Covid-19 pandemic.
BUILD Chairperson Abul Kasem Khan apprehended that unemployment may raise and economic dynamism might be stymied unless SME’s current situation improves as the SMEs are the worst victims due to COVID-19 pandemic.
He urged that the government should come up with insights and guidance for small businesses searching for ways to cope with the operational stress generated by COVID-19.
Highlighting concessional loans, tax exemption and digital transformation, the Kasem said that refinancing can be a useful tool to improve access to finance for the SMEs.
Ferdaus Ara Begum, CEO of BUILD said the CMSMEs in the country are facing severe crises such as shutting down of business units, problems in access to finance, cancellation of export orders, the massive downturn in sales and unemployment.
Dr Monzur Hossain, Senior Research Fellow of BIDS said that it should be recognized that while MSMEs are the main drivers of the economy of Bangladesh and they have received the hardest punch due to COVID-19 pandemic.
The stimulus package announced by the government for CMSMEs is undoubtedly a praiseworthy initiative, but the implementation process of this package needs to be more effective to reach the beneficiaries who may find it difficult to avail bank credit, he added.
Safiqul Islam, Managing Director of SME Foundation, said the expansion of business as a whole and SMEs in particular has stopped due to the disruption of production owing to the prolonged lockdown.
This crisis can cause workforce layoff in SME sector which can create a huge threat for the economy of Bangladesh and the proper allocation of the stimulus package can be ensured by utilizing the Credit Wholesaling Program (CWS) of SMEF, he added.
Nihad Kabir, President of MCCI said that small and medium sectors are often lumped under the same category without taking into account the wide gulf of difference in size between the two sectors.
“Small borrowers are unable to follow the regulations followed by the medium or large borrowers. Only Tk 30 crore was disbursed in the stimulus package of working capital for SMEs,” he said.
Shams Mahmud, President of DCCI said taxation and VAT related facilities can be given to all RMG and non-RMG sectors in a level playing field to improve the competitiveness and product quality.
Rashedul Karim Munna, MD of Creation Ltd mentioned that it will be a serious challenge for the government to include the informal SME sector into the formal and traditional financial channel.
