Current/Recent Business News

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Current Business news from online papers of Bangladesh.

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Current/Recent Business News

  1. 1. Presentation on Recent Business News 1
  2. 2. NAME: MD. MOAZZEM HOSSAIN ID. 110106034 COURSE TITLE: ADVANCED ACCOUNTING 2 25/03/2014
  3. 3. 3 Serial No. Topic Slide No. 1) GDP growth to finally stand at 5.6pc: Mirza Aziz 03-07 2) DHL, One Bank sign express delivery deal 08 3) DELL to donate 1 lakh laptops 09 4) $774m IFC credit to boost private sector 10-11 5) Dhaka Chamber for raising tax ceiling 12-13 6) Dhaka Chamber for raising tax ceiling 14 Table of Contents
  4. 4. 4 The country’s GDP growth will be around 5.6 per cent in the current fiscal year, the lowest in over a decade, says a renowned economist though Finance Minister AMA Muhith still looks optimistic about achieving ambitious 7.2 per cent target, reports UNB. “My observation is that the growth will definitely remain below 6 per cent. As per my estimate, it’ll be 5.6 per cent,” former finance adviser to a caretaker government Dr AB Mirza Azizul Islam told the new agency explaining why the growth will be lower this time. However, the Bangladesh Bank (BB) forecasts that the GDP (gross domestic product) will stand at a range between 5.8 per cent and 6.1 per cent, which is also far below the Finance Ministry’s target. “Our forecast, given in the last monetary policy statement, still remains unchanged. BBS (Bangla-desh Bureau of Statistics) will ultimately tell us we can only forecast. But we think the final figure will remain within the range between 5.8 and 6.1 per cent,” BB Chief Economist Dr Hassan Zaman told the news agency. Asked whether they disagree with the Finance Ministry’s observation, the central bank chief economist said it is normal to have often different forecasts in a ‘mature economy’. “At the end of the day, the statistical agency will come up with the figure. Let’s see what the BBS says.” GDP growth to finally stand at 5.6pc: Mirza Aziz
  5. 5. 5 GDP growth to finally stand at 5.6pc: Mirza Aziz Bangladesh
  6. 6. 6 On March 12, Finance Minister AMA Muhith said in Parliament that the government has decided to keep the country’s GDP growth target of 7.2 per cent for the current fiscal year unchanged. Muhith, while presenting the first quarterly report on the state of Bangladesh economy in the House, also said it would not be tough to attain the targeted GDP growth of 7.2 per cent if the industrial production picks up and Aman as well as Boro harvests are satisfactory. Data show that GDP growth acceleration, so critical to realising Bangladesh’s ambition of becoming a middle-income country and graduating from the LDC bracket, has been lost in recent years. Since FY 2011, the GDP growth has been on a downtrend -- 6.71 per cent in FY 2011, 6.23 per cent in FY 2012 and 6.03 per cent in FY 2013. Asked how the Finance Minister expects higher growth, Mirza Aziz said the Finance Minister is not giving any explanation on what basis the target will be achieved. Explaining his calculation, the economist said the remittance growth, by the end of the current FY, will remain negative if it is compared with the last FY’s growth while the export has started decelerating though it performed well in the previous months. GDP growth to finally stand at 5.6pc: Mirza Aziz
  7. 7. 7 On the growth of domestic consumption which accounts around 75 per cent of GDP, Mirza Aziz said the private consumption has declined for various reasons resulting in lower earnings from the VAT (value added tax) and the consumption growth will remain much lower than that of the previous FY. Similarly, private investment growth will definitely remain lower than that of the previous FY, he said adding that the government’s investment is also declining. “So, if the scenario is that how and where the GDP growth will come from? So, over 6 per cent growth is impossible,” said the economist reminding that the country witnessed 6.03 per cent growth in the fiscal year 2012-2013. BB chief economist Dr Zaman, however, said the GDP growth in the current fiscal year could have been higher (from BB’s forecast) if the country could avert the losses the economy suffered in the first half of the current FY due to various factors, including the prolonged political chaos. Asked whether they disagree with the Finance Ministry’s GDP target setting, the central bank economist said a target can be set but the question is how much ‘realistic’ the target is. “You can easily draw a conclusion on your own if you look at the gaps between the targets set by the Finance Ministry in last five years and the ultimate results,” Dr Zaman said. He laid emphasis on having coordination meetings involving the Finance Ministry, Planning Ministry, other government agencies and private think-tanks to share forecasts and views on economic trends. GDP growth to finally stand at 5.6pc: Mirza Aziz
  8. 8. 8 Asked whether it would be judicious to set similar growth target for coming fiscal year when target for the current fiscal year is likely to remain unmet, Mirza Aziz said, “We can set higher target but the question is whether proper grounds are created for a massive jump.” Aziz also said he does not see any sign and steps that can boost investment, consumption and remittance inflow which are a must for a massive jump in terms of GDP growth. The economist expressed doubt whether the prevailing political stability will sustain as situation may change after the upazila polls being held in phases. Entrepreneurs formulate investment plans considering investment environment in the long- term. The investment is unlikely to get momentum in the coming months as political uncertainly appears to return for various reasons, Mirza Aziz said. Talking to the news agency, economist Dr Mustafa K Mujeri said it would be an impressive one if around 6 per cent GDP growth is achieved at the end of the fiscal year. “However, it depends on how we can recoup losses in the remaining months.” The economist, also the Director General of the Bangladesh Institute of Development Studies (BIDS), said he does not see any significant sign or steps that can expedite growth at this moment. Reviewing the macroeconomic performance in the first half of fiscal 2013-14, the Centre for Policy Dialogue (CPD), a civil society think tank, says the GDP growth might slip below 6 per cent this fiscal year. The CPD expects the economy to grow between 5.6 per cent and 5.8 per cent if there is no major supply disruption and political turmoil in the remaining months of the current fiscal. All the international bodies - the World Bank (WB), International Monetary Fund (IMF) and Asian Development Bank (ADB) -- are putting the GDP growth figure below 6 per cent against the government target of 7.2 per cent. GDP growth to finally stand at 5.6pc: Mirza Aziz
  9. 9. 9 DHL, One Bank sign express delivery deal DHL Express, the world's leading express company, has recently signed an agreement with One Bank Limited, to provide international express delivery to the bank and its customers, says a press release. The agreement was signed by Desmond Quiah, country manager of DHL Express Bangladesh, and M Fakhrul Alam, managing director of One Bank Limited at the Country office of DHL Express Bangladesh recently. Under this agreement, the One Bank Limited will use DHL Express services for time- sensitive international documents. DHL’s service includes automated shipment preparation, pre scheduled pick-ups, a modern shipment tracking system and shipment processing at DHL’s state-of-the-art operational facilities in the country, with connectivity to more than 220 countries and territories worldwide.
  10. 10. 10 DELL to donate 1 lakh laptops US computer Company DELL will distribute one lakh free laptops among the Bangladeshi women as part of its women empowerment programme. Charged affaires of the US Embassy in Dhaka, Jon Danilowicz informed this to the planning minister AMH Mustafa Kamal during a meeting at his office at Sher-e- Banglanagar in the city yesterday. The laptops will be provided under the project "One family one woman" under the Post, Telecom, and Information Communication Technology ministry. DELL will also provide training to the women to build up skill on the ICT.
  11. 11. 11 $774m IFC credit to boost private sector The International Finance Corporation (IFC), a member of the World Bank Group, has provided USD $774 million commercial loan for 12 projects for the development of private sector in Bangladesh in FY 12-13, according to Economic Relations Division (ERD) sources. The IFC is also providing advisory support, including facilitating improvements in doing business and promoting competitiveness of small and medium enterprises to safeguard jobs. The ERD sources said the IFC is keen on providing huge amount of commercial credit, particularly for the power sector. On the sidelines of a meeting with Jin-Young-Cai, executive vice-president of the IFC, on October 10, 2010, at the Commonwealth Finance Ministers’ meeting (CFMM) and annual meetings of the World Bank (WB) Group and International Monetary Fund (IMF) in Washington, finance minister AMA Muhith had pointed out that the IFC had been making major investments in telecommunications by offering trade financing in Bangladesh. Muhith also urged the IFC to go ahead with financing projects under the public- private partnership.
  12. 12. 12 The IFC has a large advisory programme in Bangladesh, with supports from the UK, the European Union, the Norwegian Agency for Development Cooperation, Dutch and other donor financiers. It works in areas that are crucial for the country's economy, such as agriculture, infrastructure, financial markets and energy efficiency. The IFC supported the financial sector development in Bangladesh with USD $401 million in committed investments in FY12-13. The IFC assists the Bangladesh government in simplifying business regulations and bringing down the cost of doing business, by supporting the growth of the private sector. In keeping with the government’s agenda for a “Digital Bangladesh”, the IFC promotes efficiency and transparency in public sector agencies through e- governance, establishment of an online tax payment portal, automation of the registrar of joint stock companies, the sources added. $774m IFC credit to boost private sector
  13. 13. 13 Dhaka Chamber of Commerce and Industry (DCCI) has proposed the National Board of Revenue to increase tax free income limit for individual tax payers to Tk 3 lakh from the existing Tk 2 lakh 20 thousand in the forthcoming national budget (2014-15). The chamber also recommended raising the tax exemption limit to Tk 3.5 lakh from Tk 2.25 lakh for female and elderly citizens and also to Tk 4 lakh from Tk 3 lakh for disabled. It was recommended while DCCI president Mohammad Shahjahan Khan placed a 59-point budget recommendation to NBR chairman Md Ghulam Hussain at NBR in the capital yesterday in considering with creating a business and industry-friendly budget for the forthcoming fiscal. Khan called upon the government to prepare the upcoming budget considering the losses incurred because of the recent political instability and violence. Dhaka Chamber for raising tax ceiling
  14. 14. 14 NBR chairman Md. Ghulam Hussain assured the DCCI President of considering the placed recommendations by DCCI. The chief tax administrator also discussed the pros and cons of the present business environment of the country. In the budget proposals, the Dhaka Chamber also urged the NBR for reducing corporate tax on listed companies from the prevailing 27.5 per cent to 20 per cent. DCCI also recommended increasing the limit of annual turnover tax from Tk 8 million to Tk 10 million and fix up the turn over tax rate at 2 per cent from the current 3 per cent. Moreover, the chamber also called upon the NBR to continue special incentives to the country’s small and medium enterprises. DCCI also pledged to increase VAT free investment capital in plant and machineries equipment from the existing Tk 8 million to Tk 10 million. Demanding tax exemption on the income of chamber or trade bodies for being non-profit organizations, the chamber called upon the NBR to provide 15 per cent cash incentives to the export-oriented plastic industries. Dhaka Chamber for raising tax ceiling
  15. 15. 15 I made this presentation with help of internet and the official website of “The Independent” a popular English newspaper of Bangladesh. . http://www.theindependentbd.com . http://www.eindependentbd.com Conclusion
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