Bangladesh's economy had shown some signs of recovery from pandemic-induced challenges during the second half of FY21, but much depends on mass vaccination and the strength of the global economy, according to the Metropolitan Chamber of Commerce and Industry, Dhaka (MCCI).
The stimulus packages comforted business groups, from large firms to petty micro-enterprises, which eventually helped the economy to boost again.
However, non-availability of mass vaccination may appear to be one of the critical factors for slower economic recovery, the country's oldest trade body said in its review on Bangladesh's economy in FY21 unveiled on Monday.
The MCCI also suggested removing all barriers to investments to cushion economic losses caused by Covid-19.
The low level of private investment, local and foreign, is largely owing to underdeveloped infrastructure, it said, adding other impediments are a lack of adequate energy and weak transmission infrastructure, a lack of consistency in policy and regulatory frameworks, scarcity of industrial land, corruption, and non-transparent and uneven application of rules and regulations.
The government needs to address these impediments to attract more foreign direct investment to the country to ensure the country's economic recovery from the ongoing Covid-19 pandemic.
Historically, Bangladesh has remained a low-saving and low-investment country. The rate of growth of both savings and investment has also been very slow. As a proportion of GDP, gross investment was recorded at 29.92% in FY21 from 30.47% in FY20, read the MCCI review.
The share of private investment in GDP was recorded at 21.25% in FY21 from 22.06% in FY20, whereas the share of public investment rose to 8.67 per cent of GDP in FY21 from 8.41 per cent in FY20.
Apart from separate reviews on macroeconomic indices, mainly on agriculture, industry, services, capital Market, investment and savings, monetary and credit development, export, import, remittance, balance of payment, foreign aid, FDI, foreign exchange reserve, price Situation, public finance, public expenditure, employment, the MCCI also came up with some recommendations.