The unprecedented Covid-19 pandemic has caused disruptions to global trade, business, and education. Bangladesh is equally affected by this contagion.
The unprecedented Covid-19 pandemic has caused disruptions to global trade, business, and education. Bangladesh is equally affected by this contagion. The economic consequences of the Covid-19 outbreak are tough to handle as the entire of the global supply chain has been interrupted due to worldwide transportation shutdown. Till now, the Bangladesh readymade garments (RMG) industry has received work order cancellations of nearly $3 billion. Around 2 million workers in the industries will be affected by this. Around 4 million people are directly engaged with the RMG sector e.g. backward linkage industries, accessories and packaging factories and transportation sector. The import and export-oriented companies are also at risk. The foreign remittance will come down and thus it will hit the foreign reserves of the country.
We all know the banking industry is in back gear due to mounting non-performing loans (NPLs). If the banking financed industry and its backward linkage industries fail, then the entire banking system will collapse. Today, fifty-nine commercial banks and general insurance companies are heavily relying on garments and related industries for their business. However, if the outbreak prolongs it will be difficult for the government to handle the situation and the result of this will be catastrophic. On a larger scale, we may have to face an economic slowdown in the short term while there might be a recession in the long term. For this, Government of Bangladesh has declared Tk72,750 crore stimulus package, including the previously declared Tk5,000 crore package, to address the economic impacts of the coronavirus outbreak. Fiscal actions include stimulus packages e.g. direct financial support for the affected sectors, widening social safety net coverage for poor people, food distribution at a lower price among the poor people, as well as increasing monetary supply.
Thus, a list of products has been introduced in line with Bangladesh Bank guidelines for providing the financial facilities to the demanded business sectors as per the following:
The above products are created for the time being under Circulation of BB and the same will be diminished as per procedure.