They think the existing customs and VAT laws, and foreign exchange regulation act should be changed
Business leaders believe economic recovery from the Covid-19 fallouts is possible by ensuring that existing businesses remain in operation, and by keeping production active by bringing foreign direct investment (FDI).
They think this needs financial support while the existing customs and VAT laws, and the foreign exchange regulation act should be changed.
They came up with the view at the third Resurgent Dialogue titled "Private Investment in Uncertain Times: Covid Impact and Policy Implications for Bangladesh" on Sunday.
It was organised by Resurgent Bangladesh in partnership with Metropolitan Chamber of Commerce and Industry (MCCI), Dhaka Chamber of Commerce and Industry (DCCI), Chittagong Stock Exchange, the Board of Business Initiative Leading Development (BUILD), and Policy Exchange.
Asif Ibrahim, chairman of Chittagong Stock Exchange and a member of Resurgent Bangladesh steering committee, gave the welcome speech.
Policy Exchange Chairman Dr Masrur Reaz presented the keynote paper.
He said FDI would fall by 40 percent this year across the world because of the pandemic.
Earnings of the top 5,000 multinational entrepreneurs will also drop by 40 percent, said Masrur, adding that this can fall to 45 percent in the developing Asian countries.
He said Bangladesh is facing a fall in external and internal demands because of the lockdown that lasted two to four months.
This will cause 1.6 crore people to lose jobs, and export earnings would decrease by 17 percent at the end of the year, he said.
"Remittance will fall by 25 percent. Sixty-eight percent of SMEs face the threat of closure," said Masrur.
As for recovery, he said the government now has to create new sectors and take initiatives to attract FDI, especially from Europe.
MCCI President Barrister Nihad Kabir said for economic recovery, there should be steps so that local industries can sustain, in addition to FDI.
MCCI former president and Apex Bangladesh Managing Director Syed Nasim Manzur said the customs act is very old and has become incomprehensible because of the imposition of statutory regulatory orders (SRO).
He said the foreign exchange regulation act, in addition to the customs law, should be changed.
There should be plans now to make manufacturing companies sustain before anything else, he added.
Grameenphone CEO Yaser Azman said saving the existing businesses should be planned first.
He said the authorities should loosen their grip on disputes they have with both local and foreign firms.
"Everyone should be given an equal opportunity to do business. Everyone will pay taxes as per the law," he added.
Kedar Lele, CEO and managing director of Unilever Bangladesh said non-tax hurdles are the main problems for foreign investors who want to invest in Bangladesh.
"We are not talking about reducing the tax rate. We want that tax complications to be reduced," he added.
MCCI Director TI Nurul Kabir proposed bifurcating the National Board of Revenue (NBR).
He said a division will enact laws and the other will implement those.
"Because the same division enacts laws and then implements those at the field level, they can make changes according to their wish. As a result, business owners do not get justice," he added.
DCCI President Shams Mahmud said textile companies are experiencing hassles in their attempts to take loan from the Covid-19 stimulus packages.
Bangladesh Export Processing Zones Authority (Bepza) Executive Chairman Major General SM Salahuddin Islam said they had taken several initiatives, including allocation of economic zones, to attract FDI.
He said the process of giving foreign investors tax holiday and providing utility services is being eased.
"Three big foreign firms invested $15 million during the pandemic. We will get FDI from 38 countries," he added.
Bangladesh Investment Development Authority (BIDA) Executive Chairman Md Sirazul Islam said Bangladesh is now an attractive place for investment for all.
"Our talent and manpower are our biggest strength. To utilise these, we have talked to big firms in Japan and Korea. We are working to improve our performance in the indicators on the ease of doing business index," he added.
Former NBR chairman Mosharraf Hossain Bhuiyan called for stepping up regular and structured dialogues between regulators, such as the NBR and the business community.
BUILD Chairman Abul Kasem Khan said Bangladesh needs to better exploit the huge markets of China and India.
In his summary of the discussion, DCCI President Shams Mahmud shared difficult experiences of Italian investors in Bangladesh, and how the regulatory service delivery agencies of the government create hurdles for investors.
Parliamentarian Nahim Razzak, a member of the Parliamentary Standing Committee on Foreign Affairs, and Waseqa Ayesha Khan MP, finance and planning secretary of the Awami League central committee, shared multi-pronged government strategies to deal with the economic impact of coronavirus.
They agreed with the need for quick reforms to improve the doing business index ranking, and Bangladesh's branding.
President of Spain Bangladesh Chamber of Commerce and Industry and a member of European Union Business Council Nuria Lopez, Foreign Investors' Chamber of Commerce and Industry Executive Director Nurul Kabir, and Secretary General of Economic Reporters Forum Rashidul Islam also spoke at the programme among others.