The International Chamber of Commerce-Bangladesh (ICCB) has put a thrust to generate adequate domestic resources to ensure sustainable growth in the backdrop of a global economic meltdown.

“We apprehend, international financial institutions and development partners including the World Bank, IMF and ADB may not be able to dole out credits and grants due to on-going economic crisis of the developed world,” the ICCB said in its editorial of the current ICCB News Bulletin released Sunday.

It said appropriate policy measures and timely implementation of those are needed to generate enough own resources for sustainable growth including increased foreign currency reserve.

The world economy is indicating another slowdown due to dragging European debt crisis. The European economy is expected to face the sharpest contraction in the history of EU. According to IMF, the current GDP projects a slower growth for the next six years (2011 – 2016) after a sharp fall in growth that EU is experiencing since 2007.

The German Chancellor and the French President have pushed for tighter budgetary control of national budget policies by the European Commission (EC). Their proposals included demand for EU countries to follow Germanys example and adopt a “debt brake, that is a legal cap on the cyclically adjusted government deficit of 0.5 per cent of GDP. Their proposals were largely accepted by the 17 EU countries in Brussels in last December. However, according to experts, the current problems of Ireland, Spain and Italy show that a debt crisis can emerge even if the budgetary fiscal flows are well under control. ECs capabilities to effectively monitor and play its role correctly to deliver the desired results are also to be seen.

Against this back drop of the West, emerging Asias recovery and growth in the past three years has been exceptional. IMF predicted, Asia as a whole will grow 8.2 per cent in 2010, which was more or less realized and 6.2 per cent in 2011. Developing Asias growth in 2011 was recorded at 9.5 per cent. Asia, with a solid global market and a large pool of foreign exchange reserves, has proven to be the shining light in a gloomy and uncertain world economy, say experts. However, Asias prospect is likely to be affected by the West; however, it is opined that rising Asia appears to be able to help save the world economy.

In line with Asian economies, Bangladeshs performance has so far been quite resilient to global economic meltdown; achieving 6.7 per cent GDP in FY11. Its macroeconomic performance was better than expected and regionally its performance had been one of the best.

According to just unveiled 6th Five Year Plan, the government plans to attain higher than 7% GDP, limit inflation within 7%, create 10 million new jobs as well as bring down poverty to 22% from present 31.5% during the plan execution period till 2015.

However, the recent economic indicators of Bangladesh are of concern as it may not be able to achieve 7% GDP. The Balance of Payments (BOP) situation has deteriorated markedly in recent months. The twin effects of surging import payments for fuel, goods and services as well as slowdown of remittance inflows in recent months have more than offset the large gain in export growth; contributing to a rapid deterioration of BOP situation and outlook. Besides, the tension in the money market has contributed to a significant depreciation of the exchange rate of Taka against the dollar and other major currencies; by about 16% during last few months.

The governments bank borrowing has already reached to Tk. 213.21 billion during the first five months, exceeding its target of Tk.189.57 billion for current FY12. On the other hand, banks have fallen into liquidity crisis for private sector investment. Commercial banks are borrowing money from other banks at a high interest rate to meet fund requirement.

According to ICCB editorial, despite some disturbing signs as mentioned above, Bangladesh still holds a much better prospect.

According to a study conducted by McKinsey & Company, on behalf of the German-Bangladesh Chamber of Commerce, Bangladesh s RMG exports will double by 2015 and nearly triple in next 10 years as well as create employment opportunities for additional 3.5 million workers by 2020 in RMG sector alone. Industry experts said the target can easily be achieved by exploring new markets in growing Asia, Latin America and Africa. Besides, there are bright prospects of increased export earnings from pharmaceuticals, shipbuilding, leather goods, jute etc and also increased manpower export.