The Enterprise Growth and Bank Modernisation Project (EGBMP), initiated by the government, is helping the private sector to create more jobs through its efficient financial sector performance. The World Bank (WB) is providing US$ 257.63 million to implement the project to create jobs through private sector enterprise growth and promote speedy reforms within State-owned Enterprises (SoEs) and the Nationalised Commercial Banks (NCBs).

Since the start of this initiative in 2004, a Small Enterprise Fund (SEF) was set up to promote private sector small enterprise growth and it has so far disbursed more than Taka one billion to 1,337 small enterprises, creating additional jobs for 2,527 people. It has converted Adamjee Jute Mills into an Export Processing Zone, creating jobs for 34,000 people till now, while this number is likely to increase to 70,000 in future.

The Karnaphuli EPZ, being built at Chittagong Steel Mills, is expected to create 24,000 new jobs, and eventually will generate some 50,000 jobs when fully completed. Through this initiative, the Bangladesh Export Processing Zone Authority and Board of Investment have strengthened their institutional capacity in the areas of investment promotion, training, and computerisation programmes. BEPZA Counsellors are now equipped with sound labour management practices and took mitigating steps during last year’s labour unrest.

Under its Voluntary Retirement Schemes, 27,000 retrenched workers of closed down/privatised SOEs received payments and its safety-net programme provided counselling, retraining, and access to credit for the retiring workers. It also provided stipends and training for children of the retiring workers. Of the 1,054 retrenched workers registered with Job Information Bank, 185 people have already got alternative jobs and 811 children have received education stipends.

After a slow progress, the Bank Modernisation component of this initiative is finally catching up. The privatisation of Rupali Bank Limited is at the final stage now, and the Government has already decided to corporatise the other three NCBs – Sonali, Janata and Agrani Banks. A new NCB-restructuring plan of the Government will also be financed under this initiative. Country Assistance Strategy (CAS) will guide the WB’s operations in Bangladesh during the period 2006-2009 that is strongly focused on governance and is aligned with Bangladesh’s Poverty Reduction Strategy (PRS).
The CAS has two pillars, improving the investment climate and empowering the poor, reflecting the focus of the World Bank’s programmes across sectors.

The WB said that it is supporting the government’s Local Governance Support Project (LGSP) with a commitment of US$111.5 million credit which will allow Union Parishads (UPs) respond better to community needs and deliver services in a transparent manner. Under this project, the government will provide increased block grants to the UPs. The UPs must provide annual audits and take steps in improving transparency of budgeting and expenditure and they will receive this grant directly. The project will be implemented in phases. Starting July 2007, 25 per cent or around 1000 UPs will be covered and eventually all UPs will be included in the next four years.