Experts opined that addressing challenges related to economic impacts among Bangladeshi SMEs due to COVID-19 pandemic would require an innovative and holistic approach that tackles regulatory issues, enables easier access to finance and recognises the challenges of the 21st century business landscape.
These, among many other conclusions were drawn at the dialogue on COVID-19 Economic Crisis and SMEs of Bangladesh held on Tuesday using Zoom online platform.
Speaking as the Guest of Honor, Industries Minister of Bangladesh Nurul Majid Mahmud Humayun, MP urged to prepare a comprehensive database for CMSME sector of Bangladesh.
He said, a complete database will help smooth distributing of credit to all affected CMSMEs under stimulus package. Under Ministry of Industries and with the assistance of SME Foundation a CMSME database can be prepared across the country.
Terming SME is the lifeline of our economy, the Minister emphasized on coordinated efforts to frame a long-term planning, new employment generation, SME product diversification, strong monitoring on loan disbursement, health safety and tackling job loss amid Covid-19 pandemic.
Welcoming participants, BUILD Chairperson Abul Kasem Khan said that in the private sector, SMEs are the worst victims due to COVID-19 pandemic. He apprehended that unemployment may rise and economic dynamism might be stymied unless SME’s current situation improves.
He urged that the government should come up with insights and guidance for small businesses searching for ways to cope with the operational stress generated by COVID-19. Refinancing scheme can be a useful tool to improve access to finance for the SMEs
Ferdaus Ara Begum, CEO of BUILD presented the keynote presentation on ‘COVID-19 Economic crisis and SMEs of Bangladesh’. She highlighted the ongoing global economic crisis caused by the COVID-19 pandemic.
The session was moderated by Dr. M Masrur Reaz, Chairman, Policy Exchange where a number of SME entrepreneurs, policy experts, and practitioners spoke.
Dr. Monzur Hossain, Senior Research Fellow¸ BIDS said that it should be recognized that while MSMEs are the main drivers of the economy of Bangladesh, they have received the hardest punch due to COVID-19 pandemic.
Safiqul Islam, Managing Director, SME Foundation said that COVID-19 pandemic hit at the time when the business expansion in Bangladesh was occurring very swiftly. Now, the expansion of business as a whole and SMEs in particular has stopped due to the disruption of production owing to the prolonged lockdown.
Asif Ibrahim, Chairman, Chittagong Stock Exchange Ltd. said that the government set a good example of stimulus package disbursement to RMG workers through mobile banking accounts, and similar efforts should be undertaken for disbursing SME credit. Barrister Nihad Kabir, President, MCCI said that small and medium sectors are often lumped under the same category without taking into account the wide gulf of difference in size between the two sectors. Small borrowers are unable to follow the regulations followed by the medium or large borrowers. Only BDT 30 crore was disbursed in the stimulus package of working capital for SMEs.
Shams Mahmud, President, DCCI said that new opportunities have to be explored for solving the crises faced by the SMEs, e.g. there should be a drive for attracting more FDI in the coming days and integrating the SMEs into the value chain through a SME linkage policy.
Rashedul Karim Munna, Managing Director, Creation Ltd. mentioned that it will be a serious challenge for the government to include the informal SME sector into the formal and traditional financial channel. A SME database should be formulated to identify informal SMEs.
Mr. Abdul Karim, former Principal Secretary and former head of PKSF said that for proper utilization of the government packages, relevant recommendation from BSCIC submitted to Bangladesh Bank via MOI should beimplemented soon.