Banking commission needed to fulfill AL’s election manifesto: Dr Monzur Hossain
He highlighted the need for reforms in macroeconomic management to achieve stability
A banking commission comprising experts, economists, and policymakers may be useful for the government in fulfilling the reforms pledged by the ruling party in its election manifesto, Dr Monzur Hossain, research director of BIDS, said today (24 March).
He made the comments at a seminar titled "Unpacking the Economic Manifesto of the Awami League: Trends and Challenges for Tomorrow's Bangladesh" held at BIDS conference room.
Speaking at the seminar, Monzur Hossain also said acquisition and merger, while a positive step, must be dealt with caution and careful consideration.
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He emphasised the key challenges of macroeconomic stability outlined in the Awami League manifesto, including inflation, exchange rate volatility, foreign exchange reserves, international trade, current account balance, and the fragile financial sector.
He highlighted the need for reforms in macroeconomic management to achieve stability, focusing on policy options for the financial sector.
Monzur Hossain mentioned that strict enforcement of laws must be ensured against loan defaulters, money launderers and financial irregularities to boost the confidence of customers.
"At the same time, loan rescheduling and loan write-offs need to be discouraged," he added.
He further suggested that both banks and non-bank financial institutions should establish boards comprising experienced bankers and experts.
Additionally, he advocated for the prohibition of new banks for at least the next five years.
Monzur Hossain underscored the need for reforms in macroeconomic management to achieve stability, focusing particularly on policy options for inflation management.
In this regard, he emphasised the necessity of adjusting energy prices in line with international market trends and advocated for avoiding adjustments during periods of high inflation.
He suggested the development of a formula-based mechanism to facilitate this process
He added that there must be a strengthening of fiscal and monetary policy coordination to address inflation.
