By Ashis Biswas
For a Bangladeshi job seeker, securing any kind of employment is naturally preferable to joblessness. But, in the post-Ukraine war period, it does not make a world of difference, as before.
Bangladeshi workers are currently facing their worst economic crisis in decades, with barely a glimmer of hope that conditions are going improve anytime soon. As this country of over 160 million people braces for critically important general elections early next year, both the ruling political establishment and the opposition feel increasingly queasy about an impending economic meltdown during 2023-24. Neither side has many options at this juncture.
The bottomline for the ruling Awami League (AL) and leading opposition outfit, the Bangladesh Nationalist Party (BNP), is: it may not be possible to put together a financial rescue package for the working population as well as the poor in Bangladesh in the medium term. The number of workers in the country is over 70 million, of whom 90 percent are struggling financially in the post-Ukraine war scenario. As for increasing poverty levels, opposition leaders claim that an additional 20 million people have fallen into acute financial distress in the post-pandemic era.
This doomsday narrative has not been churned out by Islamic extremists determined to unleash terror and chaos in South Asia. The World Economic Forum (WEF), in a recent country-specific analysis, predicted high inflation, a major debt crisis and commodity price shocks to challenge the Bangladeshi economy in the years ahead, without any indication of a timeline.
Signs of the economic turmoil ahead have been seen in 2022 itself. The usually healthy forex reserves enjoyed by Bangladesh declined steeply to around $28 billion this January, as against $30 billion in December. It had been normal for Bangladesh to enjoy reserves of $35 to $40 billion up to the mid-2020s.
With financial control slipping out of their hands, the Awami League leaders lost no time in contacting organisations like the International Monetary Fund (IMF) and the World Bank (WB) to secure short-term respite. The IMF advanced $4.5 billion and the WB extended $1 billion loan, by way of immediate assistance. But along with the relief came conditions imposed on Dhaka, to do away with power sector subsidies and other welfare measures intended to help common people. This has triggered a sullen anger among people who now pay much more for power, in addition to paying far higher prices for transport, food and medical costs.
The inexorable fall in the value of the Bangladesh taka vis-à-vis the US dollar continued, making critical imports costlier. But far more damaging to peoples’ morale and the official image of the ruling Awami League, currently navigating the critically sensitive pre-election period, was the major cyber heist by organised criminal operatives in the Bangladesh Bank from 2016 onwards, which impacted normal work in 38 other banks. Nine banks reported a provision shortfall of taka 13,219 crore (1 USD equals around 110 BD taka), as their capacity to withstand major defaulted loans suffered.
The bank fraud was the worst possible case for Bangladesh during the ongoing Ukraine war, with prices of fuel, fertilizers and food items already sky-rocketing.
Only the remittances sent home by workers held the economy somewhat steady, along with huge daily collections at the new Padma Bridge, built entirely with the country’s own resources, which remain among the few positives in the Bangladesh economy at present.
However, by 2024, another major shock awaits Dhaka-based policymakers. Of the 40-odd internationally-aided infra projects in progress, repayment of debts against 13 projects would become due. Estimated amount happens to be around US $ 33 billion. For the first time, there are worries among Bangladeshi economists as to how the country would cope with the challenge. Before the Ukraine war, Dhaka had a proud record of meeting all its repayment schedules in internationally-aided projects on time.
Fortunately, a general concern over the gravity of the situation is shared among the political establishment and the common people — including trade union leaders and workers themselves. Which partially explains why there hasn’t been any major industry-wide agitational upheaval in Bangladesh as yet.
Ruling AL leaders have lost no time to claim credit for a deceptive assertion that prevails in Bangladesh public sphere. Prime Minister Sheikh Hasina, dutifully echoed by her supporters, has reminded hard-pressed citizens how Bangladesh has “avoided the fate of Pakistan or Sri Lanka” in the region.
However, such hype can at best be partisan: the opposition BNP has been steadily recovering its lost support base. It successfully organised major rallies despite non-cooperation from police and other authorities. BNP leaders, following established third world traditions of political campaigning, have scathingly attacked the “hostility” of the AL towards the “working people in crisis”.
While Prime Minister Hasina has warned garment sector workers as well as common people that it would be a bumpy ride for a while and everyone must tighten their seatbelts, the BNP rubbished this as a major official failure to protect the workers and the poor during a crisis.
For all the concern expressed by global platforms like the International Labour Organisation (ILO) and human rights groups about the steady erosion of working class rights and facilities at present, the Bangladeshi working class can expect little support from any quarter.
Yet, the strains of daily living for the majority of Bangladeshi workers can no longer be concealed, let alone be ignored. Case studies and reports about the crisis at hand abound in the Bangladeshi media. As a worker in a garments factory recently asked, how even a small family of four-five persons could hope to survive on a minimum monthly wage of taka 8,000 earned by one breadwinner, when one single egg costs taka 16? Employed or jobless, citizens have had to shell out far more by way of personal transport and power consumption costs in the post-Ukraine war period, thanks to the overall inflation, without any opportunity of casual earnings on the side during an undeclared depression.
As in Sri Lanka some time ago, there are reports of Bangladeshi workers and poor people giving up one daily meal and feeding children on priority. Many are walking longer distances to work. However, the pale silver lining is that but this countrywide misery could be somewhat stemmed by the summer/monsoon months ahead.
Contrary to the opposition claims, the AL government has not been indifferent to working class interests. Prime Minister Hasina asserts that workers’ average wages in the garments sector, where around 41,00,000 people work, rose from around taka 1600 a month in 2008-09 to around taka 8000-10,000 from 2018 onwards. The PM says that further wage increases were being planned. However, the grand designs were stalled by the post-pandemic economic lockdowns, which were followed by the devastating economic impact of the Ukraine war on developing countries, taking a heavy toll in Bangladesh.
PM Hasina also emphasized that even the advanced economies in the West, which imported Bangladeshi garments in bulk sustaining the country’s economy, suffered from post-Ukraine war inflation. This led to a drop in Bangladesh’s exports. Referring to a few instances of work stoppages, she strongly warned trade union leaders not to stir up trouble and disrupt the few export orders still coming in.
It attests to the high degree of political maturity and statesmanship in Bangladesh that most trade union leaders assured PM Hasina that they would do their best to mitigate the workers’ anxiety and not cause further problems for the AL government.
But the question remains, for how long would the Bangladeshi workers have to put up with pay cuts up to 50 percent, or recurring 15-day lay-off every month? Clearly, the road ahead for both the workers and the government in Bangladesh will continue to be a thorny one. (IPA Service)