Sheikh Shahariar Zaman

The country is expecting less remittance and export earnings in the months ahead due to global recession and the foreign currency loss can be offset by wooing non-resident Bangladeshis (NRB) to invest more and buy premium bonds, economists said.

"The recession has hit hard developed countries and being part of the globalised world, Bangladesh is not immune to the crisis," said former Bangladesh Bank governor Mohammed Farashuddin.

If the country receives less in remittance and export earnings, it has other instruments to fill the gaps, he said.

"Bangladesh Bank has different instruments to attract NRBs to invest in the country, but they must get due benefit," he added.

Remitters should be pampered to avail those instruments and convert the remittance into equity, he suggested.

"It will help in two ways. Firstly, the country will get more investment and secondly, it will increase production," he explained.

Most of the remittance earnings are consumed, but if it is channeled into the productive sector it would increase production, Dr Farashuddin said.

The country earned $6.148 billion remittance in July-February period, which was $4.48 billion in the same period of the last fiscal. Export earnings also increased by $1.4 billion to $9.131 billion in July-January period.

The recession followed the collapse of financial giants in the US and European countries in September and spread around the world leading to bailout packages worth billions of dollars announced by the major industrialised countries.

Bangladesh needs to formulate its own mechanism to withstand the crisis, said former deputy governor Allah Malik Kazemi.

"The government cannot control the flow of remittance and export earnings and therefore it should emphasise more on creating local demand," he said.

The central bank offers lucrative US dollar premium bonds at a rate of 6.5 per cent for NRBs and the government offers incentive packages for foreign direct investment, Mr Kazemi said.

"It is not clear how much the country will be affected due to the global meltdown, but the foreign currency loss can be counterbalanced through the instruments," he said.