Dhaka Chamber of Commerce and Industry (DCCI) has urged the government to create a three-year Emergency Fund with 1 percent interest to support the financially stressed local Micro, Small and Medium Enterprises (MSMEs) and informal sector for paying salary to their workers.
MSMEs with turnover Tk 1 crore can get loan with 1 percent interest and 2 percent interest for MSMES over 1 crore turnover, said the DCCI on Friday.
Factories located in the BSCIC industrial parks across the country also need to be brought under this emergency fund for paying salary and labour wages, said the chamber body.
MSMEs should be allowed a one-year grace period for this loan, it said.
Since coronavirus affects local export business to the European Union (EU) and the USA and the global trading system, DCCI urged the government to negotiate with relevant counterparts to restore the GSP facility in the US market and gain GSP plus facility to the EU market in near future.
DCCI felt that consideration of these opportune recommendations will enable MSMEs to sustain in this difficult and overcome the crisis and revive steering the economic growth in the near future.
It also urged the government to create a fund for public health safety.
Business, investment and economic activities are adversely impacted due to widespread outbreak of coronavirus globally, said DCCI in a media release.
Bangladesh’s economy encompassing export-oriented industries and local market-orientated manufacturing, agro processing and service industries, micro, small and medium enterprises, including trading businesses, transport, hotel, restaurant, grocery and informal sector comprising floating high small traders, shops have already encountered a severe blow appearing from this outbreak, it said.
Bangladesh under the leadership of Prime Minister Sheikh Hasina has undertaken timely and laudable measures to restrain the nerve-wracking consequences of this pandemic on businesses as well as public health, DCCI said.
It appreciated timely leadership of Prime Minister for pro-economic decisions during this precarious situation and creating a fund of Tk 5,000 crore for export oriented industries to support the salary and wages of their workforce.
This measure will surely leverage export-oriented industries as deferral, cancellation and drying-up of export orders put revenue stream of these industries at risk, DCCI said.
Though MSMEs of formal and informal sectors play important roles in driving the growth of the economy and creating employment opportunities, the financial strength of MSMEs becomes fragile, it said.
In order to reduce tax burden of MSMEs allowing cash flow in hand in some extent, DCCI proposed to defer submission of income tax of FY2019-20 for impacted MSMEs and entrepreneurs.
Impacted MSMEs are to be facilitated to pay the outstanding income tax splitting into three installments adjusting with tax returns applicable for subsequent three years without any penalty, it said.
Informal sector is the worst victim of the current onslaught of the coronavirus pandemic. Workers engaged in informal sector are most vulnerable to job loss.
Considering this, job loss victim should be brought under social safety net program of the Government.
Due to the outbreak, the delivery of containers from the sea ports and land ports has slowed. Importers have to pay port demurrage for delaying clearance goods, said DCCI.
Considering current standstill state and limited port operations, port demurrage and bank charges for MSMEs engaged in export oriented manufacturing activities, import businesses can be waived, it said.
source: UNB
