Dhaka, May 11: The Metropolitan Chamber of Commerce and Industry has proposed six remedial measures for restoring stability in the capital market and ensuring its healthy growth.
In its quarterly review on the country's economic situation, the premier chamber suggested that the government institute a thorough reform of the system in the capital market by framing the necessary short-term, mid-term and long-term rules and regulations after discussion with all stakeholders.
The government should quickly offload the shares of the selected profitable state-owned enterprises as it promised earlier, said the chamber.
The multinational companies operating in Bangladesh should be asked to enlist themselves in the country's stock exchanges, said the MCCI. 'Such enlisting is compulsory in the neighbouring countries.'
MCCI observed that the Dhaka Stock Exchange and the merchant banks would have to be more active to attract more private issues to the market.
It said that the Dhaka Stock Exchange might persuade the big listed companies to offload a bigger percentage of their shares to meet the growing demand for shares in the market.
Strengthening the market's regulatory mechanism and making it more transparent and accountable is crucially important to increase public confidence in the stock market, MCCI pointed out.
Its review said that in the January-March period, there were mixed performances in Bangladesh's economy with healthy growth in agriculture, strong recovery in the export sector, but decline in foreign aid inflow and remittance.
'Output performance in agriculture has continued to remain healthy, thanks to good weather and favourable government and central bank support for the sector,' said the MCCI.
The rise in private sector credit and the increased volume of letters of credit opened in recent months indicate that manufacturing activities are on the rise, it added.
Despite the installation of some additional generation capacity and some increase in electricity production, the power situation has not improved much in the period.
The average deposit rate increased faster than the average lending rate, said the review which acknowledged the concern of a section of the business community over withdrawal of the lending limit and the increased cost of capital.
The MCCI stressed the need for meeting the challenge of inflation, in particular to contain the prices of food items, and increasing the supply of power.
Source: New Age
