Reduced import costs brought down the country’s net trade deficit by 35 percent in the first six months of the current 2012-13 fiscal, relative to the previous financial year, though economists do not see as a positive trend.
The reduction is contribution of decrease in the import of capital machinery and industrial raw materials, implying fall of investment and production, they feel.
Financial analysts are not taking the reduced trade deficit entirely positively either. They also voiced similar reasons and said the statistics proved poor investment in Bangladesh.
Trade deficit went down almost $2 billion to stand at over $3.67 billion, according to the Bangladesh Bank statistics published Thursday.
First six months of the last 2011-12 fiscal year had registered a deficit of $5.58 billion.
A total of over $2.38 billion was earned in revenues from exports and over $6.06 billion was spent on imports until Jan 2013, the apex bank balance-sheet showed.
However, deficit in the service sector spiked during this period. Spending of the sector was just above $3 billion – over $2.1 billion increase from the $1.62 billion in the corresponding period last fiscal.
$900million net earning was recorded in this sector for the July-December 2012 period – 35.59 percent lower than the same period last year.
A reduction in trade deficit means people are saving more, leading to a decrease in investment.
“Balance of payment is exports minus imports… We are always in trade deficit. But it’s not good for the deficit to go down like this,” said Bangladesh Institute of Development Studies (BIDS) Research Director Zaid Bakht.
He explained this meant reduced import of capital machinery and industrial raw materials on account of slashed investment.
Imports went down $1.157 billion – 6.79 percent – during the first six months of 2012-13 fiscal as compared to $17.21 billion of the same time previous fiscal, the Bangladesh Bank statistics suggested.
Source: bdnews24
