May 9, 2024
DHAKA – Prime Minister Sheikh Hasina today told parliament that the ongoing conflict in the Middle East, if escalates and gets prolonged, will affect Bangladesh socially, politically, and economically.
The premier said this in reply to a query of ruling Awami League MP Samil Uddin Ahmed Shimul from Chapainawabganj-1.
She said, “It is assumed that the indication of creating a conflict situation in the Middle East will affect the social, political, and economic aspects of Bangladesh as well as the whole world. This conflict may have some effect on the country’s economy.”
Sheikh Hasina said, “If the ongoing crisis in the Middle East worsens and gets prolonged, it may have an economic impact on Bangladesh. So, the government will take necessary measures in this regard.”
Sheikh Hasina also said specially due to the instability of the world market, inconsistencies in market management and the increase in global fuel prices, the country’s inflation is likely to increase slightly.
Besides, the PM said the crisis may led to a rise in exports related transportation costs to Iran or neighbouring regions.
As a result, exporters may face tougher competition as the cost of manufacturing and supplying products may increase, she added.
Sheikh Hasina, also Leader of the House said, in such a situation, she has directed all the Ministries/Departments to keep an eye on the ongoing events in the Middle East and determine their own course of action according to the developments there.
“I have given instructions to make necessary preparations considering which sectors may be affected specially if this conflict is prolonged. It is true that there is uncertainty about the intensity of this conflict and what its economic impact might be. To deal with the situation, there may be a need to support the sector with an emphasis on export trade,” she added.
She said, in this situation, her government has taken various measures in advance to mitigate the possible negative impact on the economy.
The measures include maintaining supply-demand balance, continuing cash incentive to encourage remittance and continue the Export Facilitation Pre-finance Fund.
PM said, at present, the government and Bangladesh Bank are closely monitoring the impact of the Middle East conflict on the country’s economy.
“If its impact is felt in any sector including industry and business, necessary policy support will be provided.”
The prime minister also said a conflicting situation in the ME could have some negative impact on LNG supply in the spot market if shipping in the Strait of Hormuz adjacent to Iran is disrupted. Besides, fuel prices and LNG prices are likely to rise.
“In this context, if it is not possible to import the desired amount of LNG cargo from Qatari companies under the long-term contract, there is an opportunity to import additional LNG from the Omani companies and spot market under the long-term contract,” she also said.