Reshuffling Bangladesh’s economic managers
It’s June. That means, Budget time.
That means a lot of op eds and talks about policies that are pro-poor or anti-poor, visionary or fraudulent, ambitious or unrealistic. For my part, I’ll write (either here or in Dhaka’s print-media) about the economic and fiscal outlook and other jargon-laden boring stuff.
But before we get to that stuff, let me indulge in some wistful thinking. If I could shuffle Bangladesh’s economic management team, whom would I choose?
Let’s begin with clarifying definitions. What do I mean by economic managers?
By economic managers, I mean ministers and senior bureaucrats who are in charge of economic policymaking. These would include finance, planning, commerce/trade, labour, industry, agriculture (and perhaps food, education and transport/communications ministers), Prime Minister’s advisors on these issues, secretaries of the relevant government departments, heads of relevant commissions, and the governor of the Bangladesh Bank.
That’s a lot of people. I am going to take a short cut and concentrate on only four: finance and planning ministers, the PM’s economic advisor, and the BB governor.
I am also going to constrain myself with political reality: whoever gets these jobs must have impeccable Awami credentials — no Robert Gates like bi-partisanship is feasible in Bangladesh (not that it matters, because I can’t think of that many solid pro-BNP economists anyway).
Right. Let’s get down to business then.
1. The Finance Minister.
I am going to stick with Mr Muhith. This is not because he has been a stellar minister. Far from it. Compared with SAMS Kibria or Saifur Rahman, Muhith’s ability to shape the policy direction against narrow party / bureaucratic / donor interests is very limited. He is also in poor health. But I’d still keep him for two reasons.
First, when I look around AL front bench, I cannot see anyone more qualified to run the ministry. And it’s important to have key ministries run by elected politicians if we want to strengthen our parliamentary democracy (if we were to switch to a presidential system, it would have been a different matter).
Second, with changes to the other three key posts, it might be useful to have Mr Muhith as the ‘anchor’. In fact, he may perform much better if assisted with the people mentioned below.
2. The Planning Minister
When the AL government came into office, I worried about the fallouts of the global financial crisis on the Bangladeshi economy, but felt optimistic about the longer term because I expected AL to address key structural and supply-side issues. That optimism took a hit when AK Khandker was named planning minister.
The planning minister, and the Planning Commission, ought to play a much more important role in shaping medium to long term policy directions. If we are to lift industry’s share to 40% of the economy, then where will the required investment come from? What is the right land use policy given our shortage of arable land? Or what wage policy will strike the right balance between a living wage and export competitiveness? What regulations and micro governance hinders investment? These are the kind of questions planning ministry ought to wrestle with. And at its head should be a minister who not only is a qualified economist, but is also fully across the Bangladeshi reality.
My choice for the role is Dr MK Alamgir.
Not only does he have the required qualifications (a PhD from Boston University on development challenges facing Bangladesh) and experience (he served well in the position in the last AL government), but also as a seasoned bureaucrat in both Dhaka and the districts, he knows which reforms will and won’t work in Bangladesh. And he amply meets the political criteria of Awami credential (in fact, he meets it so well given his role in 1996 that it disqualifies him from getting the finance ministry, a position he would be pretty good for otherwise).
A crack reform team in Planning Commission under his stewardship as the minister would go a long way towards achieving the government’s medium term economic ambitions.
3. Economic Advisor to the Prime Minister.
It’s not really clear what role the PM’s advisors should have in our system. In practice, these advisors tend to be in charge of some specific aspect of the relevant policy. The economic advisor could, thus, advise on the government’s India policy, or the political handling of an economic issue such as the DSE debacle.
If the advisor has to advise what the PM wants to hear, then I guess there is no point in blaming the current advisor. No one else can do the job any better. And that may well be the case. But even so, I think Dr Mashiur Rahman is doing his boss a disservice by shooting his mouth off. His remarks and interjections in the transit or DSE debates were, well, stupid. And just in case the PM actually is open to solid advice, I am not sure the current advisor is capable of providing them.
I would choose the younger, fresher face of Dr Reza Kibria. A former IMF economist and a Dhaka University faculty, with practical experience in a number of different countries, he has the right blend of skills and temperament for the job. And oh, as the son of SAMS Kibria, advising the current PM could be a good apprenticeship for a ministerial position when Mr Sajeeb Ahmed Wajed (or one of his cousins) is the prime minister in the 2020s.
4. Governor of Bangladesh Bank
When he was appointed in the role, I said that Dr Atiur Rahman was grossly unqualified for the role. His failure in stemming inflation, or the bubble-and-bust of DSE, or him playing the government’s stooge in the Yunus fiasco only add to the case against him. Bangladesh has been very lucky that this appointment has not done more damage.
Ideally, the central bank governor should be someone from within the ranks. But given the political reality of appointing people with party connections to key roles, we need to look outside the Bank. I understand that the government had considered Sadiq Ahmed, a former World Bank economist, for the job. He is well qualified for the job. Apparently he was not chosen because of possible allegation of nepotism — his father-in-law is one HT Imam.
Well, if Sadiq Ahmed is appointed in any key economic management position that he is qualified for, this blog pledges to support him against any nepotism charge.
AL is half-way through its term. No matter what electoral and political chicanery that transpires over the coming months, it will be the economic issues that will make or break AL’s case for re-election. Alamgir-Kibria-Sadiq will make that re-election far easier for the PM than anything Khondoker-Mashiur-Atiur can do.