Rout graft, violence to get more assistance
Donors yesterday told the government if it fails to eliminate corruption and violence, and to bring transparency in governance and improve it, it would be difficult for them to continue assisting Bangladesh.
The donors made it clear on the opening day of the three-day Poverty Reduction Strategy (PRS) Forum in the city in response to the government's request for enhanced support from them.
"If over the next 15 months opportunities are held hostage by hartals and violence and by petty partisan advantage, the PRSP and all aspirations like it will be hollow. And the international community would have no choice but to review its support," said World Bank (WB) Vice President Praful C Patel at the inaugural session of the first-ever PRS Forum in the country.
Referring to the repeated ranking of Bangladesh as the most corrupt country in the world, he said, "Donors find it extremely difficult to support Bangladesh's critical development challenges under the kinds of pressure brought to bear by this issue, this elephant in the room."
Later, Prime Minister Khaleda Zia in her inaugural speech urged the donors to come up with more aids to help Bangladesh address its socioeconomic challenges and achieve the millenium development goals (MDGs). "We need continued support of our development partners," she said, "to sustain and carry forward our poverty reduction efforts and achieve the MDGs by 2015."
She expressed the hope that the forum would contribute significantly to a better facilitation of the development initiatives of the government and help forge greater understanding between the government and the development partners on issues of poverty alleviation and socioeconomic growth.
Khaleda also detailed her government's initiatives to curb corruption and to improve governance and law and order. About the Anti-Corruption Commission, she claimed, "After some initial teething problems, it has now become fully operational."
Finance and Planning Minister M Saifur Rahman, who chairs the forum, pointed out that the recent oil price hike in international market seriously affected the global economy, particularly those like Bangladesh. "To cater for the price-hike, we had to spend US $600 million more on our import in FY 2004-05 compared to the previous year. This could not be met without destabilizing the macroeconommic stability," he said.
He also mentioned that the situation also put the banks in liquidity crisis, adding, 'This has posed serious challenges to our PRSP target for deficit financing."
Saifur requested the donors to appreciate the state of imbalance and extend their support to overcome it. He particularly requested the WB to release the Development Support Credit (DSC) the soonest possible.
Referring to the Paris Declaration the finance minister said, "The aid committed should be disbursed in time to enable us to implement the budget framed on the basis of predicted aid. I must here mention the serious difficulties we have been put into due to the unpredictability of DSC-III." The WB has decided to defer discussing disbursement of the $200 million third tranche of the DSC as the government is yet to fulfill a major condition of cabinet approval of a Public Procurement Law.
In his speech, Patel said the WB is committed to doing its part in translating the PRSP into action on the ground, adding, "we call upon Bangladesh's development partners to align their support to the strategic priorities identified by Bangladesh."
Forecasting on the coming days, Patel said, "But even our best efforts will take us into difficult times ahead." Because, he said, apart from tough and unpredictable external environment with global energy prices remaining high, domestic challenges will inevitably focus around election.
However, the WB VP maintained that if Bangladesh's reform priorities become a responsible part of election campaigning, engaging the electorate in understanding the reform challenges and choices, "then ideas articulated in excellent plans like the PRSP stand a chance".
He highlighted three areas -- infrastructure, local government support and good governance -- as tough reforms by any measures for PRSP realisation.
Emphasising infrastructure development, especially undertaking of a detailed power generation and financing plan, Patel said all procurement of generation capacity should be in line with the Public Procurement Regulations.
He urged the government to make all small power plant projects transparent and competitive. In this regard, he said, "The least cost generation plan should be implemented with all procurements, large and small, following the public procurement regulations, and/or the soon-to-be approved procurement law."
Asian Development Bank (ADB) Managing Director Young Hoi Lee identified improving governance and law and order, uprooting corruption and making the civil service effective and functional as the major challenges for the implementation of the PRSP. "Improvements in these key areas are essential to achieve acceptable levels of public spending efficiency, effectiveness and accountability," he said.
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