Remittance sent by immigrant workers is the major driving force of Bangladeshi economy.
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| [AL MONITOR ] |
The economy of Bangladesh which is often considered as the rising tiger of South Asia is in imminent threat for this Corona pandemic.
Remittance sent by immigrant workers is one of the major driving force of Bangladeshi economy which was more than $18 bn in 2019.This number is nearly 5% of the country's nominal GDP.There are more than 10 million Bangladeshi people who are living in abroad most of them are workers.According to Wikipedia's 2018 data 2.2 million Bangladeshi immigrants are living in Kingdom Of Saudi Arabia which is the largest number of people in case of Bangladeshi diaspora. Most of them work there as labors.For the last couple of years Saudi Arabia has secured the position of becoming Bangladesh's top remittance source. But experts are afraid of losing this lucrative remittance source. Let's see why.
Saudi Arabia, the only member of G20 from Arab world is going through an economic chaos. This largest economy of Middle East will borrow $58 bn in 2020 from different international sources recently stated by Mohammad Al-Jadaan the finance minister of KSA.This corona pandemic has caused the crude oil export based Saudi's economy at stand still as well as the whole world.Now because of the worldwide lockdown the oil price is at the lowest rate ever in the history. But they can't stop mining oil as there is huge possibility of losing billion dollars oil mines. This is hitting Saudi's economy harder than before.
Before this pandemic Saudi Arabian economy was in debt burden.Saudi's external debt was $151 bn and $181 bn in the year of 2018 and 2019 respectively which shows a high rising rate.Surely this rate will go above in following years.According to Middle East Eye Saudi's total debt has jumped by more than 1500 percent from 2015.Again their cash reserve is decreasing at an alarming rate.Where the reserve was $732 bn in 2014, it came down to $499 bn in 2019 according to Saudi Arabian Monetary Authority. There are few economies in the world which saw this kind of decreasing rate of reserve in the 21st century.Now this pandemic is to pour water on a drowned mouse.
Many reasons can be pointed out for Saudi Arabia's this economic phenomenon. First of all, Saudi Arabia is the top arms buyer according to the Stockholm International Peace Research Institute(SIPRI). In 2017 crown prince Salman Bin Abdulaziz signed a $100 bn immediate defence equipment import contract with US president Donald Trump. In total, $350 bn over 10 years long arms supply.Saudi Arabia has spent a lot in ongoing Yemen and Libyan War.
Corona pandemic has come at this very time while many Bangladeshi worker are coming back home from Saudi Arabia and most of them are women because of various miserable duties in their workplace. Before this pandemic many Bangladeshi store owners was going through the tax anxiety as the Kingdom is continuously increasing tax rate over foreign citizens in Saudi Arabian soil.Crown Prince Salman Bin Abdulaziz has introduced Economic Goal 2030 which is mainly a dream of making their economy more diversified,attracting citizens to higher education and making them more active.This goal includes many mega projects.Now because of these mega projects Saudi will seek for foreign workers shortly but it will decrease the number of foreign workers there.
Now experts think that nearly 1 million Bangladeshi immigrants will have to return to home directly or indirectly because of this corona crisis.This will really be devastating for Bangladesh's remittance flow as well as whole economy because if Saudi's economy loses it's stability which is in the process already, the overall middle eastern economy will be affected.
Question arises that after coming home what will our remittance fighters do if they won't want to go back or won't have the chance? Most of them will try to start small businesses such as stores and whole selling. But it will be crucial for them because after pandemic our people's the purchasing power will be decreased.
So,our government should search for new remittance markets and do more agreements with foreign governments if they really want continue the healthy remittance flow as well as the GDP growth rate.And of course they should stop the urge of immigration brokers and agencies of Bangladesh because they are only reason of illegal Bangladeshi immigrants.
The author is a student at Department of Criminology, University Of Dhaka.
