Few Findings from Mr. Nasim Manzur's Column in Daily Star

Decoupling is a highly discussed issue in the global economy. What it actually means is disintegration between different economies around the world (Although it has other meaning in economics like disintegration between economic growth and growth in environmental hazards). As the global economy is going through a bad time now, everyone is talking about decoupled economy, the economy that is remained more or less unaffected due to global economic turmoil. These decoupled economies might give an opportunity for diversification of the portfolio of global investors. So during the bad time, at least some part of their portfolio would remain unaffected.

And consequently economy of Bangladesh comes into discussion. As Bangladeshi financial system was totally unrelated with the outside world financial system, local financial institutions are not feeling the heat of global turmoil. The major stock markets have lost around 40% of their value this year, whereas Dhaka Stock Exchange remained mostly unaffected (Around 2% drop this year). Oil price has gone down, which is very good news for Bangladesh, as we are an oil importing country. So it is all happy going for Bangladeshis. But today a column published in The Daily Star by Syed Nasim Manzur (MD of Apex Adelchi Footwear and a very good economic analyst. The link to the article is http://www.thedailystar.net/story.php?nid=58711) has caught hold my eye. He has pointed out few areas that challenge the entire concept of decoupling and also challenges the belief that Bangladesh is in an advantageous position. The main points that I found in his writing are:

- Recession in the west might create demand for lower priced goods. So the export sector might be affected due to price cut by the international buyers.
- As major foreign currencies becoming weaker against taka, the exporters will lose their competitive advantage.
- Oil price may hit the economy of Middle East, the major employer of Bangladeshi labor. So the labor export might slow down. So will be the flow of inward remittance.

So we are in no position to sit back and relax, watch the global economic turmoil with academic interest. We need to be as active as the other developed nation to combat the global slowdown.