2024: Rays Hope amid Political despair

Abu Sufian

Abu Sufian, Citizen Voice

The celebration of the English New Year influences all because of the widespread use of the English calendar in daily activities.

Every year, people across the world celebrate the New Year through various colourful programmes

but this year Russia-Ukraine war cast a pall of gloom to the global economic activities affecting the lives of the people.

The year 2023 was an important milestone in the life of the countrymen. The country witnessed a massive success

including the construction work of Padma Bridge, Metro rail was inaugurated for commuters from Uttara to Agargaon.

Amid this situation, Bangladesh Bank Governor Abdur Rouf Talukder said that the country’s ailing economy will hopefully make a recovery by June next year.

“There is nothing to worry about. We have passed the tough times and are now at the bottom line. There is no possibility of going further down,” he said.

“We will bounce back by the end of this fiscal year,” the governor said at a views exchange meeting

with the executive committee members of the Economic Reporters Forum (ERF) at his office.

The governor said the current account balance has already reached positive territory this quarter

and he is hopeful that the financial account will start to become positive by next March and moderately positive by the end of June.

we can imagine that there will be no increase in Fed policy rate. If it happens then secured overnight financing rate (SOFR) rate will start to decline from March 2024.” Responding to a query, the governor said it is undeniable that the import restrictions are causing some short-term damages.

“We have taken a number of measures to ensure that the supply chain is not disrupted,”

“If we can contain demand and increase supply, inflationary pressure will lessen significantly.”

that the country’s overall economy is doing very well, with strong fundamentals. Bangladesh’s economy has two main challenges — high inflation and the exchange rate.

We have set a target to bring down the inflation rate to 8% by December and 6.5% by June.

If we can achieve this, we can say that we have bounced back to our previous position,”

We will move to a crawling peg within a band, for which the IMF will provide technical assistance.

We will do this when our financial account starts to perform well. I will remain in a crawling peg for one or two years and

when I see that our position has returned to like it was in the past, we will move to a market-based exchange rate.”

A crawling peg is a system of exchange rate adjustments in which a currency with a fixed exchange rate is allowed to fluctuate within a band of rates.

The par value of the stated currency and the band of rates may also be adjusted frequently,

particularly in times of high exchange rate volatility, according to investopedia.com.

I want to come back in my point of view that we are now living in a world where politics and economics have been so closely integrated that politics can no way be kept aside.

Politics, even in some cases, have overturned economics, so a good understanding of politics is a must for following the economy and financial prospects.

So, it is very difficult to refrain from all political aspects, particularly when issues like national elections come up. After reading recent media reports, news, articles,

and magazines, I realised that election fever is going to sweep across the world as the highest number of countries will go for national polls next year.

So far it is learnt forty countries in the world will hold national elections in 2024. Starting from Bangladesh

at the beginning of January to the US election in November, a total of forty countries across the world will hold their national elections.

It is reported in Western media that voters in the countries representing 41% of the world population and 42% of world GDP (Gross Domestic Product) will cast their votes to elect national leaders in 2024.

Bangladesh is the first country to hold the national election on January 7, 2024, followed by Taiwan, where election also to be held in January.

Other important countries that will go for national polls include India, Pakistan, Indonesia, the UK, South Africa and Russia.

Although not well-covered in the Western media, the national election in Bangladesh has drawn the serious attention of the US administration.

India, China and Russia have candidly opened up their stance about the Bangladesh election.

This is the first time some superpowers have shown their direct interest in the ensuing national election in Bangladesh.

Previously, influence of some Western countries, particularly the USA, has also been experienced, especially in the 2001 election.

This year the Western world, particularly the USA, move has surpassed the previous record and even diplomatic norms.

Even, the US administration want to apply their tools visa policy, sanction and recent labour policy.

Even the European Union has also moved to some extent but tried to be within the limit.

After Bangladesh, Taiwan’s presidential election will be held in January, which may set the strategy for US-China relations for coming years and tension may further escalate if current Vice President Lai Ching-te wins.

In the Indonesian election to be held in February, Prabowo Subianto, who was a Lieutenant General during Suharto era

and once was subject to US Visa restriction for alleged human rights abuse, has come to the forefront,

especially after he proposed a peace plan for the Ukraine war what would allow Russian forces to leave the place.

In the coming election in South Africa, the ruling African National Congress is speculated to lose its absolute majority and may fall into coalition government with other parties.

In India, the national election will be held next year and current Prime Minister Narendra Modi may face steep competition if all opposition political parties form alliances.

If it really happens, causing a surprise loss for the running prime minister, there can be a risk for investors in the USA and its allies considered India a counterweight to China’s economic

and military power. In the USA, former President Donald Trump possesses a high chance of contesting, and he is reportedly leading in key swing states,

casting a shadow of huge uncertainty over the future of American policy on China, Russia, NATO, Trade, and many others.

In Russia, the national election is scheduled to be held in March and President Vladimir Putin is anticipated to win without major contest.

In the UK, the national election is expected to be held next autumn when the opposition Labour Party led by Keir Starmer may defeat Rishi Sunak’s Conservative Party.

If such speculation holds true, Starmer will be required to secure a huge majority to tackle Britain’s deep-rooted economic problem.

Apart from political upheaval over election fever in 2024, there is uncertainty over the rules of the games, interest rates, how the market is likely to move, government regulation and policy.

Therefore, money managers, investors and corporate planners are keeping a close watch and moving with extreme caution in their investment decisions.

It is further learnt that governments and companies are engaged in the global competition to lock down supplies of raw materials needed

to transition to cleaner energy and protect local industries.

In every election from Bangladesh, Taiwan to the USA, much will depend on how divergence different political parties may have on some crucial areas including national security, world politics, trade &commerce, and investment.

With an anticipated change in policies, there are likely chances of leadership change in the powerful and influential countries

which may result in new friction and alignment among the counties and regions.

pandemic, two brutal wars, inflation, high borrowing costs and probable election fever across the world.

All big countries, including the USA, India, the UK and Russia, will remain in the election race,

so, there should not be that much time for the incumbent government and policymaker to bring substantial change in the policy related to trade and investment.

At the same time, investors, money managers and the corporate world will also remain in very uncertain situations because of the probable outcome of election results.

So major investment decisions may remain paused or deferred. Therefore, a kind of stalemate in the world economy,

created since the pandemic outbreak, furthered by the Russia-Ukraine war and followed by the recent Israel-Hamas war, may continue prevailing next couple of years.

Finally,

May this year bring new happiness, new goals, new achievements, and a lot of new inspirations on your life. Wishing you a year fully loaded with happiness.

Wishing every day of the new year to be filled with success, happiness, and prosperity for you. Happy New Year.

 

 

 

 


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