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He says the capital market needs to be strengthened for the sake of the economy
Published : 28 May 2024, 01:30 AM
Salman F Rahman has said that fluctuating share prices are a “natural thing” and the government should not interfere in the capital market.
Instead, he said, the government will need to monitor the market only to prevent manipulation.
The prime minister’s adviser on private industry and investment spoke his mind in a media briefing after a meeting with an executive delegation of the US-Bangladesh Business Council on Monday.
“The capital market is a market force. Prices will rise and fall here. I think the government should never interfere in it,” he said after the meeting at Bangladesh Investment Development Authority or BIDA.
“It’s not just about Dhaka Stock Exchange or Bangladesh. Prices fluctuate in all share markets. The government needs to monitor if there is any manipulation.”
Also the vice-chairman of leading conglomerate Beximco Group, Salman expressed his concern over a lack of institutional investors in Bangladesh’s capital market.
“What we have is small retail investments. But the thing is, when prices fall, institutional investors stabilise the market in a day. Retail investors panic when prices of good company shares fall, as there is no institution.
“We’re working on increasing the number of investors in the share market.”
The capital market needs to be strengthened for the sake of the economy, Salman said.
“In every country, you’ll see new investors or companies seeking expansion to meet their goals by raising funds from the stock market. But here, everyone takes loans from banks,” he observed.
He noted the Securities and Exchange Commission was working on Prime Minister Sheikh Hasina’s recent instruction to list the good government firms and strengthen the bond market.
Salman hoped Bangladesh’s economy will stabilise further by December with the finance ministry and the central bank working on reforms to the banking sector.
“Of course, there are challenges facing the economy, but we can tackle those. The dollar crisis is also easing,” he said.
Regarding the meeting, he noted that US businesses were interested in expanding their investments in Bangladesh, provided there is a stable tax policy.
“They want the tax rates to remain unchanged for the next five to 10 years. They lose interest in investment if the rates are hiked suddenly. Amazon has already been doing business here. They want to export our products,” the adviser said.
Besides Amazon, the meeting heard from representatives of Boeing, Excelerate, Meta, Visa, and some other companies.
