Most of the small and micro enterprises (SMEs) have not received any stimulus package since the pandemic began in March last year in Bangladesh, finds a study report.
Only six percent of the SMEs applied for a stimulus package and one percent of them received the benefits so far, according to the study jointly conducted by BRAC Institute of Governance and Development (BIGD) and Australia’s Monash University. The report was released on Tuesday.The SMEs are yet to recover from the negative impacts of the first wave of the pandemic. There are also severe impacts on the economic and psychological wellbeing of the workers.
The government has announced stimulus packages worth Tk 27 billion to help small, medium and cottage industries and expand social safety coverage.
According to the study, a quarter of the loans came from development agencies and another 16 percent came from family or near ones. Only four percent of the received aid was from the government.
The survey finds that recovery has been the lowest in female labour-intensive sectors and those with higher health risks like beauty parlours.
Most of the surveyed firms were light engineering and 16 percent were from service sectors like tailoring and beauty parlours.
Additional secretary at Ministry of Industries Luthfun Nahar Begum, research director at Bangladesh Institute of Development Studies (BIDS) Dr Monzur Hossain and CEO of Business Initiative Leading Development (BUILD) Ferdaus Ara Begum joined the report launching event held virtually as guests of honour. BIGD executive director Dr Imran Matin conducted the session.The researchers said the business activity returned to almost pre-corona pandemic levels just before the second lock-down was imposed. However, three percent of the firms remained closed since the start of the pandemic.
The workers of these enterprises remain at a much greater risk, although the unemployment among male workers reduced to 15 percent in June 2020 from an extremely high rate during the first lockdown, and it has remained unchanged since.
Luthfun Nahar Begum said the government has already introduced 23 stimulus packages amounting to Tk 1.24 trillion in support despite the low uptake.
BIGD executive director Dr Imran Matin said the micro enterprises with greater health risks were hit hardest despite safe reopening measures and hygiene practices were promoted. Unemployment among female workers has in fact worsened from last June and stands at a whopping 54 percent.
Thus income is down from pre-pandemic levels by 24 percent for men and 56 percent for women, eight months after the first lockdown was lifted. Consequently, psychological stress during the pandemic is significantly higher for female workers, particularly those who are unemployed, the study mentioned.
The SME sector contributes one-fourth of the Bangladesh GDP employing 56 percent of total 170 million populations, according to the officials.