Showing items 1 - 13 of 13

COVID-19 effects on public finance and SDG priorities in developing countries : comparative evidence from Bangladesh and Sri Lanka

- Colombage, Sisira, Barua, Suborna, Nanayakkara, Madurika, Colombage, Udari

  • Authors: Colombage, Sisira , Barua, Suborna , Nanayakkara, Madurika , Colombage, Udari
  • Date: 2023
  • Type: Text , Journal article
  • Relation: European Journal of Development Research Vol. 35, no. 1 (2023), p. 85-111
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  • Description: The COVID-19 pandemic, an unprecedented global health crisis, rapidly transferred into a global economic and social crisis. The pandemic has threatened the world’s commitment to achieve Sustainable Development Goals (SDGs) by 2030 as governments in developing countries have shifted their priorities from attaining SDGs, to providing urgent financial needs to save lives and prevent recession in hopes for a rapid economic recovery. The rerouting of public funding priorities has undermined the progress and achievement of SDGs. We employed a mixed-method and carried out a comparative study using pre- and post-public financial data of two developing countries in South Asia; Bangladesh and Sri Lanka. A threefold analysis was conducted to investigate the evolution of the COVID-19 pandemic in two countries, the impact of the pandemic on external and internal public finance and the effect of the pandemic in shifting the policy priorities from SDGs to economic survival. This study found that both countries are highly vulnerable to the COVID-19 pandemic and are suffering from the lack of financing from external sources through the private sector as well as an increasing foreign debt. There is mounting pressure on the fiscal balance in both countries. © 2022, The Author(s).

Determining the financial performance of non-life insurers : Static and dynamic panel evidence from an emerging economy.

- Barua, Bipasha, Barua, Suborna, Hasan Rana, Rezwanul

  • Authors: Barua, Bipasha , Barua, Suborna , Hasan Rana, Rezwanul
  • Date: 2018
  • Type: Text , Journal article
  • Relation: The Journal of Developing Areas Vol. 52, no. 3 (2018), p. 153-168
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  • Description: Non-life insurance companies are an important part of the financial system in any country. Constant development and financial sustainability of these institutions is key to foster the rapidly growing economic activities of emerging economies like Bangladesh. This study made an attempt to establish the impact of different firm-specific factors on profitability using the non-life insurance sector in Bangladesh. A thriving insurance industry, especially in the non-life sector, can accelerate economic growth by mobilizing large funds and providing risk-hedging services to economic activities. This paper investigates the temporary and permanent impact of different firm-specific factors on financial performance, using the case of the non-life insurance sector in Bangladesh: one of the fastest growing economies in the world. Using panel data on 16 non-life insurance companies from 1999 to 2014, this paper utilizes both Static Panel Data (SPD) and Dynamic Panel Data (DPD) estimation techniques. For DPD estimation, a Pooled Mean Group (PMG) estimator built on an ARDL Framework that can produce short run and long run impacts separately has been employed. In addition to the average impact generated from static estimations, this paper identifies the significant impact of all variables on profitability in the long-term (those of a permanent nature) while the investment ratio shows some impact in the short-term (those of a temporary nature). The results of the study indicate that the average impact is predominantly derived from the long-term and thus appear to be permanent in nature. Moreover, investment ratio contributes positively to profitability, mostly in the short-term (temporarily) with some effects in the long-term. The findings on liquidity and investment ratio suggest the permanent nature of their impact on profitability in the long-term and, hence, insurers are probably better served investing funds in short-term opportunities (e.g. investing in securities) rather than in long-term ones. Lastly, the empirical results regarding the impact of leverage is not clear, as it shows mixed impact in two different estimations, including the permanent nature of negative impact in the long-term. The non-life insurance companies of Bangladesh should implement strong policies to reduce the faulty underwriting procedures to improve the profitability. This paper offers significant contributions to the literature by separately identifying the 'temporary' and 'permanent' impact of several determinants, thereby producing novel estimations for Bangladesh that may have implications for other emerging economies.

Economic climate, infrastructure and FDI : Global evidence with new dimensions

- Barua, Suborna, Naym, Junnatum, Hazera-Tun-Nessa

  • Authors: Barua, Suborna , Naym, Junnatum , Hazera-Tun-Nessa
  • Date: 2017
  • Type: Text , Journal article
  • Relation: International Journal of Business and Economics Vol. 16, no. 1 (2017), p. 31-48
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  • Description: This study revisits how infrastructure and economic environment affect FDI inflow. Using static and dynamic estimations on 81 countries from 1995 to 2013, the study finds electricity availability having the strongest positive impact alongside Economic Freedom and GDP. However, urban population and unemployment shows negative impact. This study suggests for urbanization with lower cost of living and developed infrastructure to attract more FDI.

Financial development and economic growth : Evidence from a panel study on South Asian countries

- Hasan Rana, Rezwanul, Barua, Suborna

  • Authors: Hasan Rana, Rezwanul , Barua, Suborna
  • Date: 2015
  • Type: Text , Journal article
  • Relation: Asian Economic and Financial Review Vol. 5, no. 10 (2015), p. 1159-1173
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  • Description: The paper examines the relationship between financial development and economic growth using panel data for five emerging South Asian countries - Bangladesh, India, Nepal, Pakistan and Sri Lanka. The heterogeneous panel data is collected from the World Bank for the period of 1974 to 2012. Economic Growth is represented by GDP growth rate, and for Financial Development, five major variables have been used: (i) Domestic Credit Provided by Financial Sector, (ii) Total Debt Services, (iii) Gross Domestic Savings, (iv) Broad Money, and (v) Trade Balance. Fixed Effect Panel regression model has been used and Time Fixed Effect, Cross Sectional Dependence, Heteroskedasticity, Serial Correlation and Cointegration have been tested for model fitness. The results indicate that growth of total debt services and domestic savings have significant impact on economic development of these countries. Interestingly, broad money, trade balance and domestic credit have no considerable influence on fostering economic growth which is generally unexpected. The paper places several arguments to explain these results. The study appears to be a first hand examination on the South Asian countries and adds new insight into the existing literature. The findings and discussions presented would be valuable in designing long term financial and macroeconomic policies by these countries.

Financing sustainable development goals : A review of challenges and mitigation strategies

- Barua, Suborna

  • Authors: Barua, Suborna
  • Date: 2020
  • Type: Text , Journal article , Review
  • Relation: Business Strategy and Development Vol. 3, no. 3 (2020), p. 277-293
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  • Description: Sustainable development goal (SDG) implementation is still at an early stage globally. Implementation of the SDGs in developing countries particularly appears very complex and challenging. A key challenge encountered by policymakers at the national and international levels is the prevailing huge financing gap. The current level of SDG-related financing and investing is far less than what is needed, and there is a growing concern on how to close this gap. This paper explores the key challenges in SDG financing and potential way-out to mitigate them, particularly in the context of developing countries. The paper reviews the existing literature and practitioner documents, identifies the key challenges, and provides a suggestive mapping of potential strategies to overcome those. The paper argues that given the current level of SDG progress and financing, the world needs immediate action to mobilize adequate financing to achieve the SDGs by the set time line of 2030.

International trade financing : A comparative study on the performance of state-owned and private commercial banks of Bangladesh

- Akter, Hazera, Barua, Suborna

  • Authors: Akter, Hazera , Barua, Suborna
  • Date: 2014
  • Type: Text , Conference paper
  • Relation: International Conference on Interdisciplinary Business and Economics Research p. 164-186
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  • Description: We investigate the comparative performance of state-owned commercial banks (SOCBs) and private commercial banks (PCBs) of Bangladesh with respect to efficiency and profitability in financing international trade. Taking a ten-year panel data over 2003-2012 of all four SOCBs and four categorised PCBs, we apply the non-parametric approach data envelopment analysis (DEA) to measure and compare efficiency of the banks using output-oriented Malmquist Productivity Indices (MPI). Furthermore, we develop some specialised profitability ratios on trade financing business of the banks to measure profitability. Our results suggest that PCBs are more efficient and profitable compared to SOCBs' although PCBs provide less trade financing than SOCBs'. The study recommends SOCBs to progress technologically for sustaining themselves in the competitive banking sector of Bangladesh. Moreover, we identify the sources of profitability that would explain the banks' strategic position in trade financing business which would motivate more banks to support international traders through trade financing.

Internationalization and performance : Evidence from Bangladeshi banks

- Barua, Suborna, Khan, Tasneema, Barua, Bipasha

  • Authors: Barua, Suborna , Khan, Tasneema , Barua, Bipasha
  • Date: 2017
  • Type: Text , Journal article
  • Relation: The Journal of Developing Areas Vol. 51, no. 2 (2017), p. 105-118
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  • Description: Internationalization of banking institutions has been more evident to a greater extent recently due to the advancement of technology and global inter-connectedness of the business world. As the "engine of economic growth" banks are the dominant players in Bangladesh financial market. Due to quick market saturation, highly competitive domestic market and need for innovation, banks in Bangladesh are tending to move towards international market. Using six financial performance measures and five internationalization variables, this paper examines the impact of different internationalization dimensions on financial performance of the banks. The study estimates 18 models on panel data of 35 scheduled banks for 2005 to 2014 using Dricoll-Kraay, Prais-Winsten alongside Fixed and Random Effect estimation techniques. Findings suggest that net effect of internationalization is on average negative for all banks however it is significantly negative for the SOBs compared to PCBs. The paper also finds that physical presence in foreign countries, level of internationalization banks place themselves and age of international operation have significant impact on most of the performance measures. This paper contributes to existing literatures by: using new dimensions to define internationalization, examining impact on six different performance measures, being the first study on internationalization of Bangladeshi banks, and generating some unique findings.

Sustainable financing practices through green bonds : What affects the funding size?

- Barua, Suborna, Chiesa, Micol

  • Authors: Barua, Suborna , Chiesa, Micol
  • Date: 2019
  • Type: Text , Journal article
  • Relation: Business Strategy and the Environment Vol. 28, no. 6 (2019), p. 1131-1147
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  • Description: Financing through the supply-driven green bonds market has significantly surged in recent years. In this paper, we examine the factors influencing the size of financing though green bond supply, using cross-section OLS regressions on a global dataset for 8 years (2010–2017) sourced from Bloomberg. We consider a set of tridimensional factors: bond characteristics, issuer characteristics, and market characteristics and examine their effects on issue size. Alongside whole sample estimation, we produce year-wise estimations to realize the evolution and persistence of the effects over time. We then produce estimates across rating grades of the bonds. Finally, we carry Blinder–Oaxaca decomposition to see if average issue size has significantly changed over time and whether the factors considered can explain the difference. We find a large number of factors affecting issue size asymmetrically; however, many of the effects do not persist over time and are heterogeneous across rating grades. In contrast to the aggregate market trend, we find no evidence of increases in average issue size in the recent year. Furthermore, the average financing size is found significantly lower for high-grade bonds. The paper provides a basis for encouraging green bond supply, particularly considering the rating of the bonds and the issuers.

The design and adoption of green banking framework for environment protection : Lessons from Bangladesh

- Rahman, S. M. Mahfuzur, Barua, Suborna

  • Authors: Rahman, S. M. Mahfuzur , Barua, Suborna
  • Date: 2016
  • Type: Text , Journal article
  • Relation: Australian Journal of Sustainable Business and Society Vol. 2, no. 1 (2016), p. 1-19
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  • Description: Bangladesh Bank, the central bank of Bangladesh and a forerunner in pursuing environment-friendly banking, designed a structured three-phase Green Banking Guideline and instructed the scheduled banks to implement it by 2013. This paper aims to present a comprehensive picture about where the country stands in terms of adopting green banking practices. Examining 42 of total 54 scheduled banks of Bangladesh, the study finds that most banks are trapped in the lower boundaries of the performance greed. The state owned banks rank low in performance while the foreign banks have considerably better achievements. The paper also identifies a number of reasons for the banks' poor performance and proposes corrective measures. The lessons may be useful for redesigning banking practices around the world to save environment.

The drivers of economic growth in South Asia : Evidence from a dynamic system GMM approach

- Rahman, Mohammad, Rana, Rezwanul, Barua, Suborna

  • Authors: Rahman, Mohammad , Rana, Rezwanul , Barua, Suborna
  • Date: 2019
  • Type: Text , Journal article
  • Relation: Journal of Economic Studies Vol. 46, no. 3 (2019), p. 564-577
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  • Description: Purpose: The purpose of this paper is to explore the drivers of economic growth in South Asia region for the period of 1975–2016 using the World Bank data. Design/methodology/approach: Panel corrected standard error (static estimation) approach and one-step system generalised method of moments (dynamic estimation) approach are used. Findings: Both the static and dynamic estimations indicate that energy use, gross capital formation and remittances are the main drivers of economic growth in South Asian countries. The effects of all these variables are positive and significant. The extent of the effect of energy use is much higher than that of other two variables on the economic growth. A 1 per cent increase in the growth of energy consumption can expedite the gross domestic product growth by approximately 3 per cent in South Asia. However, the key variables, such as trade, government expenditure and foreign direct investment demonstrate no significant effect. Originality/value: The current research is original in the sense that it investigated the issue with a new data set using improved econometric techniques. Moreover, in South Asia as a whole, this kind of study is totally absent, particularly with panel data of a large number of years. Furthermore, this study has taken into account the problem of heterogeneity and the biases created by cross-section dependence, which were mostly absent in previous studies. Therefore, the findings of this research are new contributions to the existing literature.

The impacts of climate change on trade and foreign direct investment flows

- Barua, Suborna

  • Authors: Barua, Suborna
  • Date: 2019
  • Type: Text , Thesis , PhD
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  • Description: A growing body of climate economics research suggests that climate change affects production, prices, distribution structures, investments and national income. Studies further describe international trade and climate related investments as key activities in climate impact mitigation and adaptation. However, despite its increasing relevance, the empirical link between climate change and international trade and investment remains largely unexplored. This thesis investigates the climate change impacts on trade and foreign direct investment (FDI) flows using static and dynamic panel estimations covering 102 countries. The modelling uses temperature and precipitation variability to separately evaluate changes in international trade from 1962 to 2014, and in FDI inflows from 1995 to 2014. The trade impacts estimations consider exports of total merchandise, agriculture and six agricultural sectors; while controlling for income, comparative advantage, productivity, domestic and trade policies, and climate zones. The FDI impacts modelling evaluates total and sectoral inflows, while controlling for income, market size, infrastructure, openness, financial development, the global financial crisis and climate zones. Results show that climate change significantly affects both exports and FDI inflows. In particular, temperature affects merchandise exports, negatively at the global and developing country level, and positively in high-income countries. Agricultural exports are negatively affected by temperature. At the sectoral level, oil-seeds and dairy are mostly affected. Precipitation effects are limited and mostly negative for agriculture. The FDI world aggregate flows respond mostly positively to both temperature and precipitation, and static estimations indicate a FDI positive response in developing countries. Furthermore, FDI sectoral estimations indicate a differentiated response. Findings could inform the formulation of trade and investment policies, at the national and global level, in consideration to the differential impacts of climate change across sectors, regions and economic status. Furthermore, these estimates could be used in projections considering climate change as a determinant of trade and investment flows.
  • Description: Doctor of Philosophy

The microinsurance market in Bangladesh : An analytical overview

- Ahsan, Syed, Khalily, M. A. Baqui, Hamid, Syed, Barua, Shubhasish, Barua, Suborna

  • Authors: Ahsan, Syed , Khalily, M. A. Baqui , Hamid, Syed , Barua, Shubhasish , Barua, Suborna
  • Date: 2013
  • Type: Text , Journal article
  • Relation: The Bangladesh Development Studies Vol. 36, no. 1 (2013), p. 1-54
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  • Description: This paper provides an analytical overview of the current state of the microinsurance market in Bangladesh comprising of products offered by commercial insurance companies, microfinance institutions (MFIs) and those by INAFI’s MIME programme. For the commercial life insurers, available products are characterised by a mix of inadequate risk coverage, excessively high premium rates unrelated to any plausible model of mortality of the insured, lengthy process of claim settlement and, above all, high costs of intermediation. Such products therefore appear unattractive to the vulnerable. The MFIs, on the other hand, mainly offer loan insurance thus minimising lenders’ risks and having a much quicker claim settlement process. Some MFIs also offer a variety of other products (notably, term life, health and livestock insurance). However, the health plans reviewed in the paper clarify that most of these are not examples of true insurance products since the bulk of the risk eventually remains with the insured. The requirement of cash transactions in each step of the way is a further drawback eroding popularity of the products. Finally, it is seen that, while INAFI has been implementing both term and endowment life policies, the premium structure appears rather steep vis-à-vis the cost of risks, presumably reflecting high costs of intermediation. In view of very limited competition in the market for commercial life coverage, regulatory directives may be targeted at improving competition in each segment of the market, thereby fostering innovation and fair play.

The surge of impact borrowing : The magnitude and determinants of green bond supply and its heterogeneity across markets

- Chiesa, Micol, Barua, Suborna

  • Authors: Chiesa, Micol , Barua, Suborna
  • Date: 2019
  • Type: Text , Journal article
  • Relation: Journal of Sustainable Finance and Investment Vol. 9, no. 2 (2019), p. 138-161
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  • Description: Green bonds could play a key role in financing the investment needed to achieve the global climate and energy objectives and the UN Sustainable Development Goals. Using Bloomberg data of corporate green bond issuance from 2010 to 2017, we explore the factors affecting the size of borrowing. By employing a set of tri-dimensional elements (security characteristics, issuer characteristics, and market characteristics), we investigate the consistency of the effects across emerging and non-emerging markets. Findings suggest that, in general, issue size is positively related coupon rate, credit rating, collateral availability, and issuer’s sector and financial health. Moreover, issuances in emerging markets with a more international orientation and denominated in EURO, have a higher size. Arguably, these features make bonds more reliable, secured, and return-generating for investors, which facilitates higher issue size through greater investor demand. The paper calls for policies and incentives to encourage impact borrowing through increased green bond supply.
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