Name : Intisar Ahmed

Overview of Bangladesh Economy

Background
The economy of Bangladesh has maintained a solid track record so far regarding growth and
development, even during the times of augmented global uncertainty. Being the second largest
economy in South-Asia, the country has already secured its place as the 33rd largest economy in
the world in nominal terms, but 25 th in terms of the purchasing power parity of the mass people.
Copious High profile financial institutions in the world are considering Bangladesh as one of the
next eleven. Since its birth in 1971, Bangladesh has made a remarkable comeback by alleviating
poverty and generating development. One of the finest achievements was reaching the status of
lower-middle income country back in 2015 and it’s also on track to become graduated from
Least Developed Country by November 4, 2026. By this process of Economic policy implication
and growth plan, the country targets to bring it to the club of developed countries in the year
2041.The poverty rate has witnessed significant decline from 11.8% from 2010 to 5% in 2022
which is based on the international poverty line of $2.15 per day (According to the purchasing
power parity exchange rate).
The geographic location of Bangladesh has advantages in terms of strengthening bilateral or
multilateral trade with other economic emerging countries surrounding its border. Bangladesh
shares its borders with Myanmar and India. Three most significant ports out of 12 - Chattogram,
Mongla and Payra is maintained by Bangladesh for regional trade and connectivity. Having
geographic link with South-Asia and South-East Asia, Bangladesh has been included for any
regional integration among the giant trade blocs both of Association of South-East Asian Nations
(ASEAN) and South Asian Association for Regional Cooperation (SAARC).Therefore, the
region of Bangladesh can be considered as an eccentric hub for furthering regional coordination,
trade connectivity that can attract lucrative investments in infrastructure and communications.
Since the year FY17-18, the economy is witnessing a positive growth rate except the year 2020
when the whole world unexpectedly went through economic recession for life threatening Covid-
19 pandemic. Despite having a trivial growth rate of only 3.4% in the fiscal year 2020-
21,Bangladesh Economy bounced back in the fiscal year 2022-2023 through accelerating the
GDP growth rate towards 7.1% . Due to global inflationary pressure, energy shortages, Russia-
Ukraine war etc. Bangladesh is facing some economic pressure during the recent times, yet the
projected GDP Growth rate is 6% in FY 2023-24. GDP per capita growth rate was significantly
high since FY 2014-15 unless in 2020 when the world was hit by global pandemic and the
growth rate fell down to 2.3%.Yet the country made a comeback through effective policy
implications and brought back the per capita growth rate to 6%. The vision of achieving upper-
middle income status by 2031 has been addressed by the government seriously and the think
tanks of the country are dedicatedly working on significant issues such as employment creation,
generating a competitive business environment, increasing human capital and skilled labour
force as well as establishing a effective policy environment to attract private investment.
Priorities are being given towards diversifying exports from other important sectors let alone
RMG.
Identifying the volatilities prevailing in the financial sectors and resolving them is another key
challenge the country is working on.Above all, fiscal reforms,sustainable development and
actions towards climate change are some other major issues Bangladesh is working on to foster
the economic growth for the next generation.
GDP Growth Rate (%)

GDP Growth Rate of Bangladesh

10
7.3 7.9
8 6.5 6.6 7.1 6.6 6.9 7.1
6 6.1 6
6
4
2 3.4
0
2 3 4 5 6 7 8 9 0 1 2 3
2 01 2 01 2 01 2 01 2 01 2 01 2 01 2 01 2 02 2 02 2 02 2 02
FY FY FY FY FY FY FY FY FY FY FY FY

Year

Source : The World Bank

Inflation Rate of Bangladesh Over the Years

14
Inflation Rate (%)

12
10
8
6
4
2
0
1 1 21 21 2 2 22 22 3 3 23 23
02 02 20 20 02 02 20 20 02 02 20 20
,2 ay
,2 t, r, ,2 ,2 t, r, ,2 ay
,2 t, r,
ry us be ry ay us be ry us be
ua M g ua M g ua M g
br Au ve
m br Au ve
m br Au e m
e e e pt
F No F No F
Se

Time Period

General Inflation Food-Inflation Non-Food Inflation

Source : Trading Economics