Economic Condition of Bangladesh

Topics: Tax, Economic growth, Gross domestic product Pages: 13 (3619 words) Published: April 29, 2014
Bangladesh has made remarkable progress in macroeconomic management. Acceleration of economic growth, gradual decline of budget deficit, high rate of export and import growth, steady rise of foreign currency reserve at a satisfactory level are some of the major achievements that Bangladesh attained during the past few years until FY2007-2008. Success in achieving these significant milestones is largely attributable to a set of policies and reforms implemented in order to attain macroeconomic stability accompanied by acceleration of economic growth. With continued economic growth Bangladesh Economy has established itself on solid foundation.

Macro- economic condition of Bangladesh (FY 2012-2013)

Source: Published in The Independent (CPD fears fall in real GDP growth), Bangladesh Bureau of Statistics, Bangladesh Bank

Macro- economic condition of Bangladesh (FY 2011-2012)

Macro- economic condition of Bangladesh (FY 2010-2011)

Macro- economic condition of Bangladesh (FY 2009-2010)

Macro- economic condition of Bangladesh (FY 2008-2009):

Trend analysis of GDP of Bangladesh (2009-2014)

During last five years continued growth has led to attainment of GDP growth above 6%. Despite global economic recession during 2008-2009, Bangladesh managed its economy remarkably well and maintained its growth momentum. Against the backdrop of several limitations, the biggest challenge of the country is to maintain high performing growth through increasing production, minimizing human poverty through enhancing creativity and human capacity, stabilizing commodity prices. There was an increment of $62 in the per capita GDP in FY2009 from US$559 at the end of FY2008. Fiscal 2009 registered per capita income of US$676. About 25% of the country’s GDP in 2009 came from remittances of expatriates, totaling $9.7 billion and garment exports worth $12.3 billion. The country has registered significant expansion in its middle class. The consumer industry has grown considerably. The increasing foreign direct investment highlights the growth rate of the Bangladesh economy. Over time there has been structural transformation of the economy with a shift from predominantly agricultural led economy towards industry led economy, the contribution of agriculture sector to GDP was 38% in early 70’s but decline to 20% in 2009-2010, while the contribution of industrial sector increase from 15% to 30% of GDP during the same period of time. The growth of the economy in year 2009-2010 are mainly attributed by the high growth in industry, rapid growth in export and strong inward remittances, reforms in financial sector, sound monetary and fiscal policy and it was able to manage GDP 6.07 from 5.74 in the previous year.

In the year 2011 the GDP of Bangladesh attained the highest GDP in Bangladesh history which was 6.71. According to the finance ministry it was possible for the proper monetary policy and also subject to favorable weather conditions for agriculture, robust growth in export and urgent sustainable increase in power and gas supplies.

In the other hand in 2012 the GDP decelerated into 6.32 but still the economic condition seems in a better position due to the remittance inflows which were three and a half times higher than that of the previous four fiscal years. As of November 2012, 6.11 billion US dollar had been received and in October 2012, the foreign exchange reserves surpassed the country’s history for the first time by crossing over 12 billion dollar reaching 12.70 billion on December 23, 2012 recording an increase of more than 400 percent.

The economic growth slowdown to 6.01 per cent in the last fiscal from 6.32 per cent of the 2011-12 fiscal, and was off-track compared to the ambitious target of 7.2 per cent. This is because Bangladesh tends to experience significant violence during periods of political transition. The economic growth prospect remains circumscribed because of depressed private...
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