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Bangladesh to see 3.6% GDP growth this year: World Bank

Published : Wednesday, 9 June, 2021 at 9:36 PM  Count : 5598

Bangladesh to see 3.6% GDP growth this year: World Bank

Bangladesh to see 3.6% GDP growth this year: World Bank


The World Bank has forecasted that Bangladesh's gross domestic product (GDP) will grow by 3.6% this fiscal of 2021-22, instead of its earlier forecast of 1.6%.

The global lender, in its flagship publication 'Global Economic Prospects', also said on Wednesday that Bangladesh's economic growth will be 5.1% in the fiscal of 2021-22, higher than the earlier growth forecast of 3.4%.
However, the World Bank's forecast was refuted by Finance Minister AHM Mustafa Kamal.

"Bangladesh's economic growth will surpass their projections," he said while speaking to reporters after attending a meeting of the Cabinet Committee on Public Purchase on Wednesday.

Private consumption is the main engine of growth which is supported by normalising activity, moderate inflation, and rising ready-made garment exports.

While there is uncertainty regarding the stability of private consumption, Bangladesh's growth is expected to experience a gradual recovery.

"Recoveries in Bangladesh and Pakistan face newheadwinds from a recent rise in Covid-19 casesaccompanied by rising restrictions to stamp outthe new surge," stated the report.

The report also highlighted the poor performance of vaccine administration in Bangladesh with only a small fraction of people having been vaccinated.

Contrary to the World Bank's projection, the Asian Development Bank (ADB) and the International Monetary Fund (IMF) had higher growth projection rates for Bangladesh for FY22, 7.2% and 7.5% respectively.

In the national budget for FY22, the government's GDP growth target is 7.2%. The 8th five-year plan also targeted 7.7% GDP growth in FY22.

The Asian Development Bank (ADB) and the International Monetary Fund (IMF) projected 6.8% and 5% growth for Bangladesh in the current fiscal.

The ADB and IMF's growth projection for FY22 is 7.2% and 7.5%, which is also higher than that of the WB's growth projections in the next fiscal year.

In the budget of FY 2021-22, the government's GDP growth target is 7.2%. The 8th five-year plan also targeted 7.7% GDP growth in FY 2021-22.

South Asia'srecovery remains fragile

South Asian economies arebouncing back as economic growth is set to increase by 6.8%this year after contracting an estimated 5.4% in 2020.

But the recovery remains fragile amid the Covid-19 pandemic. The region is expected to see tens of millions more extreme poor--those living below $1.90per day--by the end of this year and to have more than half of the new global poor created by Covid-19.

The report emphasised the uncertainty of the economic recovery stating, "All regions remain vulnerable to renewed outbreaks of Covid-19, which could feature variant strains of the virus; financial stress amplified by elevated debt levels; deeper-than-expected scarring from the pandemic; and rising social unrest, potentially triggered by rising food price"

India- the largest economy is South Asia is expected to grow 7.5% in the fiscal year 2021-22 (April to March), a decline from the revised growth projection of 8.3% in FY21after contracting by 7.3% in FY20.

"India's recovery is being hampered by the largest outbreak of any country since the beginning of the pandemic", stated the report.

The Maldives's real GDP is projected to grow by 11.5% inFY2022after projected to expandby 17.1% in 2021.

Sri Lanka and Pakistan's economy is expected to grow by 2% in FY2022 from the previous year's growth projection of 3.4% and 1.3% respectively.

Nepal's GDP is forecasted to grow by 3.9% in the fiscal year 2021-22(mid-July to mid-July).

In Afghanistan, 2.6% growth is expected in 2022 (December to December) compared to previous year's growth projection of 1%.

However, Bhutan's GDP will rise by 5% in FY22 (July-June)after a projected contractionin FY21.

World Bank President David Malpass said, "How national governments, the private sector, and international institutions respond to the challenges of poverty, inequality, and climate change as we emerge from a crisis that has affected us all will be defining choices of our age."
 
SZA






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