Overview of the Bangladesh Economy in 2009
Ashek Ishtiak Haq
MBA 41-IBA, BBA 7th-DUPhone: 01720594959Address: 31st Siddeswari Lane, Dhaka-1217http://www.facebook.com/ashek.haq Bangladesh has remained an exemplary economy in the face of the global financial crisis. It hasproved to be decoupled from its effect. The economy not only registered
a 5.9% GDP growthperformance but also recorded stellar performance of the agriculture sector, posted buoyantremittance flow and ended with historically highest record level of forex reserves. Resilience is infact something that defines Bangladesh. Although, the country gets hit by mammoth naturaldisasters almost every year, its per capita income has advanced to a level of USD700 (frombelow USD200 in 1972) with major chunk of the achievement made since the opening up of theeconomy in 1991. The central bank is predicting that by 2013 the country will achieve the statusof middle-income country. The annual GDP growth rate during this period ranged between 5% to6.5%. The food production has tripled to a very impressive figure of 30 mn tonnes in 2008 froma meager 10 mn tonnes in 1972. The country has also made impressive progress in socialindicators such as the infant mortality rate, access to healthy sanitation facility, primary schoolenrollment, literacy rate, and life expectancy. In April, Moody’s and S&P assigned their first-eversovereign ratings to Bangladesh, which is three-level below the investment grade at a similarlevel to the Philippines, Indonesia, and Vietnam, and well above the ratings for Pakistan and SriLanka. Favorably the new ratings should help to ease the cost of capital, encourage more FDI,and reduce import and export costs (as the price of LCs should now fall).However, the year 2009 has presented the economy with some severe challenges such assignificant volatility in export earnings, deficiencies in power, gas, and basic infrastructure,decreasing job opportunities in the overseas market, inflationary trends gaining steam anddepressed investment trends.
The limited openness of the economy and strengthened domestic demand has helpedBangladesh to mitigate the most of the effect of the global recession.
Population (mn,Provisional) 144.20 Population growth1.26%Nominal GDP (USD bn) 89.38 Real GDP growth5.90%GDP, (USD bn, purchasing powerparity, est ) 242.40Inflation (12-monthsaverage)5.95%GDP per capita (USD; markerexchange rate ) 620.00Total investment % to GDPat current market price24.18%GDP per capita (USD; purchasingpower parity) 1,465.00Total consumption % toGDP at current marketprice79.98%Exports (USD bn) 15.60 Imports (USD bn)20.3Exchange rate (av) Tk:USD 69.11Forex reserves (March2010, USD bn)10.14
Bangladesh at a Glance (2008-09)
Source: Bangladesh Bank, IMF