Bangladesh’s GDP growth to scale 8% in FY19, says ADB

Special Correspondent
Bangladesh’s GDP growth is set to hit 8 percent at the end of current fiscal based on the continuing positive trend in exports and public investments, the Asian Development Bank, or ADB, has said.
The ADB makes the prediction in its annual publication titled ‘Asian Development Outlook 2019’, or ADO 2019, after analysing the state of the Bangladeshi economy.
Asian Development Bank’s Country Director for Bangladesh Manmohan speaks at a media conference marking the launch of the bank’s flagship publication, ‘Asian Development Outlook 2019’ in its Dhaka office. Photo: Asif Mahmud Ove
Manmohan Parkash, the ADB’s country director for Bangladesh, highlighted various aspects of the report at a media briefing in the institution’s Dhaka office.
According to the report, the GDP of Bangladesh is expected to grow by 8 percent in 2019-2020 with robust private consumption, increased public investment, strong export performance, and expansion in industries.
Asian Development Bank’s senior economist Soon Chan Hong speaks at a media conference marking the launch of the bank’s flagship publication, ‘Asian Development Outlook 2019’ in its Dhaka office. Photo: Asif Mahmud Ove.
“To sustain this momentum in the medium to long-term, Bangladesh requires expanded industrial base, diversified export basket, improved business environment for vibrant private sector development, expanded tax base, better revenue collection for increased resource allocation, and human capital development,” said Manmohan Parkash.
“Continued focus on prudent macroeconomic policies, sound debt management, strengthening the banking sector, removing infrastructure constraints, and reducing the cost of doing business are important to help achieve the long-term development vision of the country.”
Though the ADB predicts a slightly lower rate of GDP growth than the government, the figure is higher than the lender’s previous projections.
After analysing the data for the first eight months of the current fiscal year (July-February), the Bangladesh Bureau of Statistics estimated a record economic growth of 8.13 percent at the end of the fiscal year 2018-2019.
Bangladesh’s GDP growth was 7.86 percent in the past fiscal year while the per capita income was $1,751.
Bangladesh’s economic growth crossed 7 percent in fiscal 2015-2016 after almost a decade in the region of 6 percen.
Asia to lose momentum
Growth in developing Asia could slow for a second straight year in 2019 and lose further momentum in 2020, the Asian Development Bank (ADB) said on Wednesday, warning of rising economic risks from a bitter Sino-US trade war and a potentially disorderly Brexit.
Developing Asia, which groups 45 countries in the Asia-Pacific region, is expected to grow 5.7 this year, the ADB said in its Asian Development Outlook report, slowing from a projected 5.9 percent expansion in 2018 and 6.2 percent growth in 2017.
The 2019 forecast represents a slight downgrade from its December forecast of 5.8 percent. For 2020, the region is forecast to grow 5.6 percent, which would be the slowest since 2001. “A drawn out or deteriorating trade conflict between the People’s Republic of China and the United States could undermine investment and growth in developing Asia”, Yasuyuki Sawada, ADB’s chief economist, said in a statement.
The lender also cited uncertainties stemming from US fiscal policy and a possible disorderly Brexit as risks to its outlook because they could slow growth in advanced economies and cloud the outlook for the world’s second largest economy. “Though abrupt increases in US interest rates appear to have ceased for the time being, policy makers must remain vigilant in these uncertain times,” Sawada said.
China’s economy will probably grow 6.3 percent this year, the ADB said, unchanged from its  December projection, but slower than the country’s 6.6 percent expansion in 2018. Growth in the Chinese mainland is projected to cool further to 6.1 percent in 2020. China has set its 2019 economic growth target at 6.0 to 6.5 percent.
By region, South Asia will remain the fastest growing in Asia Pacific, with the ADB predicting an expansion of 6.8 percent this year – lower than its previous forecast of 7.1 percent – and 6.9 percent next year.
From an estimated 7.0 percent growth in 2018, India’s economy is projected to expand at a faster pace of 7.2 percent in 2019 and 7.3 percent in 2020, the ADB said, as lower policy rates and income support to farmers boost domestic demand.
This year’s growth forecast for Southeast Asia was trimmed to 4.9 percent from an earlier estimate of 5.1 percent, as the Manila-based lender expect Malaysia, Singapore, Philippines and Thailand to grow slower than previously thought. Next year, Southeast Asia is predicted to grow 5.0 percent.
Citing stable commodity prices, the ADB lowered its average inflation forecast for developing Asia to 2.5 percent this year from 2.7 percent previously, and it is expected to remain subdued at 2.5 percent in 2020.

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