BSS, Dhaka :
Bangladesh would log a higher growth trajectory in five years provided the country facilitates huge investment with maintaining political and social stability, a World Bank (WB) economist said on Tuesday.
Zahid Hussain, the lead economist at the Bank’s Dhaka office, was speaking about the state and outlook of Bangladesh economy at the launching programme of the “Bangladesh Development Update” – a regular publication of the multi-donor agency.
WB country director Jonathan Zutt made the introductory remark on the occasion when lead economist Salman Zaidi and WB Communication Officer Mehrin A Mahbub were present at the programme at the WB country office in Dhaka.
Indirectly referring to the last national election, Hussain said economy had started recovering from prolonged disruption since January this year, aided by political and macroeconomic stability. He said Bangladesh proved that it could achieve over 6.0 percent growth when many other nations were struggling at lower level.
The economist in his PowerPoint presentation on the key points of the Update put together the progress and the development that the country made in the past five years; and expected that the changes and the progresses would shape Bangladesh to log a higher growth trajectory.
The WB already projected 6.2 percent growth for Bangladesh in the current 2014-15 financial year, saying it would be “satisfactory” considering the global economy, which showed slower pace in the recent months.
But, Hussain in his presentation highlighted the inner strength of the economy, based on the effective drive for poverty alleviation, job creation, income generation and increasing productivity, particularly in the agriculture sector.
It also appeared from his presentation that the most significant change the government brought in the past five years to upgrade the country to a middle-income group was the scaling up of the income of the bottom 40 percent of the population.
In the past five years, domestic employment, agriculture wages and per capita income rose significantly to take Bangladesh to the Medium Human Development (MHD) category from the lower scale at the latest Human Development Index (HDI) of the United Nations Development Programme (UNDP), Hussain noted.
The economist, however, tagged the prospect of the higher growth with massive investment, which would only be possible after successfully implementing some major projects to facilitate large-scale investment, required to propel growth.
He said the government in the last national budget projected 7.2 percent GDP growth in the end of the current financial year with 28 percent growth in investment.
“The country needs 33-35 percent growth in investment to get rid of the 6.0 percent growth cycle,” Hussain said, adding: “An investment boom is required to accelerate investment growth in the coming years”.
He said the investment showed nearly 1.0 percent growth in the recent years, which was normal, but the growth would be much higher in the coming years should the government prioritized completion of at least four areas as identified in the WB’s latest Update.
The four areas include garment sector, road infrastructure, Public Private Partnership (PPP) and Special Economic Zones (SEZs).
“Moving forward in the immediate future, stronger attention is needed to swiftly complete the transition in the garment industry, finish the critical ongoing road development projects, enact the Public Private Partnership (PPP) law, and award contracts to build Special Economic Zones (SEZs)”, the Update said.
At the same time, it suggested that the quality of public investment should be substantially enhanced to alleviate the infrastructure constraints on private investments and to expand service delivery.
WB research analyst Nadeem Rizwan, who co- authored the Update with Hussain, added that the government should take effective measures to fulfill the compliance issues in the garment sector.
