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Private Sector Outlook

Country Outlook

Bangladesh,as a country, precisely abridges the key attributes of the emerging South Asianmarkets and ranks among the fastest growing markets of South East Asia.According to global experts, Bangladesh is poised to become a middle incomecountry by 2021; at present, the country fares well with a USD 220 Billioneconomy, 159.9 Million population  ofwhich 50% are less than 25 years, a thriving middle income segment and a stableGDP growth of above 5% over the last decade. Bangladesh's growth has been resilientduring the 2008-09 global financial crisis and recent global recession. Thecountry aspires to become the regional manufacturing hub with a pool ofcompetitive labour.

Bangladeshhas achieved Ba3 (Moody's) stable rating for consecutive years (2010-13), andBangladesh's country rating by Moody’s is currently higher than that of SriLanka (B1). The current macroeconomic situation in the country is characterizedby a manageable fiscal deficit and low current account deficit. The stablemacroeconomic situation is an outcome of a mixture of prudent monetary andfiscal policies that are being pursued. The external current account deficithas also been low. This reflects the country’s continued high growth inexports, increased flows of remittances and moderate growth in money supply.

Bangladesh Economy: at a glimpse

As per the Bangladesh Bureau of Statistics, GDPgrowth rate has reached 7.05%. For the first time, Bangladesh has achieved thisgrowth rate with a vision to stable on it. Bangladesh's Ba3 rating reflectsstable and strong growth performance and modest debt burden- Moody's

GDP total:
 

BDT 17295.7 Billion (at current market prices 2015-16)
 

GDP per capita:
 

BDT 108172 (at current market prices 2015-16)
 

GDP growth rate (%):
 

7.05                          (at current market prices 2015-16)

Total exports:
 

BDT 1675.4 Billion (2015-16)
 

Total imports:
 

BDT 1990.5 Billion (2015-16)
 

Foreign exchange reserves:

USD 29.131 Billion (2015-16)

Source: Bangladesh Economic Review 2016

Bangladesh: Trends of Major Macroeconomic and Social Indicators

 Table01: Trends of major macroeconomic and social indicators

Indicators

FY 09-10

FY 10-11

FY 11-12

FY 12-13

FY 13-14

FY 14-15

FY 15-16

Population (Million)

147.8

149.7

151.6

153.7

155.8

157.9

159.9

Income (GNI per capita in US Dollar)

685

777

884

991

1096

1219

1374

Foreign Exchange Reserves (Million US Dollar)

10750

10912

10364

15315

21558

25025

29131

Source: Bangladesh Economic Review 2016

 

Bangladesh Yesterday

Bangladesh Today and Tomorrow
  • Henry Kissinger famously dubbed the country a 'basket case' at its birth in 1971
     
  • Heavily dependent on imported food
     
  • Highly vulnerable to national disasters and external shocks
     
  • 85% of the development budget is from Foreign Aid
     
  • Jute, tea and shrimp were the main sources of export earnings
     
  • Total export earnings USD 0.4 Billion
     
  • Population 71.5 Million (1974)
     
  • Labour force participation rate by gender (%)
    National 43.8%
    Male 80.4%
    Female 4.1%

 

 


 

 

 
  • Kissinger's 'Basket Case' Bangladesh Targets 8% Growth – Bloomberg
     
  • Bangladesh has maintained an impressive track record of growth and development. In the past decade, the economy has grown at nearly 6% per year, and human development went hand-in-hand with economic growth. Poverty dropped by nearly a third, coupled with increased life expectancy, literacy, and per capita food intake. More than 15 Million Bangladeshis have moved out of poverty since 1992. - World Bank
     
  • Bangladesh is now self sufficient in food
     
  • Only 0.3% of the GDP is now from the foreign donation - Bangladesh Economic Review 2016
     
  • Second largest exporter of RMG in the world - World Trade Organization, January 2013
     
  • ‘Bangladesh is drawing companies such as General Electric Co. (GE) and International Business Machines Corp’-Bloomberg
     
  • Labour participation rate by gender (%)
    National 57.1%
    Male 81.7%
    Female 33.5%
    - Bangladesh Bureau of Statistics 2013
  • “Bangladesh is an unsung hero,” Atiur Rahman said in a report of Bloomberg on April 18, 2011. “If we could get some additional help in terms of infrastructure development and connectivity, we will do far better. We are in a buoyant mood.”

Private Sector Outlook

Bangladesh:a country with a vibrant private sector

The export-oriented industries,in particular ready-made garments, propelled the manufacturing sector to newheights, with a vibrant private sector taking advantage of the low unit labourcosts to expand into new markets. Finally, the service sector has gainedmomentum from relatively strong domestic demand, bolstered by remittances andnew policy initiatives allowing more private participation and increasedcompetition. "Things look positive for Bangladesh" according toNaoyuki Shinohara, Deputy Managing Director of IMF.

The privatesector turns the wheel of economic activities of the country, aided by aliberal export oriented economic policy. Bangladesh has gradually transformedherself into an assembling and manufacturing heart, seeking for rapid expansionof the service sector. Private investment in FY 2015-16 stands at BDT 3767.5 Billioncompared to public investment of BDT 1313.8 Billion in the same year. Theprivate sector component as a percentage of GDP has increased from 16.8% fromthe FY2001-02 to 21.8 % in the FY 2015-16.

Table 03: Gross Domestic Product(GDP), Investment and Savings (BDT Billion)

Item/Sectors

FY 09-10

FY 10-11

FY 11-12

FY 12-13

FY 13-14

FY 14-15

FY 15-16

GDP (at current market prices)

7975.4

9158.3

10552.0

11989.2

13436.7

15158.0

17295.7

Gross Investment (at current prices)

(i)        Public

 

(ii)       Private

2093.3

372.8

 

1720.5

2511.3

481.5

2029.8

2982.3

608.0

2374.2

3403.7

796.2

2607.5

3839.9

879.9

2960.0

8478.7

1034.0

3344.7

5081.3

1313.8

3767.5

Gross Domestic Savings

1665.1

1897.6

2239.5

2642.0

2968.2

3358.8

4132.3

Agriculture and Forestry

1109.9

1254.7

1388.8

1487.6

1639.7

1765.0

1892.7*

Manufacturing

(a) Large and Medium Scale

(b) Small Scale

1285.7

 

1016.2

 

269.5

1465.0

 

1164.5

 

300.4

1679.2

 

1344.0

 

335.3

1971.3

 

1584.5

 

386.8

2232.2

 

1803.8

 

428.0

 

 

2544.8

 

2060.0

 

484.9

2922.8

 

2384.0

 

538.9

Services

(i) Wholesale & retail trade

(ii) Hotel & restaurants

(ii) Financial intermediary

(iv) Real estate, renting & business activities

(v) Education

 

 

1066.1

 

70.28

 

234.5

 

 

544.3

 

182.6

 

 

1213.3

 

82.3

 

275.5

 

 

601.2

 

213.9

 

 

1374.0

 

97.6

 

363.2

 

 

687.2

 

250.5

 

 

1545.8

 

112.6

 

422.4

 

 

788.2

 

284.3

 

 

1725.8

 

130.4

 

485.6

 

 

912.3

 

327.7

 

 

1925.9

 

149.3

 

557.6

 

 

106.1

 

376.2

 

 

2144.1

 

170.61

 

628.8

 

 

124.0

 

451.3

Source:Bangladesh EconomicReview 2016 * Temporary