Bangladesh and Nepal are estimated to grow faster than India in 2019, according to the World Bank (WB), which said the overall growth in South Asia may slow down this fiscal to 5.9 per cent, down 1.1 percentage points from April 2019 estimates. Bangladesh’s economy sustained a strong growth in fiscal 2018-19 led by rising exports and record remittances.
Pakistan's growth rate is projected to deteriorate further to a mere 2.4 per cent this fiscal, as monetary policy remains tight, and the planned fiscal consolidation will compress domestic demand, the agency said.Bangladesh and Nepal are estimated to grow faster than India in 2019, according to the World Bank (WB), which said the overall growth in South Asia may slow down this fiscal to 5.9 per cent, down 1.1 percentage points from April 2019 estimates. Bangladesh's economy sustained a strong growth in fiscal 2018-19 led by rising exports and record remittances.#
Remittances in Bangladesh grew by 9.8 per cent, reaching a record $16.4 billion in 2018-19 and the contribution of net export growth was positive, supported by a diversion of garment export orders from China and a decline in imports, said a new World Bank report, titled ‘Bangladesh Development Update October 2019: Tertiary Education and Job Skills’. However, leather and leather product exports in the country declined by 6 per cent.
Net foreign direct investment (FDI) in Bangladesh increased by 42.9 per cent from a low baseline with investments in the power, food and textile sectors. Private consumption grew by 5.4 per cent. Private sector credit growth was weak and bank liquidity remains constrained. Non-performing loans continued to rise in the banking sector.
The World Bank report warns about an uncertain global outlook and domestic risks in the financial sector. Exchange rate appreciation is also a challenge for Bangladesh’s trade competitiveness. Reforms in the financial sector, including revenue mobilization and doing business, will be essential for progress. The report also urges closing the infrastructure gap and timely implementation of the Annual Development Plan.
“Bangladesh’s economy is projected to maintain strong growth backed by sound macroeconomic fundamentals and progress in structural reforms,” said Mercy Miyang Tembon, World Bank Country Director for Bangladesh and Bhutan.
“To achieve its growth vision, Bangladesh will need a high-productivity economy. Human capital development that is responsive to labor market demand for higher-level skills and to rapid technological advancements will be crucial,” she said.
Tertiary graduates struggle to find jobs, indicating a major skills gap. Only 19 percent of college graduates are employed full-time or part-time. At the tertiary level, more than a third of graduates remain unemployed one or two years after graduation, while unemployment rates of female graduates are even higher.
“Labor market surveys repeatedly show that employers struggle to fill high-skill positions such as technicians and managers,” said Bernard Haven, World Bank Senior Economist, and co-author of the report.
“To bridge the demand and supply gap, investments in skills training, equitable access for female and poor students, public funding mechanisms to develop market-relevant skills and an effective regulatory and accountability framework are needed,” he said.
Fibre2Fashion News Desk (DS)
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