World Bank lowers Bangladesh's economic growth projection
The World Bank has revised its economic growth projection for Bangladesh, now forecasting a growth rate of 5.6% for the current fiscal year. This adjustment marks a decrease from the earlier projection of 6.2% GDP growth for Bangladesh made in April of the same year.
This revised projection was disclosed in the October update of the Bangladesh Development report, a publication by the World Bank. The report's release was accompanied by a press briefing organized by the World Bank's Dhaka office.
The report highlights data from the Bangladesh Bank, indicating that the combined value of rescheduled loans, non-performing loans, and net written-off loans in the country has reached approximately Tk3,77.92 crore, equivalent to about $34.4 billion, or 9.5% of the Gross Domestic Product (GDP) for the fiscal year 2022.
The report also mentions the possibility of lingering inflation, contingent on fluctuations in both domestic and global commodity prices. Stabilizing the external sector is seen as dependent on addressing distortions in exchange rates and removing exchange rate ceilings.
Furthermore, the World Bank cites uncertainty related to the upcoming national elections as another factor contributing to the reduced economic growth projection.
The report also notes that the estimated fiscal deficit has expanded to 5.3% of GDP in fiscal year 2023, up from 4.6% of GDP in the previous fiscal year. This increase is attributed to higher growth in government expenditures compared to revenue growth.
It's worth mentioning that the Asian Development Bank (ADB) and the International Monetary Fund (IMF) have both offered more optimistic forecasts, projecting a growth rate of 6.50% for fiscal year 2024 in Bangladesh.
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