May 14, 2021

Bangladesh is facing an election with great challenges in the economy

Bangladesh is facing an election with great challenges in the economy

After a decade of rule by the current prime minister, Sheikh Hasina, Bangladesh is heading towards a new era full of challenges with respect to economic development, poverty alleviation and the reduction of inequality.

The fragile Bangladeshi economy, based on livestock, agriculture and the textile industry, has tripled in the last decade its Gross Domestic Product (GDP), which in 2017 reached 249,724 million dollars, which is read by experts as a stabilization of one of the least developed countries in the world.

However, more than a fifth of the 163 million people in Bangladesh still live on the threshold of poverty, with a livelihood of one dollar a day, and another 35 million are struggling to overcome the poverty line.

"If we review the period from 2009 to 2018, in the last decade there have been tangible advances (…) but there are still many challenges that the next government will have to face and also many unfinished issues," Professor Mustafizur Rahman, a researcher at the Center for Political Agreement (CPD).

Rahman values ​​Hasina's achievements in terms of food security, energy security, improving infrastructure, macroeconomic stability and the exchange rate, and solid reserves.

At the same time, it warns that the future of this growth is subject to the political stability of the nation, and in this sense it underscores the need for political coexistence in the country as proof of an authentic democracy.

Hasina has so far achieved two continuous terms: the first with an overwhelming victory in 2008, and the second with an easy victory in 2014, after most opponents boycotted the elections by withdrawing from the race.

In this new battle, the opposition has denounced the indiscriminate repression and the persecution of supporters and leaders by the Government, awakening the concern of economists who warn that the agitation could lead the country back to instability.

"The kind of nation we need is a nation that is more inclusive than exclusive, I think this is where the government could have done it better," Rahman said.

Therefore, it is positive that in these elections the main parties are participating, unlike in 2014, but above all "the Government has the obligation to guarantee that there is a mainly inclusive society because the growing tension can undermine the future growth of Bangladesh", added .

According to Zahid Hussain, chief economist of the World Bank (WB) in Bangladesh, the next government must also regulate the country's banking sector, which kept fighting in the last two mandates of Hasina with capital shortages and the increase in delinquency. .

"The percentage of delinquent loans is almost 10%, so compliance must be guaranteed and political will was necessary for this," he said.

For Hussain "whoever comes to power, must face several immediate challenges (…), end megaprojects of urbanity, roads, energy, all are necessary for the national economy," he said.

It is also true that whoever assumes the reins of the Asian nation will come across one of the best economic scenarios that Bangladesh has had since independence.

Data from the Bangladesh Bureau of Statistics showed that the country has been able to accelerate its annual GDP growth rate by one percentage point every ten years since the 1980s, to reach 7.6% in 2018.

From being a predominantly aid-receiving country, Bangladesh has begun to explore the commercial arena, as the share of aid in GDP fell from around 8% in the 1990s to around 2% in recent years.

The strengthening of the country in the global market has manifested itself in the emergence of a highly competitive export-oriented sector, generating a significant increase in jobs in the manufacturing sector, in which nearly two-thirds of the workforce are women .

The export of goods and remittances have reached revenues of approximately 52,000 million dollars in 2018.

In this way, for many the last decade has challenged the predictions of the 1970s, when in "Bangladesh: the test case for development", one of the first books of the newborn nation, experts pointed out that if the Economic development was possible in a country with as many difficulties as this, it would be possible in any other.


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