BD economy may grow by 7.80pc in FY20: UN

FT ONLINE

Growth rate of the Gross Domestic Product (GDP) of Bangladesh may decline to 7.80 percent in the current fiscal year (FY20) from 8.10 percent in the previous fiscal year.

Nevertheless, the projected growth rate of Bangladesh will be the highest in South Asia in 2020, according to the latest report of the United Nations on the global economy.

It pointed out that regional GDP growth fell faster than the global average, dropping from 5.6 percent in 2018 to 3.3 percent in 2019, but was moderated by strong growth in Bangladesh, Bhutan, Maldives and Nepal.

It also projected that growth rate of India and Pakistan may be recorded at 6.6 percent and 2.10 percent, respectively.

“Driven by the expansion of its garment industry, which has prospered partially as a result of trade disputes between the United States and China, Bangladesh enjoyed exceptional GDP growth of 8.1 percent in 2019,” said ‘World Economic Situation and Prospects (WESP) 2020.’

The report observed that although global trade disputes and geopolitical tensions have dampened economic growth elsewhere, Bangladesh, Bhutan and Maldives ‘have taken advantage of significant economic opportunities’ created by the turmoil.

The UN WESP 2020, released on Friday, also projected that Bangladesh would face higher inflation in the current year.

Rate of consumer price inflation may reach 5.90 percent in the current year which was 5.10 percent in the previous year, according to the UN estimate.

Mentioning the progress in achieving Sustainable Development Goals (SDGs), the report pointed out that Least Developed Countries (LDCs) collectively remain far from achieving ‘at least 7 percent’ GDP growth annually which was spelled out in target 8.1 of SDG.

“Only 15 percent of the countries—Bangladesh, Benin, Cambodia, Ethiopia, Rwanda, Senegal and South Sudan—are growing at about that rate,” added the UN report.

Regarding global growth, the report mentioned that impacted by prolonged trade disputes, the global economy suffered its lowest growth in a decade, slipping to 2.3 percent in 2019.

“The world, however, could see a slight uptick in economic activity in 2020 if risks are kept at bay,” it said adding that growth of 2.5 percent in 2020 is possible.

“A flareup of trade tensions, financial turmoil, or an escalation of geopolitical tensions could derail a recovery,” cautioned the UN WESP.

“In a downside scenario, global growth would slow to just 1.8 percent this year,” it added.