The Bangladeshi economy is helped by its big garment sector, which contributes more than two-thirds of the country’s trade. The major challenge to prosperous growth is the vulnerability of the land to cyclones and floods. However, even with such challenges, Bangladesh has experienced a growth rate of 5% since 1990. This growth has been helped by remittances from expatriates as well.
Bangladesh’s economy is characterized as poor and developing, despite several improvement efforts at the national and international levels. In 2008, the per capita income of the country stood at US$520, while the world average is $10,200. As of 2009, Bangladesh had an estimated population of 162,221,000 people. The literacy rate in the country is about 41%. The poverty rate is very high. However, over the years, there has been considerable improvement in the poverty level as well as health and education levels.
Over 50% of Bangladesh’s GDP comes from the service sector. Despite this, two-thirds of the country’s population is engaged in agricultural activities, with most of them growing paddy.
Here are some of the major impediments to the growth of Bangladesh’s economy:
Widespread political and bureaucratic corruption
Economic competition relative to the world
Frequent cyclones and floods
Insufficient power supplies
Slow implementation of economic reforms
Bangladesh is a member of several international organizations, including the Commonwealth of Nations, BIMSTEC, SAARC, the D-8 and the OIC. According to the Country Brief released by the World Bank in July 2005, Bangladesh has improved considerably in terms of reduction in population growth, human development and gender parity in schooling. The poverty rate of the country has seen a decline of 20% since the early 1990s.
Since 1975, there has been a two-fold increase in the per-capita GDP. During the 2008 global economic recession, Bangladesh managed to stay flexible. According to the Bangladesh Bureau of Statistics (BBS), there was an increment of $62 in the per capita GDP in FY2009 from US$559 at the end of FY2008. Fiscal 2009 registered per capita income of US$621. About 25% of the country’s GDP in 2009 came from remittances of expatriates, totaling $9.7 billion and garment exports worth $12.3 billion.
According to the World Bank, Bangladesh has achieved a growth rate of 5.7% in FY2009. The country has registered significant expansion in its middle class. The consumer industry has grown considerably. The increasing foreign direct investment highlights the growth rate of the Bangladesh economy.