State of other macro-economic indicator
GDP growth
According to the Ministry of Planning, Bangladesh’s economic growth accelerated to 7.28% as of June 30, 2017, while the per capita income rose from $1,602 to $1,610. Meanwhile, the Bangladesh Bureau of Statistics (BBS) data shows that the growth rate in FY2016 was 7.11%, while the per capita income was $1,465.Also Read- Bangladesh’s GDP per capita now higher than Pakistan’s
The record GDP growth was the biggest achievement for the country’s economy in 2017, though the global development agencies disagreed with the figure.
Inflation
The government has succeeded in maintaining the overall inflation rate at around 5.5%, but, the price hike of food items was a major topic of discussion in 2017, following the extensive flooding across most of the country back in August. The price of rice saw an increase by Tk15 to Tk16 per kg, depending on their varieties. The price hike forced the government to import 2,155,590 metric tons rice of from July 1 to December 17.Also Read- Middle class feels the squeeze at rising cost of living
The price of onions also witnessed a surge. On December 10, the price of one kg onion stood at Tk120, which was almost the same of the price of one kg chicken.
Investment
The overall investment slightly rose in 2017 to 30% of GDP from 29% in 2016, while the private sector contributes 23% of the GDP. Credit growth to private sector has exceeded all expectations in 2017 as it rose to around 19% from 15% in 2016. According to Bangladesh Bank’s quarterly report on currency and exchange rates, until September this year banks gave out Tk7,97,789 crore in loans, whereas by the end of September 2016 it was Tk6,75,139 crore. But, a number of economists are concerned that the investments in the disbursed credit was not visible, which raised the question of whether the money is being siphoned out of the country.Infrastructure
The country observed good performance in infrastructural development sector, but the slow speed of construction for the related projects, especially first track projects such as Special Economic Zones (SEZs) was slow. This delay could increase the estimated cost of the projects.
Project officials said the bridge’s construction work is going ahead braving strong currents in the river and inclement weather Mehedi Hasan/Dhaka TribuneThe Padma Bridge project became visible to the naked eye for the first time this year. However, there was also a concerning issue regarding the faulty design of eight of its spans.Exports and Imports
The country’s export growth was quite slow during the first months, which posted increasing trend after six months, depending on the exports, around 5% year-on-year growth was posted. While, the imports marked four times growth, especially considering the capital machinery import, which economists opined as either a sign of increasing investments or money laundering.Revenue
In 2017, the government for five consecutive years, failed to implement the new VAT law amid pressure from the business community, which created problems in revenue collection. On the other hand, the tax to GDP ratio was also around 10%, as the revenue from direct tax was not increased than the usual amount.Remittance
The remittance inflow to Bangladesh in 2017 has seen a 10% negative growth, which was mostly caused by “Digital Hundi.” However, the indicator has seen a positive mark during the last months of the year.Poverty reduction
In poverty reduction, the country kept a steady pace, though the rate of reduction has declined.Employment
According to the World Bank’s “Bangladesh Development Update September 2017”, the strong GDP growth did not reflect in the job market. Readymade garments factories, the largest job provider in the private sector, have seen a fall in job creation, while the participation of women has also declined.Power price adjustment
As of October, 2017, a total of six power plant projects have been implemented, and from those plants, 962 MW power has been added to the National Power Grid, according to Bangladesh Energy Regulatory Commission (BERC). But, on November 23, the BERC announced the hike in retail price of per unit electricity by Tk0.35, which sparked some controversies across different sections of the people in Bangladesh.
People were unhappy with a major hike in retail electricity prices Focus BanglaThe policymakers, Consumers Association of Bangladesh (CAB), chamber leaders and a section of political leaders claimed that the increase would have a far reaching impact and it was an unwise and inappropriate decision.