Preview

Barriers to Economic Growth in Bangladesh

Powerful Essays
Open Document
Open Document
1878 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
Barriers to Economic Growth in Bangladesh
“For a developing country of your choice, identify and critically evaluate the barriers to growth and development. How can public policy attempt to lift those barriers?”

This piece will look to identify and evaluate barriers to growth and development in Bangladesh, and then suggest ways of overcoming those barriers. Bangladesh has achieved significant results in her economic sector since her independence in 1971. Through the Nationalization Order of 1972, all key industries including jute, cotton textiles and sugar were vested upon the public sector. The wholesale nationalization of industries resulted in a low growth of the economy. The Gross National Product (GNP) per capita of the country grew at an average annual rate of 0.4 per cent until 1985 compared to 3.8 per cent for the group of low income countries (The World Development Report, 1989). The low growth performance of the economy put pressures on the government to privatize major industries and to undertake economic reforms.

The economy has improved dramatically in the 1990’s, however Bangladesh still suffers from major growth deficiencies in several areas such as foreign trade in the South Asian region. Efforts to fulfill Bangladesh’s macroeconomic targets have been complicated mainly due to various factors including the country’s large population (Bangladesh is the most densely populated country in the world), and corruption within the government to name just a few. Other major obstacles for Bangladesh to overcome in order to achieve growth include the inefficiency of state owned enterprises, inadequate power supplies and slow implementation of economic reforms. Even though Bangladesh has made some progress improving the conditions for foreign investors and liberalizing the capital markets, foreign investors in a range of sectors are still increasingly frustrated with the politics of confrontation, the level of corruption, slow rate of reform and privatization and deregulation of the public

You May Also Find These Documents Helpful

  • Good Essays

    Access the significance of three factors which might limit economic development in developing countries. (20)…

    • 456 Words
    • 2 Pages
    Good Essays
  • Better Essays

    Assess the significance of three factors which might limit economic development in the developing countries.…

    • 1995 Words
    • 6 Pages
    Better Essays
  • Powerful Essays

    “Geography is the study of the world, its people and the interactions between the two”- said by Mr. Bowerman a famous geologist.…

    • 2372 Words
    • 10 Pages
    Powerful Essays
  • Better Essays

    1. 2. Kazi Mostafa Arif1* Munshi Murtoza Ali2 Assistant Professor, Department of Economics, Islamic University, Kushtia 7003, Bangladesh. Assistant Professor, Department of Politics and Public Administration, Islamic University, Kushtia 7003, Bangladesh. *E-mail of corresponding: arifeconomics@yahoo.com…

    • 5916 Words
    • 24 Pages
    Better Essays
  • Best Essays

    Mahmud Hasan Shah Department of Economics, Jagannath University, BANGLADESH. mhs_ju@yahoo.com Shahida Pervin Department of Economics, Jagannath University, BANGLADESH. Spervinruby@yahoo.com…

    • 4455 Words
    • 18 Pages
    Best Essays
  • Good Essays

    Current Economic Condition: Bangladesh is a mixed economic country where they follow both social and capitalist system. Despite several economic reforms, however, the country is still far from enjoying an efficient market economy. Bangladesh's economy remains largely agricultural, with a relatively small…

    • 916 Words
    • 4 Pages
    Good Essays
  • Powerful Essays

    A nation’s growth domestic product (GDP) represents the economic market values for the goods and services that businesses produce. Many factors influence the GDP growth process. These include government monetary and fiscal policy, political stability, domestic capital formation, development of human capital, banking and financial infrastructure, export policies and foreign direct investment. In many cases, these factors all occur differently in each nation; other times, different factors can play a role. These factors provide a significant platform to measure economic development collectively. But for the vast majority of the developing countries, due to the economic stages they are stuck in, lack of political will, shortage in capital or environmental resource or a combination of them, there have been cycles of economic chaos and encountered economic growth difficulties. For countries in Asia, Africa, and Latin America, sustained economic growth might be distant goal that is…

    • 4221 Words
    • 27 Pages
    Powerful Essays
  • Good Essays

    Although one of the world 's poorest and most densely populated countries, Bangladesh has made major strides to meet the food needs of its increasing population, through increased domestic production augmented by imports. The land is devoted mainly to rice and jute cultivation, although wheat production has increased in recent years; the country is largely self-sufficient in rice production. Nonetheless, an estimated 10% to 15% of the population faces serious nutritional risk. Bangladesh 's predominantly agricultural economy depends heavily on an erratic monsoonal cycle, with periodic flooding and drought. Although improving, infrastructure to support transportation, communications, and power supply is poorly developed. Bangladesh is limited in its reserves of coal and oil, and its industrial base is weak. The country 's main endowments include its vast human resource base, rich agricultural land, relatively abundant water, and substantial reserves of natural gas. Following the violent events of 1971 during the fight for independence, Bangladesh--with the help of large infusions of donor relief and development aid--slowly began to turn its attention to developing new industrial capacity and rehabilitating its economy. The static economic model adopted by its early leadership, however--including the nationalization of much of the industrial sector--resulted in inefficiency and economic stagnation. Beginning in late 1975, the government gradually gave greater scope to private sector participation in the economy, a pattern that has continued. A few state-owned enterprises have been privatized, but many, including major portions of the banking and jute sectors, remain under government control. Population growth, inefficiency in the public…

    • 5969 Words
    • 21 Pages
    Good Essays
  • Powerful Essays

    During the period under review, Bangladesh's legislative and institutional framework governing trade and foreign direct investment has changed only slightly. Efforts have been made to ensure better policy coordination of trade and related WTO matters by, inter alia, creating a WTO Cell at the Ministry of Commerce, the Bangladesh Foreign Trade Institute and a National Advisory Committee. Despite its strong attachment to, and active involvement in, the multilateral rules-based system, Bangladesh, an advocate of special and differential treatment of LDCs at the WTO, is involved in negotiations to deepen its existing regional integration (including free-trade agreements) and for other preferential trade arrangements. Bangladesh has benefited from several forms of trade-related technical assistance (Annex II.1). Foreign direct investment in the ready made garments (RMGs) industry is no longer discouraged.…

    • 7724 Words
    • 31 Pages
    Powerful Essays
  • Best Essays

    Proposal

    • 3680 Words
    • 15 Pages

    1. INTRODUCTION Like many developing countries, the primary focus of policies in Bangladesh is to obtain high and sustainable growth. However, to achieve and maintain a higher growth rate, policy makers need to understand the determinants of growth as well as how policies affect growth. Trade liberalization policy in 1990 opened up the opportunity for the Bangladesh economy to enhance economic growth and foster overall development. Openness can have a positive effect on economic growth, exports, imports, FDI and…

    • 3680 Words
    • 15 Pages
    Best Essays
  • Powerful Essays

    Foreign Aid

    • 2646 Words
    • 11 Pages

    Poverty reduction has always been the major development challenge for Bangladesh. It was and still is the overarching objective of the government since independence in 1971. Sustained economic growth since the early 1990s has allowed the country to make good progress in poverty reduction and gains in Human Development Index despite a series of domestic and external setbacks. During the past decade of 2000-01 to 2009-10 Bangladesh has achieved an average GDP growth rate of 5.83 percent per year with GDP per capita reaching US$ 685 in 2010. Revenue reforms led to increased revenue/GDP ratio from 9.6 in 2000-01 to 11.0 in 2009-10. The expenditure/GDP ratio has also increased significantly during this period and remained 14.5 percent…

    • 2646 Words
    • 11 Pages
    Powerful Essays
  • Powerful Essays

    Last year, the International Monetary Fund (IMF) indicated that Bangladesh’s economy had become the 48th largest in the world. The UK Investors Chronicle has identified Bangladesh as one of the world’s seven hottest emerging markets due to its relatively stable currency with solid foreign reserves and record foreign remittances, as well as 6.7% real growth rate in 2011. The Bangladesh government has set itself the challenge to transform into a middle income country by 2021. In line with this strategic vision, the government has undertaken massive programmes for infrastructure development in partnership with the private sector. As the government allows 100% FDI, the infrastructure sector offers an interesting mix of opportunities for overseas interests.…

    • 1762 Words
    • 8 Pages
    Powerful Essays
  • Good Essays

    Socio-economic indicators demonstrate that Bangladesh is a strong emerging economy and a culturally enriched nation.This emergence has been gradually recognised worldwide and the international media has reported that Bangladesh may surpass western countries by 2050.…

    • 614 Words
    • 3 Pages
    Good Essays
  • Powerful Essays

    - (2001): 'Bangladesh: Structural Adjustment and Beyond ' in W Mahmud (ed), Adjustment and Beyond: The Reform Experience in South Asia, Palgrave-Macmillan/St Martin 's Press in association with International Economic Association, Basingstoke, UK, and New York. - (2002): Popular Economics: Unpopular Essays, University Press, Dhaka. - (2002a): 'National Budgets, Social Spending and Public 6oice: The Case of Bangladesh ', IDS Working Paper 162. Institute of Development Studies, University of Sussex, Brighton, UK. - (2003): 'Strategy for Pro-Poor Growth in Bangladesh ', paper presented at seminar on Accelerating Growth and Poverty Reduction in Bangladesh, World Bank and Bureau of Economic Research, University of Dhaka, Dh4ka, June 26-27. Mahmud, W, S H Rahman, and S Zohir (2000): 'Agricultural Diversification: a Strategic Factor for Growth ' in R Ahmed, S Haggblade and TChowdhury (eds), Out of the Shadow of Famine: Evolving Food Markets and Food Policy in Bangladesh, Johns Hopkins University Press, Baltimore. Nadvi, Khalid (2003): 'Globalisation and the Challenges to Bangladesh 's Garment Industry ', mimeo, Institute of Development Studies, University of Sussex. Osmani, S R, W Mahmud, B Sen, H Dagdeviren and A Seth (2003): The Macroeconomics of Poverty Reduction: The Case of Bangladesh, UNDP Asia-Pacific Regional Programme of Macroeconomics of Poverty Reduction, Dhaka and Kathmandu. Task Forces (1991): 'Macroeconomic Policies ' in Report of the Task Forces on the Bangladesh Development Strategies for the 1990s, University Press, Dhaka. World Bank (1999): Bangladesh Trade Liberalisation: Its Pace and Impacts. Report No 19591 BD. World Bank (South Asia Region), Washington, DC. - (2003): Bangladesh: Public Erpenditure Review, World Bank and Asian Development Bank, Washington, DC, Manila. -(2004)~ Trade Policiesin SouthAsia: An Overview, World Bank, Washington, DC. - (2004a): Bangladesh: Growth and Export Competitiveness, Draft, World Bank (South Asia Region), Washington, DC.…

    • 11529 Words
    • 47 Pages
    Powerful Essays
  • Powerful Essays

    Bangladesh has made remarkable progress in macroeconomic management. Acceleration of economic growth, gradual decline of budget deficit, high rate of export and import growth, steady rise of foreign currency reserve at a satisfactory level are some of the major achievements that Bangladesh attained during the past few years until FY2007-2008. Success in achieving these significant milestones is largely attributable to a set of policies and reforms implemented in order to attain macroeconomic stability accompanied by acceleration of economic growth. With continued economic growth Bangladesh Economy has established itself on solid foundation.…

    • 3619 Words
    • 14 Pages
    Powerful Essays