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
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