ZCZC
BSS-24
MCCI-ECONOMIC REVIEW
Bangladesh needs to have 10pc GDP growth: MCCI
DHAKA, Feb 25, 2019 (BSS) – Bangladesh needs to accelerate the GDP growth to about 10 percent from the present 7.86 percent, expand exports and stimulate investment to attain the middle-income status by 2021.
“Bangladesh has plenty of opportunities to achieve these goals. The GDP growth in the current fiscal year is expected to exceed last year’s 7.86 per cent,” said the latest review on economic situation of Bangladesh for the 2nd quarter (July-December) carried out by the Metropolitan Chamber of Commerce and Industry (MCCI).
The review said in the Monetary Policy Statement (MPS) for H2 of FY19, Bangladesh Bank forecasts GDP growth above 8.0 percent in FY19. Development partners – World Bank and ADB – however, predicted lower growth rates for the economy in the current fiscal year (FY19). World Bank’s growth prediction is 7.0 percent while that of ADB is 7.5 percent.
The review said the agriculture sector performed well in the 2nd quarter under review thanks to favorable natural factors and official policy to ensure timely availability of inputs at affordable prices, the sector grew at a robust rate of 4.19 percent in FY18 compared to a moderate 2.97 percent in FY17.
Despite the shortage of energy, both gas and power, the industry sector managed to grow by 12.06 percent in FY18, exceeding the growth rate in the previous fiscal by 1.84 percentage points.
The review said the power supply situation improved in the 2nd quarter under review but the demand for power shot up, too.
“Total installed capacity rose to 17,965 MW in January 2019, but production remained low because of gas shortage and also because of shutting down of some power stations for maintenance,” it said.
The buoyancy in the stock markets continued at the end of the quarter under review on the back of a significant increase in the participation of retail investors.
During the July-November period of FY19, NBR’s tax revenue collection stood 7.15 percent higher at Taka 79,733 crore, compared to Taka 74,414 crore collected during the corresponding period of FY18.
The rate of implementation of the Annual Development Programme (ADP) in the first half of the current fiscal year was 27.45 percent, which is slightly higher than the implementation rate in the corresponding half of the previous fiscal year which was 27.02 percent.
Export earnings (merchandise) in the first half (July-December) of the current fiscal year (FY19) were $20.500 billion, registering 14.42 percent growth over the export earnings of $17.916 billion in the corresponding period of the previous fiscal year. The export earnings also exceeded the strategic target of $18.785 billion by 9.13 percent.
Remittance inflows during the 2nd quarter increased slightly by 2.26 percent to $3.622 billion compared to $3.542 billion in the corresponding quarter of the previous fiscal year.
The development partners disbursed $1.870 billion of concessional loans and grants in July-November of FY19, which was 9.36 percent higher than the amount received ($1.710 billion) in the corresponding period of FY18.
In the first five months of the present fiscal (July-November of FY19), the net FDI decreased by $29 million or 4.47 percent to $620 million from $649 million in the corresponding five months of FY18.
The overall trade deficit eased by 12.46 percent in the first five months of the current fiscal (FY19), thanks to a rise in exports and a slowdown in imports.
The deficit in trade in services, too, narrowed by 37.11 percent in the same period. Inward remittances also increased during the period.
The current-account deficit was $2.558 billion during the period under review, down from $4.744 billion in the corresponding period of the previous fiscal.
The general point to point inflation fell slightly by 0.02 percentage point to 5.35 percent in December 2018 from 5.37 percent in November 2018. The rate of inflation in December was at its lowest in 19 months on the back of a fall in prices of both food and non-food items.
According to BBS, the lowest inflation rate was recorded at 5.39 per cent in March 2017. A year ago, in December 2017, the inflation rate was 5.83 per cent.
BSS/pr/GM/BR/1810