ADB suggests economic diversification, job skills to accelerate growth in Bangladesh

Improved infrastructure and a more diversified economy can help Bangladesh increase economic growth, create meaningful jobs and enhance structural transformation as a thriving middle-income economy, the Asian Development Bank (ADB) said on Thursday.

Two ADB reports said public-private partnerships can contribute to infrastructure upgrades in some of the country's most successful economic sectors, while secured land ownership and improved urban planning and development will help attract more foreign investment.

Reliable electricity, efficient urban transport systems and measures to support new industries and economic activities are also important, the reports noted.

According to the reports, poverty in Bangladesh declined rapidly from nearly 49 percent in 2000 to below 24 percent in 2016.

The study noted that reducing poverty more evenly across the country, boosting access to financial services for low income groups, and strengthening social safety nets will further improve livelihoods and increase economic opportunities.

"The ready-made garments sector and overseas remittances have fuelled strong growth of over 6 percent in the past decade, allowing the economy to recently graduate to middle income status, " said Edimon Ginting, director in ADB's Economic Research and Regional Cooperation Department.

"Moving forward, the country can sustain higher growth through investment in sectors such as light engineering, machinery repair, and agricultural cold chains. Better infrastructure and policy reforms can help the country capture these opportunities."

According to the reports, Bangladesh has been an innovator in microcredit services globally and there is significant scope to boost the sector further, particularly with the growing use of mobile technology. Incentive programs to improve financial services for small and micro depositors can also create a pool of funds that can be channeled for infrastructure development.

Other priority areas include improved access to power, better fuel pricing mechanisms, and increased energy conservation and efficiency, they said, adding that private investment in power and oil and gas exploration and tapping further into regional electricity market could help Bangladesh meet its energy needs.

(APD)