The International Monetary Fund has predicted a bleak economic prospect for Bangladesh, setting the country’s gross domestic product growth at only 2 per cent for the current fiscal year due to the coronavirus pandemic fallout.
The country last witnessed a less-than-three-per cent GDP growth (2.83 per cent) in 1989-90 due to a devastating flood.
The IMF came up with the forecast after other global lending agencies made similarly lower growth projections for the country.
The pandemic has threatened the country’s GDP growth to be its lowest in the last forty years although finance minister AHM Mustafa Kamal claimed that the growth would not be less than 6 per cent in the year.
The IMF made the prediction in its latest report titled ‘World Economic Outlook: the Great Lockdown’ released on Wednesday.
The government has set a target of GDP growth at 8.2 per cent for FY2020 against 8.15 per cent achieved in the previous FY2019.
According to the World Bank data, Bangladesh’s economic growth stood below 2 per cent for the last time in 1980 when economy grew by 0.82 per cent.
Earlier on April 12, the World Bank made a prediction that Bangladesh’s GDP growth would plunge to 2-3 per cent in the fiscal year amid the declining garment exports, lower private investment growth and widespread disruptions caused by the COVID-19 havoc.
The UK-based Economist Intelligence Unit also predicted a slower economic growth at 3.5 per cent for the year due to the coronavirus impact.
The Asian Development Bank has projected that the Bangladesh economy might lose 1.10 per cent of its GDP, or $3.02 billion, in addition to 8.95 lakh job losses due to the coronavirus effect.
Reacting to the WB’s prediction, Mustafa Kamal on Monday said that though GDP growth of the country would decline like the other countries due to coronavirus pandemic, the economic growth of Bangladesh would be above 6 per cent.
He claimed that GDP growth could not slump as deeply as the WB predicted.
The growth would be over 6 per cent based on achievement in the first eight months of the fiscal year even the country achieves zero or negative growth in the concluding four months, he said.
He also termed the WB prediction as a premature one.
He said that the outbreak could not put any negative impact on agriculture, one of the major sources of economic growth, he said.
The government also took various measures to offset the losses in industry and services sectors, he added.
Policy Research Institute executive director Ahsan H Mansur told New Age that GDP growth at 2 per cent amid the prevailing situation would not be bad for a country like Bangladesh.
‘But achieving 2 per cent growth will also be a difficult challenge for Bangladesh as people are losing their income sources, businesses, including textile, readymade garment, SMEs are being closed, services sector including hotel and restaurant are remained shut down,’ he said.
The impact of coronavirus pandemic on economy would be longer in Bangladesh as the country may take longer time to contain the outbreak due to mismanagement including insufficient testing and treatment facilities, he added.
Want stories like this in your inbox?
Sign up to exclusive daily email
More Stories from Miscellany