Bangladesh reforms
Bangladesh can return to inclusive growth path with urgent reforms: WB
Bangladesh's post-COVID recovery continues to be impacted by high inflation, balance of payments deficit, financial sector vulnerabilities and increasingly limited job opportunities for its youths, especially women and educated youths, says the World Bank.
The multinational lender that provides financial support to developing countries for projects aimed at reducing poverty and fostering economic development said this in its twice-yearly-update, released on Tuesday.
“In recent years, Bangladesh’s growth has not translated into job creation for the large number of youths entering the job market every year. Particularly, the educated youth and women faced difficulty in getting jobs to fulfill their aspirations,” said Abdoulaye Seck, World Bank Country Director for Bangladesh and Bhutan.
He went on to say, “But time and again, Bangladesh has shown extraordinary resilience and determination in the face of adversity. I am confident that with urgent and bold reforms to enhance economic and financial governance, improve business environment, Bangladesh can return to a strong and inclusive growth path, with millions of jobs for its youth.”
The latest Bangladesh Development Update highlights that global and domestic factors have created a challenging macro-fiscal context for the country.
Bangladesh's real GDP growth moderated to 5.2% in FY24, primarily due to weak consumption and exports.
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It is projected to decelerate to 4.0 percent in FY25, driven by subdued investment and industrial sector activities, before accelerating to 5.5 percent in FY26 and returning to a robust growth trajectory thereafter.
Bangladesh also faces increasing income inequality, particularly in urban areas. From 2010 to 2022, Bangladesh's Gini index—a measure of income inequality—increased by nearly three points from 0.50 to 0.53.
The report highlights urgent and bold reforms that are necessary to help the country return to a strong, inclusive and sustainable growth path.
Despite the overall unemployment rate declining between 2016 and 2022, young people face significantly higher unemployment rates, particularly in urban areas.
The availability of jobs has declined for urban educated youth, and job creation in large industries, like the ready-made garments sector, has stagnated. Since 2016, while more jobs were created in Dhaka, three divisions—Chattogram, Rajshahi, and Sylhet—faced significant net employment losses.
Inflation, driven by high food and energy prices, averaged 9.7% in FY24. Inflation spiked in the month of July and moderated in August. It is expected to remain elevated in the near term, but gradually subside in the medium term if supply-side issues stabilize and prudent monetary and fiscal policies are maintained.
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The fiscal deficit is estimated to have moderated marginally to 4.5% of GDP in FY24 and is expected to remain within the government's target of 4.3 percent of GDP in FY25, with fiscal space for productive expenditures increasing only gradually.
The implementation of the Annual Development plan declined to 80.9 percent in FY24 compared to 85.2 percent in FY23.
The current account deficit narrowed to $6.5 billion in FY24, thanks to a contraction in imports and robust remittances. Remittances declined in July due to disruptions but rebounded. The balance of payments deficit also improved.
“Pressure on the external sector is expected to persist in FY25, easing later if global conditions improve and exchange rate flexibility increases,” said Dhruv Sharma, World Bank Senior Economist and Co-author of the report.
In May 2024, Bangladesh Bank implemented a crawling peg exchange rate system as a step towards a market driven exchange rate system.
This led to a narrowing in the gap between the formal and informal exchange rates. While the banking sector faces tight liquidity conditions and elevated non-performing loans the Bangladesh Bank has made restoring discipline and stability in the sector a priority alongside managing inflation.
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Jamaat proposes 41 reforms, calls for judiciary and electoral system overhaul
Bangladesh Jamaat-e-Islami has put forward a comprehensive set of 41 proposals for state reform, including key changes to the judiciary, the abolition of electronic voting machines (EVMs), and police law reforms. The party also called for increasing the age limit for government jobs to 35 years and raising the retirement age to 62.
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The proposals were unveiled today by Jamaat’s Nayeb-e-Ameer Dr. Syed Abdullah Mohammad Taher during a press conference at the Westin hotel in Dhaka’s Gulshan. Jamaat's Ameer, Dr. Shafiqur Rahman, was also present at the event.
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At the outset of his speech, Dr. Taher prayed for those who lost their lives during the July-August movement, calling on Allah to accept them as martyrs. He accused the Awami League of establishing authoritarian control over the country, saying, "Awami League entrenched its power through dictatorship, capturing the administration, executive branch, and judiciary. Thousands of cases were filed to create a reign of oppression."
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Dr. Taher emphasized the need for a separation between the judiciary and the executive branch. “To ensure justice, the judiciary must be reformed,” he said, adding that civil cases should be resolved within five years and criminal cases within three years.
Restoration of Caretaker Government and EVM Abolition
Jamaat-e-Islami also reiterated its demand for the reinstatement of the caretaker government system for national elections, accusing the Awami League of dismantling the electoral process. "The ruling party destroyed the electoral system by abolishing the caretaker government," the party said, stressing the need for its permanent restoration and the cancellation of the EVM system.
Police Reforms and Accountability
The party also called for reforms in police laws, proposing the creation of an independent commission for transfers and promotions to eliminate political interference. Dr. Taher advocated for incorporating religious and moral education into police training and reducing the use of lethal weapons.
Reforms in Government Employment
On government employment, Jamaat proposed that job applications should be free of charge and that the maximum age limit for entry into government jobs be raised to 35 years for the next two years and then set permanently at 33 years, with retirement at 62. The party also demanded the cancellation of appointments obtained through leaked examination papers or corruption. Strengthening the Anti-Corruption Commission (ACC) to operate independently was another key recommendation.
Term Limits for Prime Ministers
Jamaat proposed a two-term limit for anyone holding the office of Prime Minister, advocating for a balance of power between the Prime Minister and the President.
Cultural and Educational Reforms
The party also suggested reforms in the cultural and educational sectors, recommending the inclusion of teachings about Prophet Muhammad (PBUH) in all levels of education. They further called for the elimination of obscenity in films, television dramas, and digital content.
Foreign Relations and Hajj Costs
On foreign policy, Dr. Taher emphasized the importance of fair and balanced relations with neighboring countries, particularly on shared rivers with China, Nepal, and India. Jamaat also urged the government to take effective steps to reduce the costs of Hajj and Umrah for pilgrims.
Accountability for Genocide
Jamaat Ameer Dr. Shafiqur Rahman demanded that those involved in genocide who had fled the country be brought back and tried in court.
Election vs. Reform: Jamaat’s Roadmap
When asked about the sequence of elections and reforms, Dr. Shafiqur Rahman said that there would be two roadmaps—one for reforms and one for elections. He emphasized that neither process should be excessively long or rushed, noting, “There are many political parties in the country. For a vibrant parliament, the public must vote for the right candidates, not just the party.”
5 days ago