Dhaka rejects World bank’s grim forecast on economy
Dhaka, April 5 (IANS) Bangladesh’s finance minister has rejected World Bank’s forecast of its economy in the wake of global downturn and economists here insist that the economy was poised for a higher growth at 5.5 percent of the Gross Domestic Product (GDP). “I do not accept it,” said Finance Minister A.M.A. Muhith when asked to comment on the World Bank’s projection of 4.5 percent growth rate.
Bangladesh Bank, the country’s central bank, too rejected the WB projections.
Economists maintained that indicators were strong enough for achieving GDP growth of 5.5 percent or more in the current fiscal year.
“I guess this (fiscal) year’s GDP growth will be around 5.5 percent,” Wahiduddin Mahmud, a professor, told The Daily Star.
Bangladesh achieved more than six percent GDP growth on an average in the past five fiscal years since 2003-04 despite political uncertainties and natural disasters. The highest growth was 6.63 percent in 2005-06, and next to that 6.2 percent in 2007-08.
The WB, Asian Development Bank (ADB) and International Monetary Fund have predicted a lower growth for almost every economy in the wake of the global recession.
The ADB however projected Bangladesh’s GDP growth this fiscal year at 5.6 percent, which is close to the prediction made by the country’s top economists.
The minister also raised questions on how the WB made the estimate.
Bangladesh Bank Governor Salehuddin Ahmed said no economic indicator shows that growth would be as slow as 4.5 percent.
“We are hopeful of achieving six percent growth this fiscal year,” he said. Former finance minister M. Syeduzzaman said: “I believe it (GDP growth) will be between five percent and 5.5 percent.”
Mustafa K. Mujeri, immediate past chief economist of the central bank, said GDP would grow by around 6 percent this year.
Comment: To get higher pace of poverty reduction, Bangladesh needs an 8 percent GDP growth.