BD government to face acute cost-of-living crisis in 2023, affecting millions

Staff Reporter :
A UN Report has said that in 2023 the government will be managing an acute cost-of-living crisis that continues to affect affordable food and energy out of reach for millions of people.
Against the backdrop of global recovery from the Covid-19 pandemic, the war in Ukraine, competing demands for development and humanitarian assistance, and a worsening climate crisis, Bangladesh will face major challenges and some opportunities in 2023, a UN Country Team (UNCT) Results Report 2022 said on Tuesday.
“The year 2023 brings major challenges and some opportunities. Bangladesh will seek to stabilize and strengthen its economy, recover from the devastating floods of 2022, implement the reform programme associated with recent IMF loans, and prepare for a general election, among other things,” the report said.
“In 2023 the Government will be managing an acute cost-of-living crisis that continues to affect affordable food and energy out of reach for millions of people. Livelihoods support, and food security will, therefore, be key priorities of the UNCT during the year,” it added.
The findings also said that the year 2022 was challenging for Bangladesh. For the people of Bangladesh, high inflation remained the biggest concern.
After staying below six percent for the past several years, inflation rate increased through the first half of 2022, peaking at 9.5 per cent in August. Fuel prices rose sharply, and gas price surged nearly 200 per cent during the year. The impact on the most vulnerable is a continued cause for concern.
The report, however, said as Bangladesh approaches the graduation from Least Developed Country in 2026, the Government, with support of UN agencies and other partners,
will work on a strategy to facilitate this key milestone in the country’s sustainable development progress.
The UNCT will also work with development partners in supporting the private sector’s preparations for compliance with the environmental, labour and human rights standards of major trading partners in order to retain preferential access to the relevant markets.
Mentioning the funding crisis for the Rohingyas, the report said, “The year 2023 has started with a deterioration of the situation for the Rohingyas. The Rohingya have been affected by a funding shortfall that forced a cut in food assistance by 17 per cent and a devastating fire that damaged or destroyed over 2,800 shelters, and affected close to 16,000 people.
Given the high humanitarian needs, under the leadership of the Government of Bangladesh, the humanitarian community will continue to provide support to the refugees and reduce the impact on the host communities that have sheltered them, it continued
The prioritized 2023 Joint Response Plan was launched on 7 March 2023. It seeks around USD 876 million to respond to the critical needs of Rohingya refugees in Cox’s Bazar and Bhasan Char, as well as to mitigate impacts on the host communities in Ukhiya and Teknaf upazilas.
Considering competing humanitarian needs worldwide, funding the plan is expected to get more difficult. Mobilizing sufficient funds to provide life-saving support will be a key priority for the UNCT, alongside continuing advocacy for the Rohingya refugees’ safe, dignified and voluntary return to Myanmar, the report said.
It also mentioned despite these challenges, the GDP growth rate for 2021-2022 exceeded seven per cent indicating robust recovery from the Covid-19 pandemic. Major transport infrastructure projects like the metro rail and the Padma Bridge were inaugurated. They will have significant implications for the city of Dhaka and the economy of Bangladesh respectively.
Despite economic growth, there are still challenges in alleviating poverty. Stark inequalities including gender inequality, and high rates of gender-based violence persist.
Low tax receipts have constrained public investment in human development, including health, education, and social protection. The current growth model remains resource and pollution intensive, resulting in high levels of air, water and soil pollution, it mentioned.