Bangladesh GDP growth: UN cuts forecast to 5.6pc
Staff Reporter :
The United Nations (UN) has trimmed its forecast on Bangladesh’s economic growth to 5.6 per cent for the fiscal year of 2023-24 from its previous projection of 6 per cent.
UN also projected a slightly improved 5.8 percent economic growth for the country in FY25, according to its recently published flagship economic report titled “World Economic Situation and Prospects (WESP) 2024.
The UN also projected that Bangladesh will see a decline in inflation to 6.8 percent in 2024 from an estimated 9.6percent in 2023.
The UN’s projection comes after the Asian Development Bank (ADB) in December last year cut the growth forecast for Bangladesh’s economy to 6.2 percent for FY24.
“In Bangladesh, real GDP growth is expected to slow in 2024, whereas economic growth in Nepal is projected to improve,” said the UN report.
The UN had predicted global economic growth is projected to slow from an estimated 2.7 percent in 2023 to 2.4 percent in 2024, trending below the pre-pandemic growth rate of 3.0 percent.
South Asia’s economic growth is forecasted to remain robust at 5.2 percent in 2024, albeit slightly lower than the estimated 5.3 percent in 2023, driven by a strong expansion in India, which remains the fastest-growing large economy in the world.
As the region is highly vulnerable to extreme weather conditions, the return of the El Niño climate phenomenon will also pose a significant risk to the economic outlook, the report identified.
In about a quarter of all developing countries, annual inflation is projected to exceed 10 per cent in 2024, the report highlights.
In South Asia, inflation is projected to ease to 9.2 percent in 2024 from an estimated 13.4percent in 2023 as domestic demand softens, international commodity prices stabilize, and local currency depreciation ease.
The report also pointed out that the international trade is losing steam as a growth driver, with global trade growth weakening to 0.6 per cent in 2023, recovering to 2.4 per cent in 2024.
Shift in consumer spending from goods to services, rising geopolitical tensions, supply chain disruptions, and the lingering effects of the pandemic as factors impeding trade growth.
Furthermore, the shift towards protectionist policies in some countries has also influenced trade dynamics, leading to a reevaluation of global supply chains and trade agreements.
António Guterres, United Nations Secretary General, said, “2024 must be the year when we break out of this quagmire. By unlocking big, bold investments we can drive sustainable development and climate action, and put the global economy on a stronger growth path for all.
“We must build on the progress made in the past year towards an SDG Stimulus of at least $500 billion per year in affordable long-term financing for investments in sustainable development and climate action,” the UN Secretary General expressed.
