A considerable number of Bangladesh work abroad and send money to Bangladesh due to a lack of employment opportunities in their home country. According to a recent World Bank survey, Bangladesh’s economy shows nascent growth rates, backed by a turnaround in exports, high remittance inflows, and the ongoing vaccination program. The economy is steadily improving after being heavily impacted by the COVID 19 pandemic, which delayed growth and reversed the poverty reduction trend for the first time in a couple of decades.
Factory reopening, online money transfer to Bangladesh by expatriates are now increasing, and exports increased in the first half of FY21. During the ongoing COVID-19 pandemic, however, the economy faces increased risks. Recent surveys in Dhaka and Chittagong, the country’s two largest cities, indicated that the labor market was improving in the first half of FY21. Food protection in poor and slum areas improved as livelihoods were gradually restored. By February 2021, the percentage of adults employed in Chittagong had returned to pre-COVID stages.
Bangladesh’s economic freedom score is 56.5, ranking it 120th in the 2021 Index of Economic Freedom. Its overall score has risen by 0.1 points, owing primarily to an increase in the tax burden score. Bangladesh is ranked 25th out of 40 Asian nations, and its overall performance is lower than the regional and global averages.
What Was The Economic Condition Of Bangladesh Pre Pandemic?
Before the outbreak of COVID-19, people use banks for money transfers to Bangladesh and vice versa, which is a costly financial movement for low-middle income families. Bangladesh was one of the poorest countries in South Asia when it gained independence, poorer than India and much more flawed than Pakistan. It floundered for many years, a massive archipelago of poverty and misery, as then-US National Security Adviser Henry Kissinger described it as a “basket case.” Things worsened in 1974 when the Nixon administration abruptly cut off food assistance to Bangladesh, which was in the midst of drought because the country profited from exporting jute bags to Cuba.
Bangladesh has become a case study in economic growth that few could have expected as the nation approaches its 50th anniversary of independence. Many ignored it as a one-off fluke when its GDP growth rate exceeded Pakistan’s in 2006. On the other hand, Bangladesh has outpaced Pakistan every year since then and is now one of the world’s fastest-growing economies. The digital finance sector is also showing rapid growth as many foreign workers send money to Bangladesh online.