May 28, 2025 1:13 pm
Full News

World Bank Projects Bangladesh Economy Under Pressure in FY25, Recovery Expected in FY26

The World Bank has issued a cautious outlook for Bangladesh’s economy in the fiscal year 2025 (FY25), warning of continued pressure from inflation, external challenges, and domestic political uncertainty. According to the latest Bangladesh Development Update, the country’s GDP growth is set to slow to 4% in FY25, down from 5.2% in FY24, with a more optimistic 5.5% growth projected in FY26.

The global lender pointed to several factors contributing to the economic strain, including weakened consumption, falling exports, and a stagnant industrial sector. High inflation, driven by surging food and energy prices, has also played a significant role, with the inflation rate averaging 9.7% in FY24. The World Bank expects inflation to slightly ease to 9% in FY25 before dropping further to 7.5% in FY26.

Despite the bleak short-term forecast, the World Bank remains hopeful for long-term recovery, emphasizing the need for bold economic reforms. Abdoulaye Seck, World Bank Country Director for Bangladesh and Bhutan, expressed confidence in Bangladesh’s resilience, stating, “With the right reforms to enhance governance and improve the business climate, Bangladesh can return to a strong and inclusive growth path.”

Job Creation and Income Inequality Remain Key Challenges

The report also highlighted the ongoing struggle with income inequality, especially in urban areas, with Bangladesh’s Gini index (a measure of income disparity) increasing from 0.50 to 0.53 between 2010 and 2022. While unemployment has declined overall since 2016, youth unemployment, particularly in cities, remains high. The ready-made garment sector, which historically created numerous jobs, has seen stagnation, leaving educated youth and women facing difficulty in securing employment.

The fiscal deficit is also under strain, estimated at 4.5% of GDP in FY24, with limited capacity for the government to increase spending on developmental projects in FY25. However, Bangladesh saw a slight improvement in its current account deficit, which narrowed to $6.5 billion in FY24 due to reduced imports and steady remittances.

Inflation and Monetary Policies: A Tightrope Walk

On the inflation front, the World Bank reported that food inflation in Bangladesh spiked to 14.1% in July 2024, with overall inflation averaging 10.7% in the first quarter of FY25. The political unrest that occurred during the government transition in August also disrupted supply chains, exacerbating inflation. However, the World Bank anticipates a slowdown in inflation as supply issues stabilize.

In response to inflationary pressures, Bangladesh Bank has maintained a tight monetary policy, focusing on stabilizing the economy despite challenges in the banking sector, including non-performing loans and liquidity problems.

Looking Ahead: Reform and Recovery

The World Bank’s report remains cautiously optimistic, suggesting that Bangladesh’s economic resilience will be key to navigating these difficult times. The country’s move toward a market-driven exchange rate system in 2024 has helped narrow gaps between official and informal exchange rates. However, structural reforms in governance, business regulation, and employment creation are deemed essential for fostering inclusive growth.

The World Bank forecast a slow but steady recovery, with inflation set to fall to 7.5% by FY26, while Bangladesh’s growth trajectory could return to strength, provided it implements the necessary reforms to boost economic and financial governance.

Related News
Marvel Reveals ‘Avengers: Doomsday’ Cast in Live-Stream of Chairs
How the Grammy Awards Voting Works: Who Gets to Decide the Winners?
Anderson returns to professional cricket with T20
Cast Announced for New ‘Anaconda’
PM Modi Accuses Jharkhand Government of Corruption, Vows Accountability if BJP Wins
Letter Written by Titanic Passenger Sold at Record Price
Related Posts
Trump Promised ‘No Tax on Social Security’—But the GOP Tax Bill Falls Short
Continued Downtrend in Bangladesh Stock Market Sparks Investor Anxiety
Germany’s Chancellor Promises to Support Ukraine in Producing Long-Range Missiles
Trump’s 5-Step Strategy to Keep GOP Control of the House in 2026
Jakarta Emerges as France’s Leading Arms Client in Southeast Asians
Trump’s Fury with Putin Grows Amid Republican Rift Over Ukraine War
More News

Trump is Now Deporting Some Foreign Students

The administration of U.S. President Donald Trump has decided to identify and deport foreign students who harbor hatred towards other religions and cultures and exhibit anti-Semitic sentiments. Trump has already signed an executive order regarding this matter. During Israel’s military operation in Gaza, protests demanding a ceasefire and an independent Palestinian state took place for […]

Rebels Enter Damascus, President Assad Flees

Syrian President Bashar al-Assad has fled. After rebel fighters entered the capital Damascus almost unopposed, Assad left the city by plane. However, his destination remains unknown. This information was reported by news agency Reuters on Sunday, December 8. According to the report, two senior military officials informed Reuters that Syrian President Bashar al-Assad departed from […]

Liverpool’s Van Dijk blames referee after Tottenham defeat

Liverpool manager Erna Slot also questioned the referee’s decision. In the midst of moving forward in a great rhythm, Liverpool suddenly lost its way. After dropping points in the Premier League to Manchester United, who have suffered throughout the season, they have now lost to Tottenham Hotspur. Liverpool defender Virgil van Dijk has questioned a […]

Deepfakes Pose Serious, Long-term Risks to Children

If your child hasn’t encountered a deepfake involving someone from their school, chances are, someone they know has. Deepfakes are AI-generated images, videos, or audio that look or sound real but are entirely fabricated.A recent survey by the Center for Democracy & Technology reveals that 40% of students and 29% of teachers have been aware […]

Bangladesh’s Chief Adviser Yunus’s Press Secretary Shafiqul Alam Finally Admits Anti-Hindu Violence

Bangladesh Admits Targeting of Hindu Minorities, Pledges Action Against Perpetrators DHAKA – In a significant development, the Bangladeshi government has officially acknowledged the targeting of Hindu minorities in acts of violence, with Press Secretary Shafiqul Alam revealing that 88 cases have been filed and 70 individuals arrested as of October 2024. Speaking on behalf of […]

Saudi Club Is Ready With 4 Thousand 200 Crores For Vinicius, What Will The Real Star Do?

Unbelievable – the word sometimes does not fully convey the level of disbelief. The cost calculation of 350 million dollars or 4 thousand 200 million taka for a player creates such distrust among everyone. It’s fine if it’s a movie or a story-poetry, but how is it possible in reality! But even if it sounds […]

‘Project Runway’ Producer and Corey Damen Jenkins Launch Premium Design Series on YouTube

Goodbye Pictures, the team behind Project Runway, has teamed up with acclaimed interior designer Corey Damen Jenkins for a brand-new YouTube series, Design Reimagined, which made its debut on May 16. The seven-episode series brings cinematic production values and real-world design insight to the digital space, aiming to set a new standard for home content […]

Transgender Influencer Arrested Under Indonesia’s Blasphemy Law

Nafis Sadique Shatil Indonesia’s contentious blasphemy law has once again sparked debate, following the arrest of a transgender influencer in Medan, North Sumatra. The influencer, known as Ratu Thalisa, or Ratu Entok, was taken into custody on October 10 after Christian groups filed police reports accusing her of blasphemy. The incident stems from a TikTok […]

Season’s Greetings from The Voice News

Season’s Greetings from The Voice News As we celebrate this festive season, we want to extend our warmest wishes to our readers, partners, and communities. Christmas is a time to reflect on the joys and challenges of the past year, to embrace the spirit of giving, and to look forward with hope and optimism to […]

Classic Car Market Thrives as Record-Breaking Auctions Continue

The classic car market has seen remarkable growth in recent years, driven by demand far outstripping supply. This surge has led to eye-watering prices, with even models like the Edsel fetching $100,000. However, at the top end of the market, the stakes are even higher, with millions of euros, dollars, or pounds exchanged for historically […]