Dealing with Deceleration: State of Bangladesh Economy and Development 2014

The State of Bangladesh Economy and Development 2013-2014 is an annual publication by Unnayan Onneshan, and the current number focuses on the recent decelerations in the growth of Bangladesh economy through scrutinising the major macroeconomic indicators of growth and development.

The Unnayan Onneshan in its preceding two yearly publications and its numerous monthly issues of Bangladesh Economic Update highlighted that the management of an economy is contingent upon the efficacy of macroeconomic policies in preventing fluctuations in output and employment and if the current expedient regimes continue, the deceleration could not be averted.

Lack of farsightedness in the economic management coupled with recent uncertainties in the country’s political sphere have prevailed the downturn in the FY 2013-14 as well. Almost all of the early growth forecasts, including that of the Unnayan Onneshan, for the FY 2013-2014, project a rate which is not only lower than that of the preceding year, but also is below the decadal average of six percent. The rate of growth in Gross Domestic Product (GDP) has been declining than the preceding year since FY 2010-11.

The present book unearths the existing and emerging factors behind the decelerated growth of the economy through probing into the macroeconomic policy regimes that have proved to be inefficacious in preventing the declining trends.

The recent decelerations in the growth of the economy are largely, as the book reveals, attributed to the stagnation in savings and investment as well as the increasing gap between the two variables,  along with contractionary monetary policy-induced decline in the private sector credit growth, wrong diagnosis of the causes of inflation, increasing gap between the target and the actual collection of revenue, increasing per capita debt burden, falling rate of growth in the agricultural and manufacturing sectors, frequent hikes in power tariff, declining growth of export, dwindling growth of capital machineries import, and deterioration in the growth of remittance inflow.

There has been decelerated decline in the incidence of poverty coupled with increased number of educated unemployed people and decreasing allocation of budget and poor status of ADP implementation in the social sectors.

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