Dhaka, Bangladesh (BBN) - The achievement of targeted economic growth will not be possible without further development of the power, energy and communication infrastructure, the central bank has said.
"Attainment of the expected gross domestic product (GDP) growth in the fiscal year (FY) 2012-13 will depend mainly on effective adoption of prudent macroeconomic policies in a sound domestic economic environment along with global economic recovery," the Bangladesh Bank (BB), the country’s central bank, said in its annual report for fiscal year (FY) 2011-12, released on Thursday.
The report also said the accompanying achievements of a more stable exchange rate and a declining inflation setting have contributed to the favourable revision in macroeconomic indicators announced in the updated Medium Term Macroeconomic Framework (MTMF) for 2013-17.
"Bangladesh's recent economic growth averaging 6.2 per cent over the past decade is undoubtedly impressive.”
The real GDP growth has been projected to rise to 7.2 percent in FY '13 and increase gradually to 8.0 percent by FY '15 and remain slightly above this 8.0 percent level thereafter.
"It is envisaged that these large investment projects would be undertaken by both the government and the private sector, as well as through joint endeavours," the BB suggested.
Furthermore, underlying the growth projections are additional expansion in the industry and services sectors, it said, adding that the main growth impetus from these sectors would stem principally from further expansion of small and medium enterprise (SME) activities and augmenting agriculture outputs through productivity enhancements and diversification.
The BB also said Bangladesh will also need to focus on markets outside the European Union (EU), particularly in the ASEAN and the SAARC countries.
"These sound economic policies combined with the policies contributing to rapid gains in social indicators will contribute to Bangladesh's aspiration to become a middle income country in the near future," it noted.
It also said global growth performance should improve moderately in 2013 given the proactive role adopted by the European and the US policymakers to deal with their major short and medium term economic challenges.
The central bank also said even against this background of difficult global economic conditions, the prospects for the Bangladesh economy are favourable over the near and medium term.
However, macroeconomic policies must continue to support a vigorous and sustained expansion in agriculture and industry together with an acceleration in investment activities while striving to maintain inflation under control, the report added.
"This policy course will reinforce the recent trends in the economy which has experienced a moderate growth in the agriculture sector, increased government revenue collection and large investments in infrastructure including in the power sector," it noted.
BBN/SSR/AD-09Mar13-1:05 pm (BST)