Dhaka, Bangladesh (BBN)- Bangladesh’s economy is set to grow by 4.0% in fiscal year (FY) 2025, before picking up to 5.0% in FY2026, the Asian Development Bank (ADB) has predicated.
The ADB in its latest Asian Development Outlook (ADO) said the country grew 4.2% in FY2024.
Growth is being held back by weak domestic demand amid political transition, recurrent flooding, labor unrest, and stubbornly high inflation, the ADB explained.
“Future growth will depend on improving the business environment, attracting investment, and ensuring reliable energy supplies,” said Hoe Yun Jeong, ADB’s Country Director for Bangladesh. He warned that the US tariffs, banking sector weaknesses, and potential policy slippages pose risks to the outlook.
Inflation is forecast to edge up to 10.0% in FY2025 from 9.7% in FY2024, driven by supply constraints and currency weakness. The current account, however, is expected to swing into a small surplus, helped by a narrower trade gap and strong remittances.
In FY2026, ADB expects consumption to drive growth, supported by remittance inflows and election spending, though tight policies and tariff hikes from key markets could dampen investment and exports. Services are likely to expand, agriculture to normalize, and industrial growth to slow under the US trade pressure.
BBN/SSR/AD