Dhaka, Bangladesh (BBN) – The government of Bangladesh has signed a $250 million development policy operation to support the country’s reform efforts to create large-scale, better-paid and inclusive jobs.
The agreement was signed by Monowar Ahmed, Secretary, Economic Relations Division of Bangladesh and Qimiao Fan, World Bank Country Director for Bangladesh, Bhutan and Nepal, on behalf of the government of Bangladesh and the World Bank (WB), respectively on Wednesday. Finance Minister AHM Mustafa Kamal was present as chief guest.
The credit is from the World Bank’s International Development Association (IDA), has a 30-year term, including a five-year grace period, and carries a service charge of 0.75 per cent and an interest of 1.25 per cent.
The Programmatic Jobs Development Policy Credit—the first of a series of three planned operations—will help Bangladesh build a stronger policy and institutional framework to create faster and more inclusive jobs for citizens, including women, youth, overseas migrants and vulnerable members of the population.
“Jobs are cornerstone for development. Bangladesh needs to create more and better jobs, particularly in the manufacturing sector to achieve its growth aspirations,” said Qimiao Fan.
“This program will support reforms that will address key challenges in creating inclusive and quality jobs. This will help the Government implement policies to modernize trade, stimulate investment, strengthen social protection systems for workers and help vulnerable people access jobs.”
The programme takes a comprehensive approach to overcome the barriers to job creation. It aims to help leverage Bangladesh’s comparative advantage in the manufacturing sector while stimulating investment, making doing business easier, and modernizing customs and trade facilitation. To ensure workers’ protection, it will also help implement amendments to the labor law and reform the pensions program.
In recent years, the pace of job creation has slowed, especially for women and youth.
They are often engaged in low quality informal jobs with weak protection for workers.
Besides, Bangladesh is one of the most vulnerable countries to climate change.
A recent study shows that a 15 per cent increase in the share of non‐agricultural employment would significantly reduce the impacts of climate change on living standards.
The programme will support reforms to help Bangladesh create jobs sustainably by adapting to the rapidly changing environment as well as managing the risks related to climate change, the WB added.
“The Seventh Five Year Plan, Vision 2021 and the electoral pledge ‘Bangladesh on the March to Prosperity’ have identified creating quality and inclusive jobs as a priority for the country,” said Monowar Ahmed.
“The programme will help the government’s ongoing initiatives to create labor intensive quality jobs while laying the foundation for a more resilient economy and stronger social protection.”
With 36 per cent of women in the labor force versus around 82 per cent of men, women face more challenges in accessing quality jobs.
The programme will help increase female labour force participation by making childcare more available for working mothers and targeting women and youth with training and employment services.
The World Bank was among the first development partners to support Bangladesh following its independence.
Since then the World Bank has committed more than $30 billion, mostly in grants and interest-free credits to Bangladesh. Bangladesh currently has the largest IDA program totaling $12.4 billion.