IMF projects 6.66% GDP growth for Bangladesh in FY25

The International Monetary Fund (IMF) has projected the Gross Domestic Product (GDP) growth for Bangladesh at 6.6 per cent for the upcoming fiscal 2024-25 (FY25).

The projection of the global lender nears the Bangladesh government’s projection for the next fiscal, reports BSS.

The government is eying attaining a GDP growth target of 6.75 per cent in the next fiscal year (FY25).

Chris Papageorgiou, IMF Mission Chief for Bangladesh, said Bangladesh’s economy faces multiple challenges as external shocks and global uncertainties have amplified macroeconomic vulnerabilities.

“Growth momentum has moderated over the past year and a half due to higher inflation eroding consumer’s purchasing power, tighter fiscal and monetary policies required to tame inflation, and foreign exchange shortages and import restrictions further limiting aggregate demand. Nonetheless, exports -- an important driver of Bangladesh’s economy -- have remained relatively resilient,” he added.

He said the near-term growth trajectory will depend on timely resolution of issues such as heightened inflation and external imbalances.

This would allow for a shift to a more accommodative policy stance, he added.

According to staff’s projections, he mentioned, Bangladesh’s economy may grow at a slower rate of 5.4 per cent in FY24, compared to the rate a year ago.

“However, we anticipate stronger growth at 6.6 per cent in FY25 as the domestic macroeconomic outlook and external position gradually stabilize,” he added.

In the longer term, he said, maintaining high-paced growth will crucially depend on the consistent implementation of structural reforms to improve the business climate.

Priorities in the reform agenda should therefore include expanding and diversifying foreign trade, attracting foreign direct investment, improving governance, strengthening the financial sector, mobilizing fiscal revenue, and developing infrastructure, he added.

Chris Papageorgiou, however, said over the past decade, Bangladesh has achieved impressive economic growth and social development, making steady progress in reducing poverty and across many Sustainable Development Goal (SDG) indicators.