The Economic and Social Commission for Asia and the Pacific (UNESCAP) of the United Nations projected that Bangladesh economy would grow by 7.40 per cent in the current fiscal year.
The UN organisation made the projection in its annual flagship publication 'Economic and Social Survey of Asia and the Pacific 2018' released on Monday in Bangkok.
It also projected that inflation would come down to 5.9 per cent at the end of FY18 and may likely to be lower further to 5.5 per cent in FY19.
The growth of the country's Gross Domestic Product (GDP) will remain static in the next fiscal year, according to the projection.
The ESCAP's projections largely match with the country's national statistical agency's provisional estimate.
The Bangladesh Bureau of Statistics (BBS) estimated that the GDP of the country would post 7.65 per cent growth in FY18.
The report, however, cautioned on the country's banking sector.
"While Bangladesh is expecting faster growth, the banking sector has been plagued by financial scams, non-performing loans and weak monitoring problems, which might cause a macroeconomic risk in the near term," it mentioned.
It also pointed out that in the wake of upcoming national elections in several countries including Bangladesh, effective fiscal management is even more important.
The report also pointed out that due to robust domestic demand and improved global economic prospects, developing economies in the region are projected to grow by 5.5 per cent in both 2018 and 2019.
"However this diagnostic does not imply that there are no risks or challenges," it added.
"Potential financial vulnerabilities along with high private and corporate debt, particularly in China and some countries in South-East Asia, declining or low foreign exchange reserves in a few South Asian economies and uncertainty concerning trends in oil prices must be closely monitored," it continued.
"With regard to the medium-term outlook, potential economic growth is on a downward trend in several countries owing to population ageing, slower capital accumulation and modest productivity growth," said United Nations Under-Secretary-General and ESCAP Executive Secretary Dr Shamshad Akhtar during the launch of Survey 2018.
At the same time, "rapid technological advancements, while promising immense opportunities are also posing considerable challenges in terms of job polarization and income and wealth inequalities," Dr Akhtar added.
[email protected]
