Bangladesh has come a long way in terms of development. On the eve of the March 26 Independence Day celebrations, came the UN announcement on March 16 that the country had fulfilled all the three criteria to graduate from the LDC (Least Developed Country) status. With a second evaluation scheduled for 2021, it would hopefully graduate to the DC (developing country) status by the year 2024.
Prior to this, Bangladesh became a lower middle-income country (MIC) from a low-income one in 2015. Its performance in meeting the targets of the Millennium Development Goals (MDGs) was remarkable and it is progressing confidently to fulfill the Sustainable Development Goals (SDGs). It has been recording sustained gross domestic product (GDP) growth rate of more than six per cent for years together. The country achieved the MDG 1 on halving poverty five years ahead of time, with 20.5 million people rising out of poverty during the 1991-2010 period. In many of the socio-economic comparisons, indexes and rankings, Bangladesh outperforms many of its South and Southeast Asian neighbours and rival economies.
For example, country's national brand value is encouragingly on the rise with the current valuation for the year 2017 being US$208 billion from $170 billion only a year ago. Prepared by Brand Finance, which is renowned for worldwide independent brand valuation and strategy consultancy, the ranking titled 'Nation Brands 2017' shows that Bangladesh made a whopping 22 per cent growth compared to the year before. Bangladesh has been positioned at 44th, ahead of regional rival economies like Vietnam (45th with $203 billion nation brand valuation), Pakistan (50th with $171 billion valuation), Sri Lanka (59th with $77 billion valuation) and Myanmar (68th with $55 billion valuation).
The country's economy has been growing vibrantly since the independence riding especially on the successes reaped from various socio-economic policy reform initiatives. Exports of the readymade garments (RMG) sector and a robust growth of remittance inflow are two main factors. Although about 28 million people still live below the extreme poverty line as per World Bank (WB) calculations, more and more of these people are gradually coming out of the poverty trap. Bangladesh has been ranked in a better position (88th) in the latest Global Hunger Index while India and Pakistan were ranked 101st and 106th respectively.
Steady growth has rapidly increased Bangladesh's domestic demand for energy, transport and urbanisation. But insufficient planning and inadequate investment have resulted in increasingly severe infrastructure bottlenecks. To sustain growth, Bangladesh urgently needs to implement structural reforms, expand investments in human capital, increase female labour force participation, and raise productivity through increased global value chain integration. Reducing infrastructure gaps and improving the business climate would allow new productive sectors to develop and generate jobs.
An irony in the growth story of Bangladesh is that the rate of employment generation has slowed down. The recently released data of the Bangladesh Bureau of Statistics (BBS) presents a disconcerting job scenario. While the GDP growth figure is impressive, the rate of quality job creation is poor. Economists, planners, development practitioners, development partners, all have identified job creation as the country's top development priority.
Between the years 2003 and 2016, the economy generated more than 1.15 million jobs per year on an average. The pace of job creation has fallen in recent years: while the total employment grew by 3.1 per cent per annum between 2003 and 2010, it grew by only 1.8 per cent per annum between the years 2011 and 2016. Due to this slowdown, women and youth population have been hit hard in particular. The World Bank (WB) in its latest Bangladesh Development Update has observed, "Low levels of technology, outdated management practices, and lagging skills of the workforce contribute to the creation of low quality jobs. The vulnerable groups are facing higher challenges to find jobs."
Another big problem is unequal distribution of jobs among different parts of the country. Dhaka division alone accounts for 45 per cent of all industry jobs and 37 per cent of all services jobs of the country. No less worrying than regional job concentration is a very high rate of unemployment among the educated youths. The problem of unemployment of the educated youths largely originates from a highly ill-planned education system.
Bangladesh can create more, better and inclusive jobs and boost its growth potential by focusing on micro-financial stability, structural reforms, urban planning and technological advances. The prevailing situation here also calls for further policy support and special efforts for enough job creation. Our RMG sector has been a critical catalyst of creating more and inclusive jobs. Recently, while other manufacturing sectors are growing rapidly to meet increasing domestic demand, export-oriented sectors beyond RMG need to emerge to create quality jobs on a large scale. Continued labour market training programmes may also usher in further prospects.
In fact, Bangladesh is in dire need to create more and better jobs for the 2.1 million youths entering the job market every year. To do so, this country, among other things, will need to remove the barriers to higher growth posed by low access to reliable and affordable power, poor transportation infrastructure, limited availability of serviced land, rapid urbanisation and vulnerability to climate change and natural disasters. There is no denying the fact that young generation has much interest in potential new sectors, ICT-driven ventures and start-up companies. Here lies the potential for the next phase of job creation.
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