ADB's good counsel

Bangladesh needs a sustainable GDP growth rate of 7 to 8 percent to alleviate poverty in a programmatic way in order to meet the millennium goal of halving the number of poor by 2015. But it is forecast to grow at an estimated 5.3 per cent in FY 2004-05 -- thanks to the massive floods early on. Even so, we are doing relatively better than some Pacific countries with the industrial growth estimated at 7.8 per cent and exports projected to grow by 15 per cent in 2005. The services sector is also likely to grow by 6 per cent.

The inflationary pressures, fuelled by the rise in food prices against the backdrop of a reduced Aman crop, might ease off somewhat following the Boro harvests.

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The revenue collection showing a downward trend, needs to be revved up to augment domestic resources and this, coupled with rationalisation of expenditure, will help keep the budget deficit in check.

Bangladesh economy faces some challenges, two of which are governance-related, such as, law and order and confrontational politics, while the remainder is economic, like the rising international oil price and the post-MFA quota free regime for the garments export.

The world is changing, and if Bangladesh has to keep pace with it and seize the opportunities presented in a changed global context, she has to carry out some policy and institutional reforms. The Chinese example is relevant here, something that crosses our mind in presence of our honoured guest, the Chinese Premier Wen Jaibao. China is the most deserving country to be emulated in terms of introducing bold policy and institutional reforms that put her firmly on the road to sustained and high-profile economic growth. It is to China's burgeoning market that top corporate investors from the USA and EU are gravitating today.

We have a big labour force and an expanding middle class, even though the buying capacity of our people is still limited. If we can reduce the rich-poor gap substantially, our market will be that much bigger to attract investments, both domestic as well as FDIs.

We can take a leaf or two from the Chinese experience, especially in terms of raising the level of their competitiveness in the international market-place.