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Strong, timely reforms must for inclusive growth in Bangladesh: WB
The country is expected to maintain an upward growth trajectory in the medium term, but urgent reforms are critical to sustaining growth and job creation, especially for youth and women.
Bangladesh’s economy rebounded in H2 2025 after disruptions in H1, backed by exports, remittances and a rise in foreign exchange reserves, the World Bank said.
It may maintain an upward growth trajectory in the medium term, but urgent reforms are critical to sustaining growth and job creation.
GDP growth is projected to rise to 4.8 per cent in FY26 and 6.3 per cent in FY27 from 4 per cent in FY25.
The document projects gross domestic product (GDP) growth to rise to 4.8 per cent in FY26 from 4 per cent in FY25 and to reach 6.3 per cent in FY27.
External pressures eased in FY25 as a market-based exchange rate was adopted, foreign exchange reserves stabilised, the current account deficit narrowed and exports grew robustly.
Inflation moderated on the back of tight monetary policy, lower essential food import duties and strong harvests. However, the fiscal deficit widened amid weak tax revenue and higher subsidies and interest payments, the World Bank noted.
Poverty increased between 2023 and 2024, and labour force participation fell from 60.9 per cent to 58.9 per cent, with women disproportionately affected. Of the three million additional working-age people outside the labour force, 2.4 million were women.
“The economy has shown resilience, but this cannot be taken for granted,” said Jean Pesme, World Bank division director for Bangladesh and Bhutan.
‘To ensure a strong growth path and more and better jobs, Bangladesh needs bold reforms and faster implementation to address enhance domestic revenue mobilization, banking sector vulnerabilities, reduce energy subsidies, plan urbanization, and improve the investment climate,” he added.
The report calls for an urgent rethinking of spatial development strategies with a focus on reducing regional disparities as way of supporting inclusive job creation nationwide.
Fibre2Fashion News Desk (DS)