Country Assistance Program Evaluation for Bangladesh

Abstract

Reducing poverty remains the central development challenge in Bangladesh, one of the poorest countries in the world with a per capita income of $369 in 2001. Despite very high population density, poor resource management, numerous natural disasters, and a plethora of endemic governance problems and policy weaknesses coupled with frequent political turmoil, the country has made significant economic and social progress over the past 2 decades. Its performance compares favorably with that of many other countries in the region over the period. Nevertheless, there are some factors that may make recent trends unsustainable, namely potentially greater constraints on agricultural growth to the extent that the scope for import substitution may be more limited (following the attainment of foodgrain self-sufficiency); and negative medium-term impact on both employment levels and the balance of payments position, and thus potentially on currency and price stability, arising from the probable decline of readymade garment exports and reduced levels of remittances from abroad. It thus remains as urgent as ever to pursue strategies, both at macro and sectoral levels, that will help expand and diversify investment, output, and, above all, employment so as to enhance the opportunities and living standards of as large a proportion of the still rapidly growing population as possible. Equally, measures such as a more progressive tax regime are needed to accelerate the rate of poverty reduction and improve income distribution.