Growth in the country’s gross domestic product (GDP) has slowed down due to the corona. In some countries, the GDP has shrunk. However, in this time of crisis, the main indicators of the economy, including the expansion of exports and revenue, the booming capital markets and the foreign exchange reserves, have returned to positive trends and Bangladesh has been able to keep high GDP growth in 2021. At the same time, due to the revitalization of the agricultural sector and the creation of new employment opportunities during the Corona period, the Covid situation has been successfully tackled.
And the biggest good news for Bangladesh this year, as it draws to a close, is the final approval of the UN General Assembly (UNGA) recommendation to move from the Least Developed Countries (LDCs) list. Through this, in the golden jubilee of independence, the economic and social prosperity of the country was recognized in the last 50 years. If everything goes well now, Bangladesh will come out of LDC in 2026.
In the last one year, the chairman of the Bangladesh Palli Karma Sahayak Foundation (PKSF) to evaluate the country’s economy. Kazi Khaliquzzaman Ahmed said that the greatest good news for Bangladesh in 2021 was that the final recommendation to cross the Least Developed Countries (LDCs) was approved by the UN General Assembly (UNGA). Through this, the economic and social prosperity of the country has been recognized in the last 50 years. Now the whole world has started recognizing Bangladesh in a new way.
The eminent economist thinks that the cowardly situation has become much easier to deal with as the agricultural sector has been active throughout the Corona. However, he suggested that attention should be paid to ensure that small and medium enterprises get more benefits from the government’s loan incentives.
Former Governor of Bangladesh Bank. Atiur Rahman thinks that the economy of Bangladesh is on the right track even in Corona. It can be said that our economy was much stronger in 2021 than in 2020. He said the year just ended was very promising in terms of growth. Even in the previous year, when the world economy contracted at the rate of three and a half percent, our economy grew at around five percent. Based on that success, I believe that last year our growth could be more than seven percent. Although we do not have the complete information, it can be said that we have done well in all areas including agriculture, expatriate income, exports, imports.
It may be mentioned that in the last outgoing fiscal year (2020-21), Bangladesh achieved 5.46 percent GDP growth. In the current fiscal year 2021-22, the growth target has been set at 7.2 percent. However, the World Bank estimates growth at 7.2 percent and the Asian Development Bank (ADB) at 7.8 percent.
This eminent economist thinks that agriculture has always done well. Although the supply of onions and vegetables was slightly disrupted due to rains, the agricultural production at the end of the year was quite satisfactory. Rice stocks are sufficient. However, the price of rice and daily necessities is a bit higher as people have more cash in their hands. The prices of imported commodities have gone up due to higher dollar prices. But not without restraint. Inflation is rising around the world due to the inadequacy of the supply chain. He mentioned that it has also affected Bangladesh.
He added that livelihood opportunities in Bangladesh are also increasing in Corona. The speed of the recovery process is also increasing. If the new type of corona Omicron wave is not too strong, then the recovery of the economy of Bangladesh will continue unabated. And because of that the speed of vaccination has to be maintained. He also advised to keep the booster dose active.
Atiur Rahman mentioned that last year more than five lakh workers went abroad to get job opportunities. News of the opening of the Malaysian market at the end of the year. Britain will take a lot of care-givers. Therefore, it seems that the expatriate income will gain more momentum next year. Exports are doing very well. Lots of new orders arrived. There is a strong public opinion around the world that trade and commerce should not be stopped. So the demand for our export products can be expected to remain positive.
He said import prices had risen by 54 per cent in the first five months of the current financial year from the same period last year. Imports of capital goods increased by 30 percent. The import of yarn has increased by more than one hundred percent.
That means new investment in the industry, he said. As a result, both growth and employment will increase next year.
Analyzing the banking sector, he said that after two years, the growth rate of private sector credit has been 10.11 percent in November. This rate has definitely increased in December. From that, it can be inferred that at the end of the year, business has turned around a lot.
“The benefits of the timely adjustment of monetary policy and fiscal policy under the dynamic leadership of the Prime Minister have begun to fall on our economy,” he said. Despite Corona, the economy has recovered.
He expressed strong hope that Bangladesh’s economy would be at ease in 2022, despite the Corona’s multifaceted challenges.
The foreign exchange reserves set new records as the income of expatriates increased during the Corona Extreme. In August, it surpassed 46 billion. And the news of relief in export earnings was throughout the year, in the fiscal year 2020-21, the growth of export earnings was above 15 percent. Besides, due to the decrease in the incidence of corona at the end of this year, the tourist spots of the country including Cox’s Bazar can be seen overflowing with tourists. As a result, the tourism sector has started to turn around after a two-year hiatus.
Meanwhile, a year has passed through qualitative changes in the capital market. After a long decade, the country’s capital market was dynamic throughout 2021. The country’s stock market has reached new heights in market capitalization and transactions. Major stock market transactions have reached their highest level in the last 10 years due to increased participation of all types of investors at the institutional and individual levels. Similarly, the overall index is increasing in line with the transactions.
Rising share prices, price indices, market capitalization and transactions. In the outgoing year, 13 companies and three bonds listed on the Dhaka Stock Exchange (DSE) have increased their market capitalization by Tk 8,352 crore. With this additional capital, the market capitalization of DSE has increased by Tk 93,096 crore this year and exceeded Tk 5,42,196 crore.
This year, the price-to-earnings ratio (PE ratio) of DSE has increased to 16.58. At the end of last year, the PE ratio was 16.51. Compared to GDP, the market capitalization has increased to 16.01 percent. A total of 14 companies have raised a total capital of Tk 1,233 crore with a premium of Tk 298 crore in the IPO process. At that time the big initiative in the capital market was to launch a separate SME platform or SME board for small capital companies.