FHM HUMAYAN KABIR |
07 Aug 2021 08:11:20
Aug 07, 2021 8:30:02 AM
After more than a decade, Bangladesh’s industrial growth collapsed in the 2019-2020 fiscal year, alongside the contraction of the country’s total economic output during the year, analysts said on Friday.
A rebound is still slow, they maintained.
Agriculture, conversely, saved the day as higher agricultural growth cushioned the decline in production and absorbed many unemployed people as the coronavirus pandemic turned lives and livelihoods disruptive.
According to final data from the Bangladesh Bureau of Statistics (BBS), the growth rate of gross domestic product (GDP) driven by the country’s main engine industry fell to 3.25%, nearly a quarter of that of the 2019 financial year.
Likewise, the rate of the second growth engine – the service sector – had also plunged to 4.16% in fiscal 2020 from its rebound rate of 6.78% in fiscal 2019. , according to official data.
At the same time, the dynamic growth rate of the agricultural sector in the previous fiscal year 2020 helped revive the overall economic production rate to 3.51% before falling back into a negative trajectory.
Most of the world’s economies, except 21, were in negative growth dynamics in fiscal 2020 under the devastating impact of the Covid-19 pandemic.
Prior to the viral invasion in 2020, Bangladesh’s economy had grown at an impressive rate of 8.15% in fiscal 2019.
Analysts observe that while the pandemic has hit the country’s industrial and service sectors hard following anti-corona lockdowns – at home and around the world – agriculture has worked just the opposite over the course of the past decade. fiscal year 2020, exceeding its growth rate of the previous fiscal year.
In fiscal year 2020, the country’s agricultural growth rate was recorded at 4.59 percent, 0.67 percentage point higher than the previous fiscal year.
Previously, the growth of the agricultural sector had almost maintained a slowdown during the last decade in a period of contraction.
Meanwhile, BBS’s provisional estimate of GDP in the last fiscal year 2021 showed a slight upturn in industrial growth, as the country’s main growth driver grew 6.12%.
Growth in the service sector also rebounded slightly to 5.61 percent in fiscal 2021, from 4.16 percent in the previous fiscal year, according to BBS data.
Agriculture’s growth rate, however, fell to 3.45 percent in the last fiscal year 2021, from an impressive 4.59 percent the year before (fiscal 2020).
Center for Policy Dialogue (CPD) research director Dr Khondaker Golam Moazzem told FE that higher growth in agriculture not only cushioned some shocks, but also absorbed many workers who had lost their jobs due to the impact of Covid.
With agriculture still being the biggest job creator (41%) in Bangladesh, it provided work for some newly unemployed who returned from urban areas to villages as part of reverse migration, he said. he noted.
Bangladesh’s economic growth is expected to be on a lower trajectory in FY2020, as most of the world’s economies, except only 21, were on a negative trajectory. Bangladesh is in luck. He entered the Lucky 21 club with his growth of 3.51%, “said Dr Moazzem.
It is good news that the country has recovered somewhat from the shocks of the last fiscal year 2021, although SMEs (small and medium-sized enterprises) and the crops and horticulture sub-sectors maintained the worst state, he added.
The economics researcher said: “In fact, the 3R rice, remittances and RMG have helped us recover in the last fiscal year 2021 from a massive collapse in fiscal year 2020.”
Dr Moazzem said that while the service sector has not declined significantly in the last fiscal year 2021 from the pre-Covid level, many micro and small SMEs may not be listed in the calculation of the GDP.
“So this growth dynamic did not tell the real scenario of employment in the service sector. Many people in the informal sector had already fallen into poverty. In this case, the government should have proactive measures to people who go beyond the growth momentum of the service sector. “
Dr Moazzem said the government should keep in mind that although the GDP growth rate recovered slightly in the last fiscal year 2021 compared to that of the previous fiscal year, the country’s economic scenario was still lower than the level before the crown.