Bangladesh has very few options other than pursuing a strong export-oriented growth strategy, said former finance adviser Mirza Azizul Islam, rejecting an UNCTAD warning of potential crisis from adopting export-led growth strategy.
Dr. Islam made this comment after the publication of UNCTAD's Trade and Development Report 2010 (TDR) subtitled "Employment, globalisation and development", released Tuesday.
In TDR 2010, UNCTAD warns that developing countries should rethink their policies in support of sustained economic progress if their current strategies for achieving growth and creating employment count heavily on expanding exports.
TDR observes that export-led growth ambitions will face increasing constraints now that the debt-financed consumption boom in the United States has ended.
"Our current level of high consumption, low exports, low investment and high import dependence is compelling itself to focus more on export", Dr. Islam told the FE.
"Bangladesh had the third lowest investment/GDP ratio (24 per cent) among seven Asian countries with large population. "To achieve the GDP growth of 8.0 per cent by 2015, the country has to raise the ratio to approximately 32 per cent, Dr. Islam pointed out.
"This means Bangladesh has to lower its consumption/GDP ratio and increase the import/GDP ratio which will require enhanced exports", Dr. Islam said.
Enhancing domestic demand may be a solution for China, India, Indonesia, Thailand and Vietnam as these countries have lower levels of consumption and higher levels of investment, exports and per capita income.
"There is little scope for redirecting export to domestic market as per capita income is very low in Bangladesh", he added.
Business / শিল্প-বাণিজ্য
'Country has very few options' other than raising exports
September 14th, 2010229 views