Bangladesh : macroeconomic assessment

This report presents a macroeconomic assessment of the country. Successive sections: (1) review macroeconomic trends in the areas of domestic product and prices, savings and investment, employment, the fiscal sector, and balance of payments; (2) trace the evolution of the country"s policy environment in regard to food and agriculture, industry and trade, stabilization, and structural adjustment; (3) analyze Bangladesh"s economic performance in terms of private investment, capital productivity, capacity utilization, labor productivity, and income distribution and poverty; and (4) identify major constraints and issues involved in implementing effective economic policy. Analysis of two possible scenarios for economic growth through the year 2000 results in several major projections. Current trends in investment financing, foreign trade, and GDP growth (3.8%) will lead to increasing deficits in the balance of payments by FY96. Even with a target GDP growth rate of 5.2%, balance of payments deficits will occur as of FY92. Furthermore, in the case of 5.2% growth, the level of gross international reserves will reach negative levels by FY97 and would attain clearly unfeasible negative values before 2000. The final section of the report presents recommendations for A.I.D. assistance to Bangladesh, with a major focus on investment in education, training, and skills development.