Bangladesh needs higher and sustainable levels of infrastructure investment, digitization, human capital particularly in education, health and social protection to reach the next high of development after graduation, the World Bank suggests.
While reassuring their development assistance Sunday, World Bank managing director Axel van Trotsenburg also stressed vibrant private sector, export diversification and deepening and diversifying its financial sector.
"Bangladesh has made tremendous strides, transforming from one of the world's poorest countries at independence in 1971 to a lower-middle-income country in 2015," he said, reassuring the World Bank's unflinching support to Bangladesh in its development drive.
Bangladesh is now on its way to becoming an upper-middle-income country and its economy has made a strong recovery from the impacts of the COVID-19 pandemic.
The country made achievements in many areas, he said, highlighting three areas as most striking: empowering women and girls, investing in people, and moving decisively on climate adaptation and resilience.
The visiting WB top official was speaking at a press conference after he joined the celebration to mark the 50 years of partnership between Bangladesh and the World Bank, along with Finance Minister AHM Mustafa Kamal and World Bank Vice President for South Asia Martin Raiser and its country director for Bangladesh and Bhutan Abdoulaye Seck, at Bangabandhu International Conference Center.
They inaugurated a photo exhibition depicting the country's remarkable progress over the past five decades and joined a panel discussion. The events provided an opportunity to recognize the country's remarkable development achievements and to look forward to realizing the country's vision to become an upper-middle-income country by 2031.
"Bangladesh, as many other countries in the world, is coping with unprecedented global shocks," said Mr Trotsenburg.
"We are committed to supporting the country through uncertainties and challenges created by the COVID-19 pandemic, the Russian invasion of Ukraine, and increasing impacts of climate change as the country moves forward to achieve its development goals."
The country can achieve long-term growth by strengthening reforms in the areas of macro-fiscal management, export diversification, financial sector, energy, and climate resilience.
For a vibrant private sector and export diversification, he recommended rationalizing the tariff system to reduce the nominal protection rate, removing non-tariff barriers, and liberalizing trade in services.
"Bangladesh will need to deepen and diversify its financial sector. This would help increase the economy's resilience and mobilize additional resources for small and medium enterprises, many of which are currently not able to access the credit to upgrade their facilities and grow their business to sustain rapid private sector-led growth."
To safeguard the country's successful development outcomes and support sustained growth and poverty reduction, it is important that the country maintain stable macroeconomic conditions, underpinned by sound macroeconomic-fiscal management, he told the press, assuring the World Bank's support to the country on these critical reform areas whose timely implementation will set Bangladesh on a path to high-income country.
Regarding climate adaptation and disaster risk management, he said Bangladesh has led the way in these regards though, yet it continues to face severe and increasing climate risks.
Replying to a question over pulling out World Bank's financing from the Padma Bridge construction, Mr Trotsenburg, however, did not respond directly.
Terming the answer 'affirmative' he also said out of 362 projects one might not be successful and "in family one might have different opinions".
Responding to another question over Rohinga, he said Bangladesh has provided shelter to 1.1 million Rohingya who have fled from violence in Myanmar and the World Bank has mobilized US$590 million in grant financing to help Bangladesh to deal with it
Terming Bangladesh the largest recipient of funding from the World Bank's International Development Association (IDA), he said Bangladesh currently has the largest ongoing IDA program of more than US$15 billion.
Since 1972, the World Bank has committed about US$39 billion in 362 loans to address the country's development challenges in areas such as infrastructure, human capital development, social protection, rural and urban development, as well as the country's digital agenda.
On top of this, the IFC and MIGA provided another 3.0 billion.
Speaking at the celebration programme, the finance minister sought cooperation from all development partners, including the World Bank, in achieving the country's target to become upper- middle-income and a smart developed country by 2031 and 2041.
"Bangladesh's growth has increased by 74 times since 1972, and the World Bank had a role to play behind it," he said.
He said Bangladesh is currently the 35th-largest economy, and the poverty rate has come down to 20 per cent, per-capita income increased to $2,824 and average life expectancy increased to 73 years.
Economic Relations Division secretary Sharifa Khan sought budgetary support to address challenges, saying geopolitical crisis resulted in global crisis of food, energy, high inflation, rise in cost of borrowing for which Bangladesh is not responsible but are being affected.