IMF sees 6pc GDP growth in Bangladesh in FY24

A participant stands near a logo of IMF at the International Monetary Fund - World Bank Annual Meeting 2018 in Nusa Dua, Bali, Indonesia, 12 October 2018.
Reuters file photo

The International Monetary Fund (IMF) has projected a 6 per cent growth rate for gross domestic product (GDP) in Bangladesh for the current fiscal year.

In a latest report titled World Economic Outlook, the global lender also anticipated that the growth will continue, reaching 6 per cent in 2024 and 7 per cent in 2028.

However, the projection differs significantly from earlier assessments by other organisations.

In September, the Asian Development Bank (ADB) predicted an economic growth of 6.5 per cent in Bangladesh for the fiscal year 2023-24, while the World Bank recently suggested a more conservative estimate of 5.6 per cent for the current fiscal year.

In contrast, the government has set an ambitious growth target of 7.5 per cent for the current financial year 2023-24.

The IMF expects a gradual decline in inflation, forecasting it to decrease from 9 per cent in 2022-23 to 7.9 per cent in the fiscal year 2023-24 and further drop to 5.5 per cent by 2028.

The current account deficit is expected to persist. The IMF said the deficit, which was 0.7 per cent of GDP in the fiscal year 2022-23, is expected to rise slightly to 0.8 per cent in the fiscal year 2023-24.

Regarding the global economic situation, the IMF report said the global economy continues to recover slowly from the blows of the pandemic, Russia’s invasion of Ukraine, and the cost-of-living crisis. In retrospect, the resilience has been remarkable.

Despite the disruption in energy and food markets caused by the war, and the unprecedented tightening of global monetary conditions to combat decades-high inflation, the global economy has slowed, but not stalled. Yet growth remains slow and uneven, with growing global divergences. The global economy is limping along, not sprinting, it noted.

According to the IMF projections, global growth will slow from 3.5 per cent in 2022 to 3 per cent this year and 2.9 percent next year, a 0.1 percentage point downgrade for 2024 from the July projections. It remains well below the historical average.

Headline inflation continues to decelerate, from 9.2 per cent in 2022, on a year-over-year basis, to 5.9 per cent this year and 4.8 per cent in 2024. Core inflation, excluding food and energy prices, is also projected to decline, albeit more gradually than headline inflation, to 4.5 percent in 2024.