The economy of Bangladesh is expected to grow by 6.4 percent in the current fiscal year (FY18) driven by industry and services, said the World Bank in its latest Bangladesh Development Update, UNB reports.
"Through strong macro-structural policy reform and well-coordinated implementation, Bangladesh can accelerate growth, reduce poverty and boost shared prosperity," said the World Bank update released Wednesday at its Dhaka office.
Earlier on Tuesday, the Asian Development Bank (ADB) projected 6.9 percent GDP growth for the current fiscal year in its Asian Development Outlook 2017 Update down from the government's GDP growth projection of 7.4 percent.
Listing some of major challenges and structural reforms that the country has to face in the near future, the Update said, "Bangladesh still has a long road ahead. Large infrastructure projects have progressed in FY17, but key reforms in taxation and the financial sector have stagnated."
It said that excess liquidity and non-performing loans (NPLs) in banks pose risks to macroeconomic stability.
"Both private and public investment is necessary for increasing productivity and employment. The country must take advantage of the global recovery to undertake institutional and market reforms, which can help sustain growth in the long term."
World Bank Country Director Qimiao Fan spoke on the occasion while Lead Country economist Zahid Hussain made the key-note presentation.
The Update said that export growth is likely to pick up modestly with the expected recovery in global trade while remittances may turnaround and private investments may pick up.
The World Bank's Development Update said that the inflation is expected to be high by 6 percent.
"Severe monsoon flooding has adversely affected the livelihood of over 8 million people in 32 districts, as well as rice production. As a result, the price of coarse rice remains volatile along with factors like policy indecisiveness, increased prices in India, Vietnam, Thailand and speculative hoarding."