Bangladesh slipped two steps to 105th place on the global competitiveness index (GCI) in 2019 as most of its competitiveness indicators fell.
This year the ranking of World Economic Forum (WEF) was made among 141 countries. In 2018, Bangladesh was ranked 103 out of 140 countries.However, the country’s overall score in GCI remained unchanged at 52.1 even though its position slipped.
Local think tank Centre for Policy Dialogue (CPD) unveiled the report on behalf of WEF at a press conference in Dhaka on Wednesday.
Singapore ranked top in the 2019 GCI followed by the USA, Hong Kong, Netherlands, Switzerland, Japan, Germany, Sweden, the UK and Denmark.
Bangladesh’s position eroded in 10 out of 12 pillars, said CPD Research Director Khondaker Golam Moazzem while presenting the Global Competitiveness Report (GCR) 2019.
“The country got bogged down in multifarious problems in terms of compositeness. At one side it has to build infrastructures, while it has to think of creating skilled manpower on the other. There is also problem of good governance,” Dr Moazzem said.
If large scale reforms are not done, it will be tough for the country to become either a higher middle-income or developed country, he cautioned.The 12 pillars include institution, infrastructure, ICT adoption, macroeconomic stability, health, skills, product market, labour market, financial system, market size, business dynamism and innovation capability.
Except for health and product market, Bangladesh slipped on all the pillars, the report said, identifying business dynamism, labour market and skills as the main concerns for the country.
In South Asia, only India and Sri Lanka are ahead of Bangladesh with 68th and 84th positions with score 61.4 and score 57.1 respectively.
Nepal and Pakistan are behind at 108th and 110th positions. Their score is 51.6 and Pakistan 51.4 respectively.
Only Sri Lanka and Nepal moved up one position this year while India slipped 10 notches and Pakistan three notches compared to their 2018 levels.
The index measures the performance of a country’s institutions, policies and other factors that determine its productivity and overall prosperity of its citizens, states World Economic Forum.
At the press conference, CPD also unveiled the findings of the study on ‘The Bangladesh Business Environment Study 2019’ that helped prepare the WEF competitiveness report.
About good governance, 78 percent respondents of the study complained that they had to pay bribe for getting government contracts.
76 percent businessmen surveyed alleged that they had to give bribe for exports and imports, and 74 percent said they were compelled to give bribe while paying taxes.
“Convergence of business and trade in a section of influential people creates monopoly which is not healthy for the economy,” commented Dr Fahmida Khatun, CPD’s executive director.
“If such monopoly exists, small and medium entrepreneurs can’t enter those businesses. And consumers have to buy goods and services at higher cost,” she added.
Bangladesh has to address four key challenges to ensure business-friendly environment and improve its position in GCI, Dr Golam Moazzem said.
At first, Bangladesh should provide more focus on improvement of the governance and institutions, infrastructure, financial system and business operations.
“Lack of preparedness for fourth industrial revolution (4IR) technologies, absence of necessary regulatory framework and skills and no clear pathways for businesses are the emerging concerns,” he said.
The researcher also pointed out that emerging market risks pose additional burden for businesses, like rise in energy price, failure in urban planning, underemployment, failure to climate change adaptation and industrial pollution.
Lastly, he said, Bangladesh should also address the challenge of ensuring macroeconomic stability to make the country as a developed one.