Bangladesh’s economy is progressing rapidly, despite a considerable gap in income equality, but the governance indicators have been on a steep decline since 2022, as shown in a report by World Economics published in June earlier this year.
The report provides a more realistic view of Bangladesh’s economy, but experts caution that this may be challenging in a country facing significant governance and corruption issues.
According to World Economics, Bangladesh is ranked 122nd globally, 19th in the Asia-Pacific region, and 25th among Frontier Markets for governance.
In the last three reports, there has been a focus on Bangladesh’s strong economic growth.
However, recent reports have shed light on aspects like governance and income equality in the country.
The report emphasizes that despite the high but uncertain GDP per capita growth rate, Bangladesh continues to be classified as a poor country.
The data in the report is based on various sources, including the World Bank (Rule of Law), RSF (Press Freedom), Freedom House (Political Rights), and Transparency International (Corruption Perceptions) reports.
Bangladesh’s scores for Data Grade, Global/Regional or Asia-Pacific Ranks, Governance Index, Rule of Law, Press Freedom, Political Rights, and Corruption scale are E, 125/20, 24, 38.8, 39.5, 41.9, and 27.8 respectively.
Data has been indexed on a scale of 0-100 for comparison purposes. where 0 = bad and 100 = as good as it gets.
The report also said evidence from “light” research (North Korea is dark at night, whereas South Korea is brightly lit) suggests that economic data from authoritarian countries with very low governance levels such as Bangladesh, usually exaggerate wealth, by some 30%+ on average.
Income inequality
Bangladesh is not as bad in the income inequality index as governance.
Bangladesh ranks 37th globally, ninth for the Asia Pacific region and seventh in the frontier markets for inequality.
World Economics has Indexed the Gini Coefficient in relation to each country for comparison purposes.
Regarding the Inequality index, the report said that the distribution of income in an economy can be measured on a country-by-country basis by the Gini Coefficient. Gini values are not all up-to-date but in the case of Bangladesh, the data relates to 2016.
“I have considerable doubts about the credibility of the data,” Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh (PRI), told Dhaka Tribune.
“I don’t understand how they calculated it,” the former IMF official added.
“Yes, the growth they have shown, if this has really happened and is continuous, then it is possible for us to move forward, leaving many countries behind. But income inequality and governance indices worry me a lot”.
The World Economics report also said in previous reports published in Dhaka Tribune that Bangladesh’s GDP indicated that the economy was some 39% larger than official estimates and was the fourth largest economy in the Frontier market group, the 10th largest in the Asia-Pacific region, and the 25th largest in the world.
If the GDP growth rate suggested by Bangladesh’s official data can be relied upon, and trends of the last decade continue, the country could theoretically overtake, in GDP terms, Poland, Taiwan and Vietnam within the decade.
Source : DhakaTribune
