ADB cuts Bangladesh’s growth forecast to 4.7pc amid weak exports

Although South Asia’s economic growth projection has been upgraded, the Asian Development Bank (ADB) has revised down Bangladesh’s growth outlook to 4.7 per cent for the current fiscal year (FY) 2025-26.

In its previous Asian Development Outlook (ADO), the ADB had forecast Bangladesh’s growth at 5.0 per cent, which has now been revised down in its updated version released on Wednesday.

Bangladesh’s economic growth outlook for FY2026 has been cut to 4.7 per cent from 5.0 per cent in the September ADO, the ADB said in its ADO December 2025, unveiled on Wednesday from its headquarters.

The lowered forecast is attributed to several significant headwinds, including weaker-than-expected export performance and heightened investment uncertainty stemming from anticipated policy effects related to the upcoming national elections scheduled for February.

The reduced projection also reflects continued weaknesses in the financial sector.

Exports, a key component of the economy, have faced considerable pressure due to subdued global demand and internal supply disruptions. A major factor was a strike in October at Chittagong Port, which severely hampered trade flows, as the facility handles more than 90 per cent of Bangladesh’s imports and exports, the ADB said.

Despite the downgrade in the FY2026 growth projection, the inflation forecast for Bangladesh remains unchanged at 8.0 per cent.

This stability is based on the assumption that the government will maintain tighter monetary and fiscal policies. Additionally, ongoing efforts to reduce exchange rate volatility and the beneficial impact of declining global commodity prices are expected to keep the inflation outlook steady, it said.

It is noted that while the forecast for FY2026 has been lowered, the country’s growth outlook for the current fiscal year, FY2025, remains unchanged from previous projections of 4.0 per cent.

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