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Bangladesh needs economic diversification, greater public financial resources, a stronger investment climate, and improved governance to nurture its economic resilience and competitiveness, according to the Asian Development Bank (ADB).
The Manila-based multilateral lender made the suggestions in its Annual Report 2024 published on Thursday.
According to the report, the ADB is helping the government enhance its social protection programme via improvements to the policy and regulatory environment.
The report also mentioned that growth in Bangladesh moderated during the latter part of the year as the burden of prolonged inflation was exacerbated by social unrest and political instability, which also resulted in the appointment of an interim government in August.
However, the ADB recently lessened Bangladesh's gross domestic product (GDP) growth forecast to 3.9 per cent for the 2024-25 fiscal year, taking some factors like political instability, high inflation, and a decline in global demand into consideration.
Mentioning that ADB provided holistic support to Bangladesh, the report said the development bank committed a $597.2 million policy-based loan to help boost domestic resource mobilisation and enhance the country's business environment in 2024.
The support aimed at improving tax collection, rationalising public expenditure, simplifying business regulations, promoting a new national logistics policy, and modernising customs processes, the report revealed.
"ADB's support will help bolster Bangladesh's fiscal sustainability, foster greater private investment, and create jobs in new industries," it said.
The ADB is also supporting broad social protection in Bangladesh, where higher energy and commodity prices have pushed many people into poverty.
In 2024, the bank committed a $250 million policy-based loan to help the government of Bangladesh expand its social protection schemes and implement reforms to increase efficiencies and better identify beneficiaries so that those most in need receive adequate support.
In its report, the ADB also stressed the need to take necessary steps in the context of the intensifying impacts of climate change.
Air temperature records were broken in Bangladesh, the Philippines, Thailand, and Vietnam in 2024, it mentioned.
Meanwhile, the ADB deployed almost $40 billion for development across Asia and the Pacific in 2024, the organisation said in a separate press release.
"The ADB committed $24.3 billion from its own resources in 2024, coupled with $14.9 billion in co-financing in collaboration with its partners, to help Asia and the Pacific solve a range of complex development challenges," it said.
"With our increased financial firepower and a sharper strategic focus, ADB is turning commitment into concrete results," the press release quoted ADB President Masato Kanda as saying.
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