Bangladesh (Common Wealth) _According to World Economics’ most recent research, Bangladesh’s GDP in Purchasing Power Parity (PPP) terms will be $1.577 trillion at the end of 2023, with extra estimates for the size of the informal sector and adjustments for out-of-date GDP base year.
Bangladesh will be ahead of Australia (10th) and Pakistan (11th) in the Asia-Pacific area with this massive formal and growing informal/shadow economy by 2022. The research predicts that this will continue even until 2023.
World Economics predicts that Bangladesh would surpass Poland, Taiwan, and Vietnam in GDP terms within the next decade (2020-2030). Bangladesh has the fastest-growing economy in the Asia-Pacific region, according to World Economics’ most recent assessment (as of June 2023).
It stated that if the GDP growth rate projected by Bangladesh’s official data is correct and trends from the previous decade continue, the country could conceivably exceed Poland, Taiwan, and Vietnam in GDP terms within the decade.
It is also highlighted that the GDP growth data for June is just as untrustworthy as the annual data, therefore ‘caveat emptor’ applies to this criterion. However, World Economics announced earlier in 2017 that its PPP prediction for Bangladesh’s GDP at the end of 2022 was $1.074 trillion. World Economics expects Bangladesh’s GDP will be $1.495 trillion in its most recent study (June 2023), which is 39% more than government estimates.
According to the report, Bangladesh’s informal economy is estimated to be 30.2% of GDP, or nearly $324 billion in GDP per capita based on PPP levels. Bangladesh’s GDP is the 25th largest in the world, the ninth largest in the Asia-Pacific region, and the fourth largest in the Frontier Markets, according to the current estimate.
Despite the fact that Bangladesh’s shadow economy is expanding, the country ranks 16th in the Asia-Pacific region in terms of informal economy size as a proportion of GDP growth, trailing India (4th, 43.1%), Pakistan (8th, 35.6%), and Australia (31st, 9.9%). According to the authors, this forecast (2023 data) is based on IMF growth rate estimates applied to World Economics GDP data. However, economists remain skeptical about the data’s veracity.
Former World Bank Bangladesh chief economist Zahid Hussain told the Dhaka Tribune, “Informal economy is not taken into account in formal economic calculations, but they have calculated the informal economy here.” However, our labor opportunities are dwindling. It has only increased in the agricultural sector. So I’m not sure how they offer such a rosy picture because they didn’t provide the data source they used.”
The image offered by World Economics is very optimistic, but if this occurs, it will be wonderful news for the country; however, it appears to me to be a mystery increase, he continued. Similar comments were expressed by Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh (PRI). “I don’t understand how they calculated it,” he told the Dhaka Tribune.
But, if this is true and continues, we may be able to go forward while leaving many countries behind, the former IMF official added. However, according to a tentative estimate published by the Bangladesh Bureau of Statistics (BBS) on May 16, 2023, Bangladesh’s GDP size at the end of FY23 is $453.852 billion, or Tk44.392733 trillion in current prices.
An informal economy (or shadow economy) is any economy that is not taxed or regulated by the government. The informal sector accounts for a bigger proportion of the poorer, more agrarian, and less sophisticated economies. However, in Least Developed Countries such as Bangladesh, the informal or shadow economy plays a vital role in both job creation and the manufacturing and distribution of products and services. However, because informal sector enterprises are typically small and unregistered, statistical authorities confront significant challenges in estimating economic activity linked with informality. The informal economy includes jobs as diverse as minibus drivers, home workers, and hawkers at traffic lights.
