To become 24th largest economy in world by 2033: UK think tank
Bangladesh has been ranked 41st among the world’s largest economies in 2019, moving up two notches from last year’s. The country has become the second biggest economy in South Asia, according to an analysis by a London-based think-tank.
Among the other South Asian countries, India is ranked 5th, Pakistan 44th, Sri Lanka 66th, Nepal 101st, Afghanistan 115th, the Maldives 156th, and Bhutan 166th, in the World Economic League Table, published annually by the Centre for Economics and Business Research (CEBR).
With the United States at the top of the table, China, Japan, Germany and India take the lead as the top five economies.
The report which forecasts the fortunes of 193 countries to 2033 says China is likely to overtake the US as the world’s number one economy in 2032, two years later than previously expected, due to a more lax monetary policy and lower exchange rate.
In the long run, many Asian economies will rise through the ranks of the table as these countries cash in on their demographic dividends.
The two most prominent examples are Bangladesh, which will enter the top 25 largest economies in 24th place in 2033, and Pakistan, which will rise to 27th in 2033, said the report.
“We expect annual rates of GDP growth [in Bangladesh] to average 7 percent between 2018 and 2033. This will see the country climb 19 places in the World Economic League Table to become the world’s 24th largest economy by 2033,” said the report, which was released on December 26.
Bangladesh will rank 36th in 2023 and 27th in 2028.
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According to the report, Bangladesh has benefitted from garments exports, strong increase in remittances, duty free access to the Indian market, domestic consumption expenditure and government spending.
Bangladesh’s economy is expected to have grown by 7.3 percent in 2018, just shy of the 7.4 percent in the previous year. The country has benefitted from a strong increase in remittances in the financial year ending 2018, after declines in the previous two years. Moreover, the export sector benefitted from the duty free access to the Indian market, pushing exports to $375 million in the three months to September.
Indian clothing retailers, as well as global retailers opening Indian outlets, increasingly import from Bangladesh due to the competitive prices of their products.
“Bangladesh’s competitiveness relative to India was further boosted by the introduction of a general sales tax in India, a step that is still outstanding in Bangladesh,” said the 10th edition of the CEBR report.
It, however, warned the country runs the risk of negating gains from its successful export sector through its growing appetite for imports. The current account tipped into a deficit in 2017, and this is expected to widen in 2018, it added.
“The government will also need to explore options on how to increase revenues in order to finance upgrades for infrastructure while maintaining the social safety net.”
The country is further grappling with the Rohingya refugee crisis, the report added.
The CEBR predicts that three of the top five global economies by 2033 will be Asian, with China at the top, India third and Japan fourth position. The US will be second and Germany fifth.
In a statement, CEBR Deputy Chairman Douglas McWilliams said: “The World Economic League Table shows that despite global uncertainty and the tightening in US monetary policy which has pushed down some of the emerging market currencies, the 21st century is still likely to be the Asian century.”
The table gives a ranking of the world’s developed and emerging economies by gross domestic product measured in US dollars at market prices to 2033.