WB to help Bangladesh remove barriers to growth

The World Bank Group yesterday endorsed the new country partnership framework (CPF) for 2016-2020, focusing on the Group’s technical and financial assistance to Bangladesh in three areas.

“The CPF will help Bangladesh achieve its vision of reaching the middle income country status by 2021 from the current status of a lower middle income nation,” the WB said in a statement.

Bangladesh achieved the status of a lower middle income country in 2015. The country is at an important juncture, and with right policies and timely action, it can move up within the middle income bracket. For that, Bangladesh will need to accelerate growth, the WB said.

The lender’s first priority will be to help Bangladesh remove bottlenecks to growth, shift more financing to increasing electricity supplies and improve transport connectivity.

The WB will also assist the country in expanding financial intermediation and increasing the ease of doing business.

Fostering social inclusion will be the bank’s second priority area, which will build on Bangladesh’s impressive gains in human and social development.

It will continue to support improving the quality and access to education and skills development, scale up health services, and widen access to clean drinking water and sanitation.

The WB will also support expanding social protection and help the poor get better jobs at home and abroad.

The bank will lay emphasis on financing climate and environmental management.

The statement said the bank's support will be aligned with the “adaptive delta management” principle, with the aim to enhance Bangladesh's resilience to natural disasters, improving water and natural resource management and modernising agriculture.

In the first year of the CPF, Bangladesh is going to get $1.3 billion in assistance from the WB which was $1.9 billion last fiscal year.

A WB official said the amount of assistance to be given in the coming years will be decided later. In the new CPF period, overall assistance to Bangladesh will increase compared to that in the previous five years, the official added.

The new CPF will help Bangladesh create more and better jobs for the 2.1 million youths entering the job market every year, said the statement.

It said the World Bank Group identified job creation as a prerequisite for reducing poverty and accelerating growth in Bangladesh. It will help the country address key impediments to higher and sustainable growth.

The CPF is aligned with the

government's seventh five-year plan and the WB's systematic country diagnostic (SCD) for Bangladesh, which offers a comprehensive analysis of the country's development challenges.

The SCD identified five transformational priorities where a concerted effort could have the greatest impact on sustainable growth and job creation in the next three to five years -- energy, inland connectivity, regional and global integration, urbanisation, and adaptive delta management.

"Despite daunting challenges, Bangladesh has made remarkable progress in reducing poverty and advancing growth and development. But the country can do better," said Qimiao Fan, the WB's country director for Bangladesh, Bhutan and Nepal.

For Bangladesh, job creation tops the development agenda and this requires higher, sustainable growth. The WB will help remove barriers to growth, he said.

“We will help the country expand access to electricity and transportation, deal with climate change, and continue to improve on human and social development.”

The WB board yesterday also approved $130 million in additional financing to the “private sector development support project” to increase assistance to new economic zones in Bangladesh, as well as $50 million for the “pro-poor slums integration project” to pilot a community-based approach to improve living conditions in urban slums.

The WB says Bangladesh is the largest recipient of funding from the World Bank Group's International Development Association (IDA), which provides financing to the world's poorest countries. To date, the IDA has provided about $20 billion in development assistance since the early 1970s.

The CPF expands collaboration between Bangladesh and Bank Group institutions: financing will include soft loans and grants to the government from IDA, private-sector financing from the International Finance Corporation, and investment insurance from the Multilateral Investment Guarantee Agency.

The IFC provides a combination of investments and advisory services for sustainable private sector development in Bangladesh by investing in critical infrastructure, building competitiveness in priority sectors such as textiles and promoting financial inclusion.

"The IFC will help Bangladesh improve its competitiveness and increase foreign and domestic private investment in the country,” said Wendy Werner, IFC country manager for Bangladesh, Bhutan and Nepal.

 “The IFC will grow its portfolio in infrastructure, high value manufacturing, and agribusiness while continuing our advisory interventions to improve environmental and social standards, energy and resource efficiency, corporate governance and facilitate investment climate reforms."