WB sees fall in export, remittance
The World Bank said yesterday Bangladesh's export growth might fall by 4.3 percentage points and remittance by 20 percentage points this fiscal year over the last year due to global economic meltdown.
The WB Dhaka office at a press briefing on 'Global financial crisis and its likely impact on Bangladesh' also depicted a probable scenario of the impact of global economic depression on the country's export growth, remittance, balance of payments, budget and GDP.
WB economist Vinaya Swaroop made a keynote presentation at the press briefing, while WB Country Director Xian Zhu was also present.
On the basis of assumption they made different probable scenarios but added that actual situation will be clear by post-Christmas season. Forty percent of the total consumption is done centring the Christmas. As a result whether Bangladesh would get next export order including for apparels depends on that time.
The remittance is likely to fall due to global economic recession, the WB said.
The multi-donor agency projected two possible scenarios for export, import and remittance. In the first scenario the export is projected at $16 billion with a 13.1 percent growth while in the worse case it is $15.7 billion with an 11.6 percent growth.
In the last fiscal year the export was worth $14.1 billion with a 15.9 percent growth. This time the projection was $16.4 billion with a growth of 16.3 percent.
According to the WB projection, in the first scenario import in current fiscal year would be $ 22.2 billion with a 14.1 percent growth, while in the worst scenario it would be $22.7 billion with 9.8 percent growth. Last year the import was worth $19.5 billion that posted a 25.6 percent growth. This year's import target is $23.2 billion with a 19.2 percent growth.
In the current fiscal the WB projected remittance at $9.2 billion with a 16.8 percent growth. In worse case the figure is 8.9 billion dollars with 12.4 percent growth. Last year the remittance inflow was $7.9 billion with a 32.4 percent growth.
In the current fiscal year additional eight lakh people were projected to go abroad. But in the worst case scenario the figure may come down to two to three lakh.
According to worst case scenario, current account balance may fall short of $303 million this fiscal, which was $672 million surplus in last fiscal year.
The global crisis may also have an impact on the government's budget in different ways. Although the government budget fixed total revenue target at Tk Tk 693.8 billion, in the worst case scenario it may drop to Tk 684.6 billion.
In the government expenditure, the target for current fiscal year was Tk 999.6 billion. In worst case, it would fall to Tk 963.2 billion.
Vinaya Swaroop said as the world fuel and food prices fell, the drop in expenditure would minimise subsidy. For the same reason the budget deficit may fall to Tk 278.7 billion from Tk 305.8 billion.
Xian Zhu said the recent decline in international commodity prices is likely to provide policymakers with some fiscal space, which may prove handy in accommodating assistance to sectors adversely affected by the crisis.