DHAKA: World Bank predicted Bangladesh growth may dip as much as 1.5 percentage point to fall at 5.7 percent, down from a government projection of 7.2 percent for fiscal 2013-14 due to ongoing political stalemate.

The global lender came up with observation on a half-yearly report titled ‘Global Economic Prospects’ on Wednesday.

The WB forecasted that Bangladesh growth would be fall below six percent current fiscal due to political instability centering the national elections.

The bank published economic forecast of several south asian countries including Bangladesh. In its latest Global Economic Prospects report, it said developing countries regain strength after two weak years.

Developing-country growth is also firming, thanks in part to the recovery in high-income economies as well as moderating, but still strong, growth in China, it added.

Growth prospects for 2014 are, however, sensitive to the tapering of monetary stimulus in the United States, which began earlier this month, and to the structural shifts taking place in China’s economy.

The report forecasts growth in developing countries to pick up from 4.8 percent in 2013 to a slower than previously expected 5.3 percent this year, 5.5 percent in 2015 and 5.7 percent in 2016. While the pace is about 2.2 percentage points lower than during the boom period of 2003-07, the slower growth is not a cause for concern. Almost all of the difference reflects a cooling off of the unsustainable turbo-charged pre-crisis growth, with very little due to an easing of growth potential in developing countries. Moreover, even this slower growth represents a substantial (60 percent) improvement compared with growth in the 1980s and early 1990s.

Global GDP is projected to grow from 2.4 percent in 2013 to 3.2 percent this year, stabilizing at 3.4 percent and 3.5 percent in 2015 and 2016, respectively, with much of the initial acceleration reflecting a pick-up in high-income economies.

“Global economic indicators show improvement. But one does not have to be especially astute to see there are dangers that lurk beneath the surface. The Euro Area is out of recession but per capita incomes are still declining in several countries. We expect developing country growth to rise above 5 percent in 2014, with some countries doing considerably better, with Angola at 8 percent, China 7.7 percent, and India at 6.2 percent. But it is important to avoid policy stasis so that the green shoots don`t turn into brown stubble,” said Kaushik Basu, Senior Vice President and Chief Economist at the World Bank.

BDST: 1322 HRS, JAN 15, 2014
Edited by: Rubaiat Saky, Senior Newsroom Editor