Honorable Finance Minister, Planning Minister, ladies and gentlemen, I am deeply honored to join you today to celebrate the 50th anniversary of the Bangladesh-World Bank Group partnership and to reflect on the country's remarkable development successes.
The seeds of our partnership with Bangladesh were sown 50 years ago, when then-World Bank President Robert McNamara flew to the newly independent nation in January 1972 and met with the father of the nation, Bangabandhu Sheikh Mujibur Rahman. In this meeting, a vision was set. Several months later, in August 1972, Bangladesh became a member of the World Bank.
Fifty years later, Bangladesh is one of the world’s greatest development stories.
Bangladesh tells the world a remarkable story of poverty reduction and development: From being one of the poorest nations at its inception, today Bangladesh is one of the fastest-growing economies in the world. Its steady economic growth of over 6 percent per annum since 2000 has lifted millions of people out of poverty. Its GNIpc has increased by a multiple of 21 times since 1972, reaching lower middle-income status in 2015. Bangladesh is now on its way to becoming an upper-middle-income country. The economy has made a strong recovery from the impacts of the COVID-19 pandemic.
Bangladesh made achievements in many areas. I want to highlight three areas as most striking – empowering women and girls; investing in people; and moving decisively on climate adaptation and resilience.
First, the country recognized early on that empowering women is crucial to ending poverty.
In 1991, Bangladesh had one of the lowest educational attainment levels for girls. Now, it is among the few developing countries to have achieved gender parity in school enrollment. Other countries have replicated its innovative Female Stipends Program, which has become a model for bringing girls into school.
Bangladesh reduced fertility rates from 6.1 births per woman in 1971, to 2.1 births in 2018.
Another element of this success is how the ready-made garments industry created jobs for millions of women.
Second, Bangladesh realized early that investing in people is just as critical as investing in infrastructure. A child born in 1972 had a life expectancy of 46.5 years; newborns today are expected to live to more than 70 years. 85 percent of children are fully immunized. Almost all children go to school.
Bangladesh has successfully navigated the COVID-19 pandemic, including an effective vaccination program. We are proud to have supported the government by financing 68 million doses of administered COVID vaccines. It is extremely encouraging to see how seriously Bangladesh is taking its investments in human capital, and this attitude will be decisive as the country is aiming for much higher per capita income levels in the years ahead.
Third, Bangladesh moving on climate adaptation and disaster preparedness. Despite being severely affected by climate change, the country has been a frontrunner in climate adaptation. Thanks to its home-grown approach of early warning systems, a network of cyclone shelters, embankments and afforestation, deaths from cyclones have been reduced 100-fold since Independence. I look forward to visiting a multipurpose cyclone shelter on Tuesday.
I am interested with the model used in Bangladesh, where the cyclone shelters operate as a primary school in normal weather. Bangladesh has instituted disaster risk reduction policies and strategies, and globally, as chair of the Climate Vulnerable Forum for 2020-2022, it helped map out a sustainable and resilient pathway for countries vulnerable to climate change. Many countries could learn lessons from the work done in this area.
Let me also mention something that is highly appreciated by the international community – and that is the country’s solidarity and generosity in times of need for people who suffer and need help. This has been particularly evident for the past five years, Bangladesh has provided shelter to 1.1 million Rohingya who have fled from violence in Myanmar. The World Bank has mobilized - with the help of the Government of Canada - $590 million dollars in grant financing to help Bangladesh meet the basic needs of the host communities and the displaced Rohingya population until their safe and voluntary return to Myanmar. I just want to say thank you for your generosity and assistance.
Looking at our joint history, we are very proud to have been part of this extraordinary journey:
The first World Bank credit to Bangladesh was a US$50 million Emergency Recovery Credit, approved in November 1972. In the ensuing years, Bangladesh became the largest recipient of funding from the World Bank’s International Development Association (IDA), which provides concessional financing, and the World Bank is the country’s largest external funder.
Bangladesh currently has the largest ongoing IDA program of more than US$15 billion. Since 1972, the World Bank has committed about US$39 billion in 362 loans to address the country's development challenges in areas such as infrastructure, human capital development, social protection, rural and urban development, as well as the country’s digital agenda
On top of this, the IFC and MIGA, our private sector arms, provided another 3 billion.
Taken together, these are large sums of money but what is most important is the results this money produced.
This can be seen in the remarkable reduction in poverty and the sustained increase in per capita incomes – and in the vastly improved coverage and quality of education and health services, and infrastructure that is now able to connect effectively the country and is providing a strong platform for its exports worldwide.
Apart from our financing, what makes our partnership unique is our presence in the country, that allows us to work on a daily basis with you. We are very proud to have an incredible set of Bangladeshis working in our office helping their country advance.
And most importantly, it fosters dialogue. We have a wonderful program of analytical studies and technical assistance that started with major studies in 1972 on the economy and the recovery of the devastated economy, to more recently Country Economic Memorandum and a Country Climate and Development report that discusses the climate challenges of the country and the options available for addressing them while pursuing growth.
How can Bangladesh reach the next level of development?
In preparing for this visit, I liked very much the country’s vision to double its per capita income by 2031 and in this way become and upper middle-income country. This is a very clear vision that will provide focus on what will be required to reach this. And that means continued reforms to strengthen institutions so that they can serve the needs of an economy of higher-income level.
As a long-standing partner, we will support Bangladesh as it navigates through challenging and uncertain economic times brought on by the COVID-19 pandemic, the war in Ukraine and the heighted climate challenges.
Bangladesh can achieve long-term growth by strengthening reforms in the areas of macro-fiscal management, export diversification, financial sector, energy, and climate resilience.
Let me elaborate further on these areas:
- Higher and sustained levels of infrastructure investment, digitalization and especially human capital will be a sine qua non for higher growth.
- A vibrant private sector and export diversification will be central for staying on course for a strong growth path. For this, rationalizing the tariff system to reduce the nominal protection rate, removing non-tariff barriers, and liberalizing trade in services will be critically important. And, you have already shown potential to do this. In 1970, Bangladesh had $500 million in export revenues. This has grown, with exports revenue for the month of November 2022 alone reaching $5 billion dollars!
- To sustain rapid private sector-led growth, Bangladesh will need to deepen and diversify its financial sector. This would help increase the economy’s resilience and mobilize additional resources for small and medium enterprises, many of which are currently not able to access the credit to upgrade their facilities and grow their business.
- Bangladesh has led the way in climate adaptation and disaster risk management. Yet, it continues to face severe and increasing climate risks. Our recent Country Climate and Development Report proposes a roadmap of targeted policy and investment interventions for a low-carbon growth path, including among others the development of a climate smart agricultural system, the prioritization, resourcing and implementation of the Bangladesh Delta Plan 2100, and the adoption of energy efficiency measures and reduced subsidies to save fiscal resources and reduce carbon emissions.
- Last but not least, to safeguard the country’s successful development outcomes and support sustained growth and poverty reduction, it is important that the country maintain stable macroeconomic conditions, underpinned by sound macroeconomic-fiscal management. The World Bank stands ready to support Bangladesh on these critical reform areas which timely implementation will set Bangladesh on a path to high-income country.
Honorable Finance Minister, Planning Minister, ladies and gentlemen:
This celebration is for the people of Bangladesh. We must remember that the country's remarkable journey is embedded in the energy and resilience of its people.
Bangladesh and the World Bank will work together, as we have for half a century, to help the country continue to be a model of green, resilient and inclusive development. Our partnership is one of ambition and passion to help create a more prosperous and better future for all Bangladeshis.