Honorable Prime Minister, once again, a very warm welcome to you, the members of Cabinet and other members of your delegation. I am also delighted to welcome both World Bank staff currently working on Bangladesh and former World Bank Country Directors for Bangladesh.
We are honored by your visit to celebrate the 50th anniversary of the Bangladesh-World Bank Group partnership. Bangladesh’s story is a story of ambition and resilience. We have witnessed consistently how the country has been able to transform and overcome pressing challenges, most recently during the COVID-19 pandemic. We recognize your enormous contribution to take Bangladesh out of conflict and fragility.
From the very beginning, the World Bank has been a steadfast partner in Bangladesh’s development journey. In February 1972, shortly after Independence, Robert McNamara, the World Bank president at the time, flew to Dhaka and met with the Honorable Prime Minister’s father, the Father of the Nation, Bangabandhu Sheikh Mujibur Rahman.
In August 1972, Bangladesh became a member of the World Bank. The Bank’s first report “Bangladesh - Reconstructing the Economy”, in September 1972, noted the enormous challenges facing the young nation in the wake of the devastations from the war for independence. Our first IDA credits, approved in October and November 1972 and amounting to US$110 million, helped with irrigation to create the basis for food security; cyclone rehabilitation in the aftermath of the devastating Cyclone Bhola; and overall rehabilitation to rebuild the transport, agriculture, communication, and industrial sectors.
We welcome and applaud its progress in income growth and poverty reduction. Between 2000 and 2016, extreme poverty dropped from 34 percent to 13 percent.
Throughout, the World Bank has been Bangladesh’s largest development partner. IDA has committed about US$40 billion in financing in the form of grants, interest-free loans, and concessional credits. With more than US$16.3 billion commitment in ongoing programs, Bangladesh currently implements the largest IDA country program globally. IFC and MIGA, our private sector arms, have provided another US$3 billion over the years. We are committed to continuing our support to enable the private sector, create new job opportunities, broaden the tax base, strengthen the financial sector, and build the country’s resilience to economic and climate shocks.
Three lessons stand out from Bangladesh’s development experience and can inspire other countries: empowering women and girls, investing in people and connectivity, and moving decisively on climate adaptation and resilience.
First, Bangladesh was quick to recognize that empowering women is crucial to ending poverty. Helped by family planning, fertility rates fell dramatically -- from 6 births per woman in 1971 to 2 births in 2018. The ready-made garments industry created jobs for millions of women, boosting family incomes. Bangladesh pioneered the first conditional cash transfers to encourage school attendance. Its innovative Female Stipends Program has become a model for enrolling girls in school – and keeping them there. With more than 8 million girls in secondary schools in 2018, Bangladesh is now among the few countries that has achieved gender parity in school enrollment.
Second, Bangladesh started early to invest in people as part of its development strategy. Today, roads connect the most remote corners, and electricity reaches almost all homes. A child born in 1972 had a life expectancy of 46.5 years. Newborns today are expected to live for more than 70 years. Today, 85 percent of children are fully immunized, and key health indicators such as child and maternal mortality have dropped significantly.
Third, the country has been a frontrunner in climate adaptation. In 1972, the first IDA project approved for Bangladesh helped build embankments and early warning systems. Subsequently, the Bank financed the construction and rehabilitation of more than 1,000 cyclone shelters that also serve as primary schools, and the repair of 700 kilometers of coastal embankments. Cyclone-related fatalities have fallen 100-fold over the past thirty years.
Honorable Prime Minister, this leadership on climate challenges is inspiring.
Let me at this point also thank the Honorable Prime Minister and the Bangladeshi people for hosting the displaced Rohingya people. Bangladesh’s provision of shelter to more than 1.1 million Rohingya who fled from violence in Myanmar since 2017 saved thousands of lives. We will continue to work with you in providing support to the Rohingya. The World Bank has mobilized US$590 million in grant financing, with support from Canada and in close collaboration with the UN family and others, to help provide local communities in Cox’s Bazar, and the displaced Rohingya population, with health care, education, basic services, and infrastructure. Several steps can improve the sustainability and impact of the programs: enhanced livelihood and education opportunities, resilient shelters, stronger inclusion of the Rohingyas into the national systems for service delivery, and leveraging government investments on the island of Bhasan Char.
Ladies and gentlemen, our celebrations take place at a time of great concern in the world economy. Despite its strong track record of resilience, Bangladesh has suffered during multiple crises. As we look forward, several priority reforms can help sustain rapid growth and development:
Improving the business environment and simplifying and lowering import tariffs, particularly of intermediate goods, will encourage foreign investment, boost the competitiveness of domestic companies, and facilitate access to new export markets. Modernizing FDI and foreign exchange regulations is an urgent policy priority. Added competitiveness will be increasingly important as Bangladesh approaches its graduation from LDC status.
Trade environment globally is facing difficulties and it’s vital that countries avoid self-sufficiency, new wave of protectionism, subsidies, and local content requirements. To maintain competitiveness, there needs to be predictability and a forward movement on trade liberalization. Bangladesh can play an important role in regional connectivity for trade with India, Bhutan and Nepal.
Financial sector reforms will help Bangladesh scale up domestic private investment. Improving governance of the financial sector is critical and should be part of our partnership going forward. Capital market development is a critical part of the process and incorporating international good practices in banking legislation can help reduce financial sector vulnerabilities. IFC is working with the Government on NPL resolution by providing necessary inputs for the amendment of Bangladesh Asset Management Company Act Bill, conducting a deep dive to understand overall NPL volume & distribution, applicable investment structure and transferability of loans.
At the same time, given substantial public investment needs in infrastructure, human capital and climate resilience, mobilizing domestic resources will be critical to complement international development assistance. This requires reducing tax exemptions – which represent around 2 percent of GDP –, simplifying the tax rate structure and broadening the tax base.
Strengthen local governments power and capacity to play a strong developmental and governance role.
Also, women’s empowerment remains a priority of our partnership, building on the well-known achievements so far. Raise the degree of women empowerment, by making it easier to have access to finance and mobile phones, and providing the necessary skills to girls, especially in science and technology fields.
As a long-standing partner, we will support Bangladesh as it navigates a challenging global environment on its way to reaching upper-middle-income status by 2031. I am confident that with the right set of policies and timely action, Bangladesh can achieve its growth aspirations.
Honorable Prime Minister, ladies and gentlemen, Bangladesh’s remarkable journey was made possible by the indomitable energy and resilience of its people and a national will to build a prosperous nation. We are proud of our partnership and look forward to opening the next chapter together with you.