With a 7.7 per cent growth-rate, as predicted in the Economist, Bangladesh has only one country ahead of it: no, it is not China (6.1 per cent), nor India (6.7 per cent), but a surprising war-ravaged Syria (with 8.9 per cent). More in the business community may prefer investing in and trading with Bangladesh than Syria, a ground-level consideration we must never lose sight of during 2020 to make it reality in 2021. For a country wanting to join the 'developed' club in the 2040s, Bangladesh is already falling behind the growth-rate clock. Nevertheless, since it has been galloping behind league-leaders China and India for half a generation, now comfortably ahead of both, it will only have itself to blame if it does not stand as a 'developed country' leader when that time arrives: not only will that make the 'developed country' transformation complete before the very eyes of the diminishing few who saw the country in the pits during the 1970s, but it would also signal the country has purged its deep underlying malaise.
Before getting to those constraints, it is useful to picture how the entire world stands at this moment, since only then would that transformation and those underlying constraints make any sense. Bangladesh belongs to a continent whose growth is likely to be at least twice as big as anywhere else on this planet: 5.2 per cent as against 2.5 per cent in Sub-Sahara Africa, 2.4 per cent in Eastern Europe, 2.3 per cent in the Middle-east and North Africa, as well as Australasia, 1.6 per cent in North America, 1.4 per cent in West Europe, and 1.2 per cent across Latin America. That said, over the past 10 years, Bangladesh's average growth-rate, of just under 6.0 per cent, falls behind only China (just under 7.0 per cent), stays a step or two ahead of India, and displays a growth-rate almost four times better than the rich-country club, the Organisation for Economic Cooperation and Development (OECD), whose average was just over 1.0 per cent. Where East Europeans far outperform their West European counterparts, all other heavyweights seem so constrained that market expansion would have to be sought elsewhere by Bangladesh to register the necessary export growth for that 'developed country' passage: Australia musters 2.3 per cent, Canada 1.7 per cent, France 1.3 per cent, Germany 0.9 per cent, Japan 0.4 per cent, New Zealand 2.2 per cent, Russia 1.5 per cent, Turkey 4.0 per cent, the United Kingdom 1.1 per cent, and the United States 1.6 per cent. Its key export competitors also show clipped growth: the Philippines with 5.2 per cent, Sri Lanka with 3.4 per cent, Thailand 2.1 per cent, and Vietnam 6.5 per cent, among others.
Those figures from The World in 2020 depict a gloomy picture that must be enlivened. One small step in that direction by Bangladesh would be to further open foreign investment, diversify foreign investors, liberalise its economy further, promote alternate export items, and climb the product value chain. All of these typify an ascendant developed country, not a declining developed country, as we see scattered most vividly across West Europe, perhaps less so but still evident across North America. Together, it would represent a revolutionary climb out of the little league since the chains necessary then to protect labour and the economy stand incompatible with the sinews of growth and development. If we heed the claim of Germany's first Chancellor and Founder, Otto von Bismarck, that a free-trade policy-approach reflects a 'strong' country, we will be taking the first step in the right direction: many low-wage workers will be hit hard immediately, but the much-needed industrial diversification could transform the landscape beyond recognition over the long haul, exposing other export-boosting sectors.
To be sure, our average tariffs remain in the teens, lowering glacially more than growing. Opening our markets would help breathe life in the global economy at low Bangladeshi costs: since we are splurging with high-end imports, mostly of consumer final-use commodities, standard imports would at least stimulate the larger economy, a factor of enormous importance as all countries slowly adjust to the dynamics unleashed by the Fourth Industrial Revolution and artificial knowledge.
More painful for Bangladesh would be eliminating low-wage workers. They do not belong in a developed country, and besides, they need to cultivate their own personal and family lives to fit into a developed country, beginning with education. If this jolts our ready-made garments (RMGs) industry, the losses cannot be heavy: automation carries multiple advantages, the key one being the capacity to keep the exported product-value competitive enough. The greatest benefits would be in launching or expanding industries commensurate with a developed country. This diversification is where the meat lies.
We have already entered ICT (information and communications technologies) exports, fetching up to 1.0 billion USD annually, exposing one area of significant diversification, but needing a more educated workforce than we can presently offer. Leather products, motor vehicles, pharmaceuticals, ship-building-and-breaking have all been tapped for exports with promising results, which must now be put into fourth-gear. Note how almost all need some degree of education. Chemicals, high-end clothing, food and beverages, furniture, and the like will be in increasing demand, but depicting other areas of both investment and imports, many at lower educational thresholds: from the investments we hope to absorb more of the higher-skilled employees, and with the imports we create the flavour conducive to tourists, one sector in need of greater cultivation.
Among the spillover effects of a more vibrant and open economy is a flourishing hotel/restaurant sector, replete with travelling and tourism. We have put a lot of eggs into the infrastructure basket, and with the expected opening of the Padma Bridge in 2021, more regions of Bangladesh would find inter-connections, not to mention the growth of a viable second port in Payra to absorb the massive production along Dhaka's periphery. Just keeping the Padma Bridge viable requires the greater flows of travels and merchandise. Similarly, just to absorb the enormous expected flows from India's heartland to its Northeast provinces necessitates a freer and unhindered border-policy approach. Denying these accesses undercuts development in both India and Bangladesh, exacerbating mutual relations.
Though freer trade and investment remain the clarion calls of this piece, doing so within environmentally safe and sound parameters must show its face in 2020. Aside from the SDG (Sustainable Development Goals) requirements and climate-change imperatives, the country has to step up and take bold initiatives against carbon emission, be this from coal-powered plants or automobile emissions: encouraging private enterprises helps alternative options, those more renewable (like solar energy) and sustainable being more compatible with a developed country's profile. With environmental and human rights safeguards, particularly for children and women, Bangladesh can legitimately enter a developed-country club. Until then, the 'giant leap forward' mindset may actually miss a critical beat or two.
What Bangladesh does in 2020, then, will be pivotal. Suggested changes could lubricate that long-term transformation into a developed country; half-hearted efforts would leave us looking like an emperor with no clothes; while no effort would confirm the 'bottomless pit' tag as an irreplaceable trait. With the 50th birth anniversary knocking on the door, do we really have a choice?
Dr. Imtiaz A. Hussain is Dean (Acting), School of Liberal Arts and Social Sciences (SLASS) and Head, Global Studies & Governance Program. Independent University, Bangladesh