Bangladesh's GDP growth to be less than 4%: EIU

Bangladesh's economic growth will be less than 4 percent this year due to the impact of the coronavirus, according to a forecast of the Economist Intelligence Unit. 

"We expect the coronavirus pandemic to dampen economic growth substantially," said the EIU in its report released on March 27. 

It says preventive measures taken by governments to curtail the movement of people will lead to a demand-side shock to private consumption, the primary driver of economic growth in many South Asian economies. 

The closure of factories and businesses will result in a supply-side shock, and the subsequent lay‑offs will exacerbate the demand shock.

The Economist Intelligence Unit expects countries to provide fiscal and monetary stimulus, although the scope of such measures will vary.

On Wednesday, the Ministry of Finance revealed the guideline for disbursement of the Taka 5,000 crore stimulus package for the export-oriented industries announced earlier by Prime Minister Sheikh Hasina to help those overcoming the impact of the global coronavirus pandemic. 

The Bangladesh Bank has already been asked to frame a detailed policy in this regard. The Ministry of Finance will form a Taka 5,000 crore bond against the central bank while the central bank will then form a Taka 5,000 crore refinancing fund from which the affected exporters would be able to take loans through the banks.