Bangladesh economic growth will be highest in Asia this year: IMF

Although Bangladesh economy is going through a tough time, the country will see the highest growth among all countries in Asia this year, according to an International Monetary Fund (IMF) forecast.

In the index of 189 countries, only two countries--Caribbean country Dominica and African South Sudan—may see higher growth than Bangladesh, posting 9.4 percent and 7.9 percent respectively.

The economic growth will be 7.8 percent by the end of this year, but growth will drop to 7.4 percent next year, according to the World Economic Outlook titled "Global Manufacturing Downturn, Rising Trade Barriers" released by the IMF on Tuesday.

The global economy is in a "synchronised slowdown" while growth in the world output will reduce to 3 percent from 3.6 percent of the previous year.

Growth of developed economies like the United states, Germany, France, Italy, Spain, Japan, the United Kingdom and Canada will face a significant fall to 1.7 percent from 2.3 percent.

The IMF predicted that growth this year will be the weakest since the 2008 financial crisis primarily because of widening global conflicts.

Gita Gopinath, economic counsellor of the IMF, in the report said, "Global economy is facing an unresponsive growth, a consequence of rising trade barriers; elevated uncertainty surrounding trade and geopolitics; idiosyncratic factors causing macroeconomic strain in several emerging market economies."

She recommends government of member countries to take proper action plan which will significantly boost confidence, rejuvenate investment, halt the slide in trade and manufacturing, and raise world growth.

The average growth of low-income developing countries will remain robust, according to the report, but some countries of this group may face recession.

The robust growth is expected for non-commodity exporters such as Vietnam and Bangladesh while the performance of commodity exporters like Nigeria is projected to remain lacklustre.

The updated forecast was prepared for this week's half-yearly meetings of the 189-nation IMF and its sister lending organisation World Bank.

The IMF estimates that the US-China trade tensions will cumulatively reduce the level of global GDP by 0.8 percent by 2020.

Among the South Asian countries, Nepal will reach the second highest growth of 7.1 percent this year after Bangladesh, but the country's growth will fall to 6.3 percent next year.

The IMF predicted India's growth to be 6.1 percent this year which will be the third highest in this region, and growth will rise to 7 percent next year.

Sri Lanka's growth will fall to 3.2 percent as its economic downward trend continues for the fifth consecutive year.

Inflation in Bangladesh has been in a falling trend since 2011 while it will decrease to 5.5 percent this year and remain at the same point next year.

The report has no positive indication for Bangladesh in the current account balance as there will be a two-percent deficit to GDP this year. The deficit will increase to 2.1 percent next year.

The IMF said Bangladesh witnessed the positive value in the current account balance from 2012 to 2016 and the highest value was 1.9 percent of GDP in 2016.

The balance will remain negative till 2024, said the long-term forecast of the IMF.