Bangladesh becomes emerging economy from bottomless basket

Nizam Ahmed

Nizam Ahmed

Bangladesh, once known as the bottomless basket in 1970s, is now an emerging economy of the South Asia, with annual exports of some $23 billion mainly from garment products, remittances of some $18 billion and GDP growth of over 6.0 percent despite of its confrontational politics over the past decades, analysts said on Friday.

Its annual food production is now stands at more than 35 million tonnes, mostly staple rice, sufficient to feed its some 156 million people over an area of 147, 570 sq. km. (55,813 sq. mi.), mainly flat alluvial plain, with hills in the northeast and southeast, officials of the ministry of food and disaster management said.

Standard & Poor’s Ratings Services on May 31 affirmed its ‘BB-‘long-term and ‘B’ short-term foreign and local currency sovereign credit ratings on Bangladesh with stable outlook. The transfer and convertibility (T&C) assessment remains ‘BB-‘.

Bangladesh (People’s Republic of)-

Regulatory Disclosures
Issuer Credit Rating
Ratings Rating Date Regulatory Identifiers Last Credit Rating Action
Foreign Long Term BB- 05-Apr-2010 EE 05-Apr-2010
Outlook STABLE
Foreign Short Term B 05-Apr-2010 EE
Local Long Term BB- 05-Apr-2010 EE 05-Apr-2010
Outlook STABLE
Local Short Term B 05-Apr-2010 EE
Transfer & Convertibility Assessment
Ratings Rating Date Regulatory Identifiers Last Credit Rating Action
Local Long Term BB- 07-Apr-2010
RATINGS DEFINITIONS
The general meaning of our credit rating opinions is summarized below.
Investment Grade ‘AAA’ Extremely strong capacity to meet financial commitments.
Highest Rating.
‘AA’ Very strong capacity to meet financial commitments.
‘A’ Strong capacity to meet financial commitments but somewhat
susceptible to adverse economic conditions and changes in
circumstances.
‘BBB’ Adequate capacity to meet financial commitments, but more
subject to adverse economic conditions.
‘BBB-‘ Considered lowest investment grade by market participants.
Speculative Grade ‘BB+’ Considered highest speculative grade by market participants.
‘BB’ Less vulnerable in the near-term but faces major ongoing
uncertainties to adverse business, financial and economic conditions.
‘B’ More vulnerable to adverse business, financial and economic conditions but currently has the capacity to meet financial commitments.
‘CCC’ Currently vulnerable and dependent on favorable business,
financial and economic conditions to meet financial commitments.
‘CC’ Currently highly vulnerable.
‘C’ A bankruptcy petition has been filed or similar action taken, but payments of financial commitments are continued.
‘D’ Payment default on financial commitments.
Note: Ratings from ‘AA’ to ‘CCC’ may be modified by the addition of a plus (+) or
minus (-) sign to show relative standing within the major rating categories.
Ratings Outlook
A Standard & Poor’s rating outlook assesses the potential direction of a long-term credit
rating over the intermediate term (typically six months to two years). In determining
a rating outlook, consideration is given to any changes in the economic and/or
fundamental business conditions. An outlook is not necessarily a precursor of a rating
change or future CreditWatch action.

  • Positive means that a rating may be raised.
  • Negative means that a rating may be lowered.
  • Stable means that a rating is not likely to change.
  • Developing means a rating may be raised or lowered.
  • N.M. means not meaningful.
CreditWatch
CreditWatch highlights our opinion regarding the potential direction of a rating.

  • Positive means that a rating may be raised.
  • Negative means that a rating may be lowered.
  • Developing means that a rating may be raised, lowered or affirmed.

CreditWatch is not intended to include all ratings under review, and rating changes may
occur without the ratings having first appeared on CreditWatch.

A rating can be on either CreditWatch or have an Outlook, but not both at the same time.
View more detailed ratings definitions.

The country with GDP worth $96 billion, got the same rating and outlook from this US-based rating agency for the third consecutive year. The first yearly rating was done in 2010, officials of the central Bangladesh Bank said.

With the latest one, Bangladesh is rated the second highest in South Asia behind India (BBB) and ahead of Sri Lanka (B+) and Pakistan (B-). Other countries in the BB category include Turkey, Philippines, Indonesia and Vietnam. The government has recently finalised the long-term perspective plan, with a target to make Bangladesh a middle-income country by 2021, by raising per capita income to $2,000, officials of the ministry of finance said. According to the plan, the government eyes to bring the annual rate of inflation down to 5.2 percent from the existing average inflation of 9.93 per cent by 2021 through proper management of monetary and revenue policies. The budget of the current fiscal 2012 to June had set a target to keep annual inflation rate at 7.5 percent.


Image: Screen of Bangladesg Credit Report from www.standardandpoors.com.According to Bangladesh Economic Review 2011, per capita income was $818 in 2010-11 fiscal and $751 in 2009-10.

The United States and the western world rate the Bangladesh as a moderate Muslim democracy and the country successfully crushed a rising terror group which wanted to establish Islamic sharia law in the beginning of the new millennium.

The militants were subdued after their six top leaders were executed in 2007 and 200 others sentenced long terms in jails.

The administration successfully tackled a mutiny in a paramilitary unit in early 2009, in which 54 army officials were killed. More than 3,500 troopers are being tried for the mutiny and more 2,500 have been sentenced to different terms and the rest are being tried.

The exports and inflow of remittances to the country have been increasing despite an ongoing global slowdown, traders said.


193 Responses to “Bangladesh becomes emerging economy from bottomless basket”

  1. Khondkar Abdus Saleque

    Many may not see the slow but steady growth of economy . Bangladesh economy is urviving despite of global recession , EU economic crunch for wonderful performance of agriculture. Bangladesh could successfully crush the ugly teeth of organised terrorism.There are several issues and challenges . Conspirators and polottters are doing their bit.Ill gotten money is talking in ” The Economist” ,” Sri Lanka Guardians ” and some other foreign media. Some intellectual prosptitutes of Bangladesh continues to spread venom. But overall situation , economic indices have nothing to worry about. Poor people in villages are sleeping well. Major city dwellers are suffering . But that is not different from any major cities of the sub continent.
    Police and some agencies are carrying out internecine activities.
    If government can control police and improve power , Gas and Water supply situation it can steady the rocking boat.
    The street agitation is definitely aimed to frustrate government actions against war criminals and corrupt syndicate . People should talk about their own issues and not dance to the ” Putul Naacher ashor ” .

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