[🇧🇩] Monitoring Bangladesh's Economy

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Global trade moderation and Bangladesh

The calendar year 2025 is now set to enter its final month tomorrow. In other words, just a month from now, the world will see the start of another year. The annual stock-taking of global economic performance is already underway, although only relevant data for the first three quarters (January-Sep

thefinancialexpress.com.bd

Global trade moderation and Bangladesh

Asjadul Kibria
Published :
Nov 29, 2025 23:12
Updated :
Nov 29, 2025 23:49

The calendar year 2025 is now set to enter its final month tomorrow. In other words, just a month from now, the world will see the start of another year. The annual stock-taking of global economic performance is already underway, although only relevant data for the first three quarters (January-September) is available. In this connection, the World Trade Organization (WTO) released the latest Goods Trade Barometer on Friday last. The barometer is a composite leading indicator for global trade that provides real-time information on the course of trade in goods relative to recent trends. Usually, the barometer predicts trade developments two to three months ahead. The latest barometer indicates a possible development of global trade in the last quarter of the current year.

The key message of the latest WTO Goods Trade Barometer is that global goods trade growth is set to moderate in the last quarter, leading to slower growth in the last half of the year. The surge in global trade in the first half was mainly driven by frontloading of imports ahead of expected tariff hikes and by rising demand for AI-related products, according to the barometer index analysis. The overall barometer index fell to 101.8 in September, down from 102.2 in June and below the quarterly trade volume index, which reflects actual merchandise trade developments.

There are six component indices of the barometer, and all are above their standard baseline value of 100 except for the agricultural raw materials index (98.0), which has been in contraction since the start of the year.

The indices for air freight (102.7) and container shipping (101.7) remain above trend. Nevertheless, these two indices have declined over the last three months, indicating a slowdown in global goods transportation. In other words, trade volume is likely to go through a downtrend in the coming days. The WTO last month predicted that merchandise trade, in terms of volume, may register 2.4 per cent growth in 2025 and 0.5 per cent in 2026. The slower growth projection is driven by higher tariffs and trade policy uncertainty in the second half of 2025 and in 2026.

The indices for automotive products (103.0) and electronic components (102.0) remained constant over the same period. It also indicates moderate growth prospects. Finally, the new export orders index (102.3) surpassed the baseline value of 100 in the second quarter, after some volatility at the end of 2024 and the start of 2025.

So, the overall reading of the indices suggests a moderation in global merchandise trade growth this year.

Earlier last month, the UN Trade and Development (UNCTAD) in its global trade update showed that the world trade expanded by about $500 billion in the first half of 2025, despite volatility, policy shifts and persistent geopolitical tensions. "Momentum remained strong into the third quarter, even as growth patterns varied across regions and sectors," it added.

UNCTAD also said that the trade growth continued in the third quarter, with goods expected to expand by about 2.5 per cent quarter over quarter and services accelerating sharply to around 4 per cent. As full data for the third quarter trade were not available at the time of releasing the UNCTAD update, the UN organisation issued a nowcast, a forecast of what is immediately expected, for the third quarter. It also said that barring major adverse shocks in the final months of 2025, global trade is projected to surpass its 2024 record levels. Last year, the value of global merchandise trade stood at US$24.5 trillion, posting modest growth of 2 per cent over 2023.

UNCTAD was of the view that despite turbulence from shifting US trade policy, global trade dynamics have so far shown limited disruption. However, uncertainty over future policy remains a key risk. "Geopolitical instability also continues to weigh on trade, with persistent conflicts that could further disrupt regional dynamics and heighten concerns over energy and food security," it added in its October update report.

The moderation of the global trade in goods will also impact countries like Bangladesh as their exports are dependent on the movement of the global market. Already, the country's trade in goods registered a modest 2 per cent growth in the first nine months of the current year over the previous year. Statistics available with Bangladesh Bank showed that total trade in the January-September period of 2025 stood at $82.79 billion, which was $81.14 billion in the same period of 2024.

The official statistics also showed that merchandise exports of the country increased by 4.74 per cent in the first nine months of the current year, whereas the imports remained almost the same, reflecting weak domestic demand.

As the country enters the election-centric political business cycle, weak domestic demand will persist for a couple of months before and after the election in February of the next year. While the import is correlated with domestic demand, the export is linked to the international market, which has already become somewhat volatile due to Trump's tariff policy.

The US President initially imposed a 35 per cent reciprocal tariff on Bangladesh, which later fell to 20 per cent after hectic negotiations with several commercial offers to the US. The new tariff rate comes into effect in August, and the primary impact will be visible by the end of the year.

As China is the leading trade partner, mainly because it is the largest source of imports in Bangladesh, despite a decline in domestic demand, total imports from China will post moderate growth by the end of the year.

Overall, Bangladesh is going to witness a year of sluggish trade in goods which will have some negative impact on the growth of country's gross domestic product (GDP).​

 

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Beyond apparel: How Bangladesh can develop new exports

Bangladesh's economic diversification has remained a goal rather than an outcome for decades.

www.thedailystar.net

Beyond apparel: How Bangladesh can develop new exports

A key to diversifying Bangladesh's export basket lies in replicating the success of the apparel industry. FILE VISUAL: SHAIKH SULTANA JAHAN BADHON

Bangladesh urgently needs to diversify its economy. The country has a limited ability to produce and export sophisticated goods. It ranks low (128th out of 145 countries) on the Economic Complexity Index, which measures the diversity of a country's exports. Except for some petroleum-based economies, the country is one of the most narrowly concentrated economies in Asia. Exports remain largely focused on the apparel sector, which constitutes over 80 percent of exports. The apparel industry earns $40 billion in exports, while no other sector brings in more than $1 billion in an economy worth nearly half a trillion dollars.

Historically, Bangladesh has shown its ability to diversify its export base. In the late 1970s, goods made from jute fibre accounted for around 70 percent of total merchandise exports when the apparel industry's share was less than four percent. The share of the apparel industry increased to 75 percent in the early 2000s, a remarkable feat in transforming an agrarian economy towards a labour-intensive, export-oriented manufacturing country. This success led to export concentration in the apparel sector.

The rise of the apparel industry reduced the share of traditional exports like jute and leather, which have stagnated at around one billion dollars for decades. With over 85 percent of the labour force in informal jobs, Bangladesh needs job-centric and export-driven manufacturing growth to diversify its economy and create more formal employment.

A key to diversifying Bangladesh's export basket lies in replicating the success of the apparel industry. Partnerships were crucial to the apparel sector's stellar success. In the late 1970s, a Bangladeshi apparel manufacturing company, Desh Garments, created a joint venture with the Republic of Korea's Daewoo Corporation, combining local cheap and trainable labour with its foreign counterpart's technological expertise and market access. More than one hundred Bangladeshi technical staff were trained at Daewoo's factory for six months, enabling the transfer of essential technical expertise and contributing to the development of the apparel sector. Some of these workers later became entrepreneurs.

To be a major player in chip manufacturing, the Indian conglomerate Tata is sending hundreds of staff overseas to its technical partner for training in semiconductor fabrication. Training and technology transfer occur most efficiently and effectively when both parties in a partnership have a shared business interest. Partnerships—government-government, private-private, or public-private—are vital for sector development in developing economies.

For instance, Chile was historically known as a copper exporter. Its transformation into a global seafood exporter, thanks to the Japan-Chile Salmon Project, is an example of a successful partnership. This project transferred advanced aquaculture technologies and provided crucial market access, with public-private partnerships making the knowledge widely available.

To bring economic diversification to fruition, Bangladesh's government and development partners can focus on developing partnerships based on sound economics and honest intentions. This is a crucial element in the country's diversification efforts. Bangladesh's world-class non-governmental organisations can unite communities, disseminate technologies, and train the workforce. This is a unique advantage for Bangladesh which is not currently used in the economic diversification initiatives.

Governments and their development partners often work with many industries at once to address shared policy or regulatory challenges. While this broad approach has benefits, it can make it harder to scale up emerging industries. Focusing resources on a few key sectors, backed by a long-term plan with clear goals, is usually more effective.

Development finance institutions can assist. They have experience in developing partnerships by managing geopolitical challenges, ensuring equitable returns, supporting public-private cooperation, and above all, supporting economic benefits. They should focus on one sector at a time, providing comprehensive support across the value chain to mobilise investments and achieve measurable export goals.

The country needs to diversify into new sectors and simultaneously strengthen the apparel industry through innovative products and access to new markets. With approximately five percent of global export share, Bangladesh's apparel industry continues to present growth opportunities. The country can diversify its economy by replicating the apparel industry's successful model of international partnerships, technical training, and targeted long-term planning.

Bangladesh's economic diversification has remained a goal rather than an outcome for decades. A focused approach built on transparent partnerships and targeted industrial development can convert these long-discussed possibilities into real progress. International partnerships, targeted training, and long-term planning offer a practical path to developing new industries and expanding the country's economic base.

Bidyut Kumar Saha is lead investment officer at ADB Bangladesh Resident Mission.

Chandan Sapkota is public management economist at ADB Sectors Department.​

 

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https://thefinancialexpress.com.bd/economy/bangladesh/remittances-cross-13-billion-in-first-5-months-of-fiscal

Remittances cross $13 billion in first 5 months of fiscal

Published :
Dec 01, 2025 21:00
Updated :
Dec 01, 2025 21:00

Bangladesh received its highest monthly remittance inflow of the current fiscal year FY 2025-26, crossing US $2.88 billion November.

This substantial inflow translates to an average daily remittance of approximately $96.3 million. In the five month of the current fiscal year Bangladeshi expatriates sent $13.03 billion remittance while it was $11.7 billion in the previous fiscal year, UNB reports.

According to updated data released by the Bangladesh Bank on Monday, the remittance flow in November saw a significant increase of 31.37 percent compared to the previous month of October.

The total remittance figure for November stands at $2.88. Of this amount, state-owned banks received $587.76 million as remittance, specialized banks handled $298.95 million, and the largest share, around $2.0 billion, came through private banks. Foreign banks accounted for the remaining $5.94 million.

The central bank also provided a weekly breakdown, showing consistent high flow throughout the month, with the largest weekly amount of $768.48 million arriving between November 9 and 15, and the smallest being $43.18 million on November 1st.

The November figure significantly surpasses the inflows of the preceding months of the current fiscal year: October saw $2.56 billion, September recorded $2.68 billion, while August and July inflows were $2.42 billion and $2.47 billion, respectively.

This robust performance follows the record-breaking remittance year of FY2024-25, where expatriates sent $30.32 billion, marking the highest annual inflow in the country's history so far.​

 

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Striking a balance between growth and job creation

Over the past one and a half decades, the term Gross Domestic Product or GDP became synonymous with development and the state-owned statistical agency and other official documents would occasionally come up with various data showing how the economy was on an ever-rising growth trajectory. Obviously

thefinancialexpress.com.bd

Striking a balance between growth and job creation

Published :
Dec 02, 2025 22:19
Updated :
Dec 02, 2025 22:19

Over the past one and a half decades, the term Gross Domestic Product or GDP became synonymous with development and the state-owned statistical agency and other official documents would occasionally come up with various data showing how the economy was on an ever-rising growth trajectory. Obviously, those were projected as the measure of the nation's development. Even the international development partners were convinced of those growth narratives and would praise the then-government for its success story of economic growth. Against this backdrop, economists have of late been coming up with research data that are unravelling the mismatch between growth, for instance, in the manufacturing sector and the rising rate of unemployment. Presented at a recently held discussion event styled "Beyond Jobless Growth: Towards an Employment-Centred Policy Framework for Bangladesh Through a Post-Neoliberal Lens", some study findings showed that the manufacturing sector despite recording an impressive annual rate of growth at around 10 per cent between 2013 and 2023, had shed 1.4 million jobs during that period. How can one explain this glaring mismatch between growth and unemployment at the same time?

It was found that in the export-oriented garment industry, fewer workers produced more value in terms of export earnings than before. In 2013, for instance, the industry required 220 workers to produce goods worth US$1.0 million in terms of export earnings. However, a decade later in 2024, the same amount of goods and matching export earnings could be generated by 94 workers. That was definitely good news for the investors who achieved such success through adoption of modern technology that increased productivity of the industry manifold, but at a cost. While one cannot deny the industry's higher level of productivity and earnings that go with it, but at the same time it creates a fresh crisis for the policymakers resulting from the massive job cuts. How can these dichotomous developments in the macro-economy be reconciled? Growth is no doubt a priority before the investors in the manufacturing industries such as the export-driven ones, but the question that would also arise at the same time is, growth for whom? And this issue is especially problematic for a country where about 3.0 million people are entering the job market annually. So, creating jobs for the fresh millions joining the workforce every year should be the topmost priority before the government as well as the development thinkers.

Unsurprisingly, some experts at the said discussion event blamed the deepening employment crisis on what they termed disproportionate focus on a single industrial sector, namely, the Readymade Garment (RMG). This, no doubt, created an imbalance affecting the rest of the economy. For when the RMG-led manufacturing has been experiencing significant rise in terms of growth, the agriculture that absorbs the overwhelming proportion of the growing workforce went through a decline as its contribution to the GDP fell markedly from its previous level. This calls for incentivising more agro-based industries including the start-ups in the sector. That may help reduce the job loss on a massive scale like the manufacturing sector suffered over the last one decade.

Overall, it is time for a rethink on the part of both the government and the economic expert about getting the priorities for growth and employment right. While the economists are rightly blaming government policies and explaining the existing economic realities through different terminologies such as 'triangle of vicious cycles' and so on, the real challenge would be to come up with the correct guidelines for the policymakers and the businesses to follow. It goes without saying that the right model for the economic growth should be the one that creates more jobs and ensures growth at the same time.​