The London-based reputed Financial Times newspaper has highlighted Bangladesh’s development stories in an article to show the world what the country can offer to others.
David Pilling, a former Asia editor of the Financial Times, wrote the article titled ‘What Bangladesh can teach others about development’.
“Name a country with a per capita income of less than $500, where women have an average of 4.5 children and where 44 percent of people live in extreme poverty? The answer is Bangladesh - – circa 1990.
“Today, despite all its problems, the country has been transformed. GDP per capita has increased eightfold. Women have an average of two children, meaning parents have more money to spend on each child’s education, health and wellbeing — and banks have more savings to recycle to industry. The proportion of people living in absolute poverty has more than halved.
“The position of women has greatly improved. There are more girls in high school than boys. In 1971, when the country became independent, one in five children died before the age of five. Today that figure is one in 30.
“One should not exaggerate. Bangladesh remains poor. It struggles with political unrest, environmental risks and high levels of corruption. It was only this week that it approached the IMF for a multi-billion dollar loan. But if you look at it in the long term, Bangladesh – once dismissed as a ‘bottomless basket’ by Henry Kissinger – is a development success.
“In this it contains lessons for many parts of Africa, although it is rarely mentioned as a template for development. South Korea and Singapore are often mentioned, but no African country can match their success.
“Bangladesh offers a glimpse of what is truly possible and a rebuke to those who see past national achievements as a guide to future prospects, as well as those who write off an entire continent. Independent Bangladesh emerged from the civil war and soon saw famine and political assassinations. Out of this unpromising start came a version of success.
“Stefan Dercon, a development economist at Oxford University, attributes this to three main factors. First, there is the textile industry, whose exports grew from $32 million in 1984 to $34 billion today. In 2020 Bangladesh earned twice as much of clothing exports like all 54 African countries combined.
“Second, there are the remittances. Bangladeshis working abroad sent home $22 billion last year. Third, according to Dercon, is the role of non-governmental organizations such as BRAC and the Grameen Bank, who provide a safety net and give some poor people a lift.
“In none of this, Dercon argues in his book Gambling on development, the government had a “grand design”. Rather, it stayed out of the way.
“For example, it refrained from killing the burgeoning textile industry and allowed NGOs to operate unimpeded. It is true that Bangladesh has grown by exploiting its own cheap labour, sometimes at a horrific cost.
“More than 1,000 garment workers were crushed in the 2013 Rana Plaza tragedy. Yet every industrializing country, from Britain with its vile Victorian slums to Japan with its Minamata mercury poisoning scandal, has experienced similar horrors.
“Charlie Robertson, chief economist at Renaissance Capital, also attributes Bangladesh’s development success to three factors. (Economists like threes.) His are literacy, electricity, and fertility.
“In his book, The time-traveling economist, he argues that the prerequisites for industrial start are an adult literacy rate of more than 70 percent, an electricity supply of more than 300 kWh per person and a fertility rate of less than 3 children – all tests that Bangladesh passes.
“Many African countries have literacy rates above 70 percent, meaning they have ready-made factory workers. Few countries can provide reliable electricity at competitive rates. Most, from Guinea-Bissau (21 kWh per capita) to Ethiopia (82 kWh) and Nigeria (150 kWh), fail to overcome Robertson’s 300 kWh hurdle.
“Robertson’s claim that countries cannot prosper unless the fertility rate falls below 3 is controversial. But there is a direct correlation, he says, between family size, family savings, and the availability and affordability of industry bank loans. Bangladesh has a loan rate of 39 percent to GDP, compared to 12 percent in Nigeria. The fertility rate is 2 to 5.2 in Nigeria.
“African countries with fertility rates below 3 include Botswana, Mauritius, Morocco, and South Africa. They are among the richest on the continent. There is room to debate why, but the correlation is strong. The rest of Africa ranges from middle-income Kenya, with a fertility rate of 3.4, to Niger, one of the poorest countries in the world, with a fertility rate of 6.7.
“Today’s Bangladesh is where South Korea was in 1975, when it was on the brink of a miracle. Several African countries meet or nearly meet Robertson’s criteria for launch. Honest and progressive governments undoubtedly help. But Bangladesh shows that there is also a muddy path to prosperity,” read the article.