The World Bank has warned that Bangladesh may see an additional three million people fall into extreme poverty by the end of 2024, amid a continued slowdown in economic activity linked to political uncertainty.
The global lender’s latest Bangladesh Development Update, released on Wednesday, forecasts a rise in the country’s extreme poverty rate from 7.7 percent in 2023 to 9.3 percent this year. The projection is based on the international poverty line, which defines extreme poverty as living on less than $2.15 a day.
The report anticipates some recovery in the coming fiscal year, projecting the extreme poverty rate to decline to 6.1 percent in FY2025. However, it warns that the impact of the current slowdown will be uneven, affecting vulnerable populations more severely and widening social and economic inequality.
“Vulnerable populations are likely to be disproportionately affected, widening social and economic disparities,” the report noted, pointing to a weak labour market and declining real wages across all sectors.
The World Bank also revised its GDP growth forecast for Bangladesh, predicting the economy will expand by just 3.3 percent in the ongoing financial year, down from its earlier projection of 4 percent in October. The forecast was included in a separate report, South Asia Development Update: Taxing Times, released on Tuesday.
Bangladesh, which saw over 6 percent growth annually from 2010 until the COVID-19 pandemic, has not experienced such a low growth rate since 2020.
