Country Report Bangladesh September 2009

Outlook for 2009-10

• The ruling Awami League (AL) is expected to serve a full term after securing a big majority at the general election in December 2008. The main opposition Bangladesh Nationalist Party (BNP) won just 29 of 300 seats in parliament.
• The likely monopolisation of parliament by the AL for the next few years raises the risk of large street protests, a tactic that has been used in the past to express opposition to the government.
• The government will post wide budget deficits in the forecast period as revenue expansion fails to keep pace with growth in spending.
• The latest economic data point to strong inflows of workers' remittances. This has led the Economist Intelligence Unit to revise its real GDP growth forecast to 5.6% in fiscal year 2009/10 (July-June), from 5.2% previously.
• We have revised our forecast for consumer price inflation and now expect this measure to average 4.5% in 2009, from 5.1% previously. However, we expect prices to resume an upward trend from 2010.
• The merchandise trade deficit will narrow in 2009, as lower global commodity prices (relative to those of 2008) significantly reduce the country's import bill.

Monthly review

• Parliament reconvened after its summer break on September 7th, but the BNP continued its boycott.
• Although the government is pushing ahead with plans to create a war crimes tribunal to prosecute those alleged to have committed atrocities during the 1971 war of independence, it has ignored calls to draft a timetable.
• The government has awarded two energy firms, ConocoPhillips of the US and Tullow Oil of Ireland, rights to explore for gas in the Bay of Bengal.
• In recent weeks the IMF has allocated special drawing rights worth US$735m to Bangladesh. The allocation is part of a wider programme to improve global liquidity conditions amid the global financial crisis.
• The annual rate of consumer price inflation stood at 2.3% in June, the lowest rate recorded since December 2001. The low rate reflects a sharp drop in the price of rice, the main food staple in Bangladesh.
• According to data published by Bangladesh Bank (the central bank), the surplus on the current account surged to US$2.5bn in 2008/09, from US$680m in 2007/08.

Source: Country Report

This report covers the following industry codes:
SIC Code: 70;60;37;48;80;22
NAICS Code: 72;52;336;517;62;313