Bangladesh has made remarkable progress in reducing poverty and improving living conditions, mostly driven by labor income, World Bank (WB) says. It said, almost 8 million Bangladeshi came out of poverty between 2010 and 2016. The WB Country Director for Bangladesh and Bhutan, Mercy Tembon said, “Bangladesh has made remarkable progress in reducing poverty in the last decade.”
“But, with one out of four people still living in poverty, the country needs to do more, especially in addressing the new frontiers of poverty, she said giving example that, “Tackling urban poverty is critical since at current trends more than half of the poor in Bangladesh is projected to live in the urban areas by 2030.”
Speaking at the event, Finance Minister AHM Mustafa Kamal hoped that there would be significant improvement in reducing poverty rate in Bangladesh in the next 2 to 3 years. “Our extreme poverty rate is less than 10%. But, the rate in upper poverty line is hovering around 19-20%. It has to be taken care of,” he said.
The WB chief made the observations while speaking the launching a study report prepared by World Bank titled, “Bangladesh Poverty Assessment: Facing Old and New Frontiers in Poverty Reduction,” on Monday at Hotel Amari in the city. The WB report said that robust economic growth continued driving poverty reduction, but at a slower rate. Since 2010, while the pace of economic growth increased, the rate of poverty reduction declined.
WB Senior Economist and report co-author Maria Eugenia Genoni said, “The report highlights that traditional drivers of poverty played a role, but also notes the limits of some of these drivers in bringing about progress. Genoni said, “Further, to achieve its vision of upper middle-income country by next decade, Bangladesh can build on its own experience of innovative policy experimentation to tackle poverty in a more sophisticated and urbanized economy.”
During 2010-2016, rural areas accounted for about 90 percent of the poverty reduction in the country. There was little poverty reduction in urban areas and the share of urban people living in extreme poverty remained the same, the report said. Industry and services, not agriculture, mostly led poverty reduction in rural areas. Agriculture growth was slower and less poverty reducing than before, it said. In urban areas, manufacturing, in particular the garments sector, led the poverty reduction, the report mentioned.
However, slowing down of job creation in manufacturing limited the share of families who could benefit. Poverty rates among self-employed in the service sector also increased, creating a setback on urban poverty reduction. Since the country is facing new and re-emerging frontiers of poverty reduction—urban poverty and a re-emerging east-west divide—the report advocates that by adopting traditional and fresh solutions, Bangladesh can reduce poverty faster.
Finance Minister AHM Mustafa Kamal, the policy makers, General Economics Division (GED) member of the Planning Commission Dr Shamsul Alam, additional secretary to the Statistics and Informatics Division Kishore Kumar Das and Global Director, Poverty and Equality of Global Practice of World Bank Carolina Sanchez Paramo, civil society, private sector and media representatives also were present on the occasion.
