Euromoney Country Risk

EUROMONEY COUNTRY RISK

Read the latest analysis on sovereign, geo-political and structural risk

 
Get up to date country risk ratings in 186 countries

Member login



Lost your password?

Euromoney Country Risk

Euromoney Country Risk
List of countries.

Bangladesh Bangladesh

Overview Change score Analyses Experts
 
Sponsored section
Bangladesh – Quick View
ECR score33.26 (Mar 2011)
ECR rank125 (Mar 2011)
Economic
GDP (2010)USD 97.77 billion
GNI per capita PPP (2010)USD 1,587
FDI inflow (2010)USD 913.02 million
Inflation (2010)7.3%
Central bank assets (June 2010)USD 15,488.80 million
Unemployment rate (2009)5.1%
Government deficit (2010)USD 4.38 million
Tax revenue (2010)USD 8.76 million
Political
Government typeParliamentary and Democratic
Recent political crisisNA
Economic freedom score (2011)130th
Freedom of information score (2010126th
Corruption perception index (2010)134th
Structural
Birth rate (2008)20.54 per '000
Population balance (2010)Up to 14 years - 33.73%
Population balance (2010)Above 60 years - 6.51%
Life expectancy years (2008)Males – 65.61 years
Life expectancy years (2008)Females – 67.96 years
Mortality rate (2008)6.02 per '000
Literacy rate (2010)60%
Internet access (2007)0.3%

[Top] Economic Overview

Bangladesh is a developing economy supported by the agricultural sector. Over the years, the economy has developed strongly in the industrial sector, especially in readymade garments. This garment industry has now become a significant contributor to the GDP of the country. Moreover, Bangladesh has also seen growth in industries involved in mining and quarrying of natural gas.

 

Major challenges like higher population, along with frequent natural calamities are influencing the overall development of the economy.

(Source: bangladesh-bank.orgPDF file, bangladesh.com, economywatch.com)

 

Gross Domestic Product (GDP)

 

In 2010, Bangladesh reported a GDP of BDT 6,923.80 billion (preliminary) at current market prices, a growth of 12.62% over 2009. Per capita GDP at current prices was BDT 47,405 in 2010.

(Source: Central Bank)

 

Bangladesh GDP and GDP Growth Rate

(Source: Central Bank, MOFPDF file)

Gross National Income (GNI)

 

In 2010, GNI of the country was BDT 7,586.84 billion (preliminary) at current market prices, a growth of 13.12% over 2009. GNI per capita at purchasing power parity (PPP) in 2010 was USD 1,587.

 

(Source: Central Bank, UNDP (pg4)) 

 

Bangladesh GNI and GNI Growth Rate

 

(Source: Central Bank, MOFPDF file)


 Income Tax Rate

 

The Government of Bangladesh levies a minimum tax of BDT 2,000 on all individual taxpayers. However, income tax is further charged on the basis of five income slabs varying from 10% to 25%. Any non-resident person, other than Non-Resident Bangladeshi, is liable to pay fixed tax at 25% of his/her income.

(Source: BOI)


 

Income tax rate for individual taxpayers

Income slabs (BDT)

Tax rate (%)

0-165,000*

0

165,001-440,000**

10

440,001-765,000

15

765,001-1,140,000

20

1,140,001 and above

25

 

*income slab is BDT 0-180,000 for female taxpayers and individuals of age 70 years and above

**income slab is BDT 180,001-440,000 for female taxpayers and individuals of age 70 years and above

 (Source: BOI)

 

Corporate Tax Rate

 

The Government levies a minimum tax of BDT 5,000 on all types of companies/businesses. Income tax varies from 25% to 45%, depending upon the level and type of company/business.

 (Source: BOI)


Corporate Tax Rates

Type of company/business

Tax rate (%)

Publicly traded companies (other than bank, insurance, leasing and other financial institutions)

27.5

Non-publicly traded companies (other than bank, insurance, leasing and other financial institutions)

37.5

Bank, insurance, leasing and other financial institutions

45

Mobile phone operators

45

Dividend or profit withholding

15

Expatriates

25

 

(Source: BOI)


Inflation Rate

 

In 2010, the inflation rate in the country increased to 7.3% from 6.7% in 2009. This rise was mainly due to an increase in food prices. In January 2011, monthly inflation further increased to 9.04%.

(Source: BBSPDF file)

 

Bangladesh Inflation Rate

 

(Source: BBSPDF file, PDF file)


Foreign Direct Investment (FDI)

 

In 2010, total FDI inflows of the country amounted to USD 913.02 million, a decrease of 4.95% from the previous year.

(Source: Central BankPDF file)


 

Bangladesh FDI inflow

 

(Source: Central BankPDF file)

Central Bank Assets

 

As of June 30, 2010, total assets of the Bangladesh Bank (Central Bank) amounted to BDT 1,097,743.4 million.

(Source: Central BankPDF file)


 

Assets of Central Bank as of 30th June (BDT million)

Particulars

2010

2009

Financial Assets

1,062,131,150

894,447,106

Of which:   in foreign currency

743,681,710

512,672,596

                 in domestic currency

318,449,440

381,774,510

Non-financial Assets

35,612,228

31,692,747

Total Assets

1,097,743,378

926,139,853

(Source: Central BankPDF file)

 Non Performing Loan Ratio (NPLR)

 

In 2010 (till June), NPLR of all types of banks in the country was 8.7% of the total loans. NPLR was highest in the case of Development Financial Institutions (DFIs).

(Source: Central BankPDF file)


 

Bangladesh Non-Performing Loan Ratio

 

(Source: Central BankPDF file)

[Top] Financial Indicators & Government Financial

Consumer Price Index (CPI)

 

Annual CPI in 2010 was 221.53 points, a rise of 7.3% over previous year due to an increase in food prices. In January 2011, monthly CPI was reported to be at 242.48 points.

 

(Source: BBSPDF file, PDF file)


 

Annual CPI during 2007-2010

Year

CPI

2010

221.53

2009

206.43

2008

193.54

2007

176.06

 

Base year = 1995-96 = 100

(Source: BBSPDF file, PDF file)

Interest Rate

 

In 2010, the central bank interest rate on deposits was 6.08% and on lending was 8.06%.

(Source: Central Bank)

 

Central bank interest rates (%)

Year

On lending

On deposits

2010

8.06

6.08

2009

4.39

6.29

2008

10.24

7.09

2007

7.37

6.84

2006

11.11

6.99

2005

9.57

5.90

2004

5.74

5.56

2003

8.17

6.25

2002

9.56

6.49

 

(Source: Central Bank)

Money Supply

 

Bangladesh classifies its money supply into two types – M1 and M2, where

 

M1 includes:

  •           Currency outside banks
  •             Deposits of financial institutions with central bank, except Deposit Money Banks (DMBs)
  •           Demand deposits with DMBs (excluding inter-bank and Government deposits)

 M2 includes M1 and time deposits with DMBs (excluding inter-bank and Government deposits).

 (Source: Central Bank)


 

Money Supply (BDT million)

Month

M1

M2

2010

December

999,189

3,992,790

November

978,772

3,946,519

October

927,849

3,852,313

September

918,082

3,790,960

August

900,500

3,730,999

July

861,564

3,643,831

June

879,884

3,630,312

May

827,487

3,522,259

April

793,683

3,430,408

March

775,791

3,375,792

February

759,366

3,343,710

January

753,326

3,279,911

2009

December

753,600

3,281,922

November

768,886

3,229,994

October

696,307

3,125,794

September

713,900

3,120,569

(Source: Central Bank)

Government Expenditure

 

In 2010, total Government expenditure amounted to BDT 1,105.23 million.

 

Bangladesh Government Expenditure

(Source: MOFPDF file,MOFPDF file)

Official Exchange Rate

 

In January 2011, the average exchange rate United States Dollar (USD) was 71.04, against the Euro (EUR) was 94.92 and against the Great British Pound (GBP) was 112.02.

 

Official exchange rates during 2005-2010

Year

USD

EUR

GBP

2011 (January)

71.04

94.92

112.02

2010

69.18

96.24

109.42

2009

68.80

94.52

111.17

2008

68.60

100.96

137.48

2007

69.03

90.17

133.44

2006

67.08

81.74

119.41

 

(Source: Central BankPDF file)

Government finances

 

Government Revenue

 

In 2010, the Government of Bangladesh reported total revenue of 794.84 million. Revenue from taxes was the major contributor to the revenue.

(Source: MOFPDF file,MOFPDF file)


 

Bangladesh Government Revenue

 

(Source: MOFPDF file,MOFPDF file)

Fiscal Balance

 

In 2010, the total Government deficit was BDT 310.39 million, an increase of 24.35% over 2009.

(Source: MOFPDF file)

Tax Revenue

 

In 2010, the Government generated BDT 620.46 million of revenue from taxes. Value Added Tax (VAT) and Income Tax were the main contributors to the tax revenue.

(Source: Central BankPDF file)


 

Tax revenue (2010)

Type of tax

Revenue (BDT million)

Contribution to tax revenue (%)

Value Added Tax (VAT)

24,143.5

38.91

Income Tax

17,047.2

27.48

Supplementary Tax

10,706.7

17.26

Custom Duty

9,410.2

15.17

Excise Duty

347.5

0.56

Other taxes

390.7

0.63

 

(Source: Central BankPDF file)

Current Account Balance

 

In 2010, the current account reported a net balance of USD 3,734 million, an increase of 54.55% over 2009. This increase was mainly because of a rise in exports of goods and services during the year.

(Source: Central Bank)

Balance of Payments

 

In 2010, total trade exports amounted to USD 15,581 million, of which about 79% of exports were readymade garments. During the same year, total income from the provision of services was USD 1,832 million.

(Source: Central Bank)

 

Balance of Payments (USD million)

Particulars

2010

2009

Current Account (Net)

3,734

2,416

Trade Balance

-5,152

-4,710

Services

-1,237

-1,616

Income

-1,487

-1,484

Current transfers

11,610

10,226

Financial Account (Net)

-755

-825

 

(Source: Central Bank)


[Top] Labour Force and Employment Overview

Labour Force

 

In 2009, Bangladesh had an economically active population (labour force) of 53.7 million. Males constituted about 75% of the total labour force. During 2009, the Labour Force Participation Rate (LFPR) was 59.3% in the country.

(Source: PDF file page: 6)


 

Labour Force in 2009 (million)

Economically Active Population

53.7

Employed

51.0

Unemployed

2.7

Not in Labour Force

36.9

(Source: PDF file, page: 6)

Unemployment Rate

 

In 2009, the country had an unemployment rate of 5.1%. Unemployment is mainly seen among females.

(Source: PDF file page: 7)

Employment in Agriculture

 

Employment in agriculture, forestry and fishing was 22.2 million in 2009, constituting 43.6% of the total employed population of the country.

(Source: PDF file, page: 8)

Employment in Industries

 

In 2009, industrial employment was 9 million, constituting 17.6% of the total employed population of the country.

(Source: PDF file, page: 8)

Employment in Services

 

In 2009, the service sector employed 19.8 million of the population, constituting 38.8% of the total employment of the country.

(Source: PDF file page: 8)

Minimum Wage

 

The National Minimum Wage Board of Bangladesh has decided a minimum wage of BDT 1,800 for workers across all industries.

(Source: minimum-wage.org)

In 2010, the average daily wage rate index was 116.68 for males and 118.39 for females.

 

Bangladesh Average Daily Wage Rate Index

Base year = 2006-07 = 100

 

(Source: PDF file)

Level of Unionisation

 

About 3.5% of the total labour force of the country is unionised. There are over 5,000 trade unions, including the Bangladesh Jatio Sramik League, Bangladesh Jatiyatabadi Sramik Dal, the Jatiya Sramik Party and the Bangladesh Free Trade Union Congress.

(Source: nationsencyclopedia.com)

[Top] Political Stability

Bangladesh has a parliamentary form of Government; functioning on the basis of its self drafted constitution. The powers of the Government are divided into executive, legislative and judiciary.

 

The executive powers of the country lie with the President, elected by members of the Parliament (the House of Nation). He is assisted by a Cabinet that is headed by the Prime Minister. The Cabinet also exercises the executive powers under the supervision and control of the President. The Cabinet also stands responsible to the House of Nation.

 

The House of Nation has the legislative powers of the country. It comprises of 300 members, elected by way of direct election and an additional 45 female members are elected by the existing members.

(Source: BBSPDF file, page: 3)

Regulatory Environment

 

Bangladesh is ranked 130th in the 2011 Index of Economic Freedom. Its economic freedom score is 53.0 (out of 100), an increase of 1.9 points from the previous year. The rise in ranking was due to higher business and investment freedom.

 

Bangladesh Economic Freedom Index

 

(Source: heritage.org)

Corruption Perception

 

Bangladesh is ranked 134th in the World’s Corruption Perceptions Index 2010. Its index score is 2.4 (out of 10), reflecting high levels of corruption.

(Source: transperancy.org: Report)

Freedom of Information

 

The country is ranked 126th on the Press Freedom Index 2010. It indicates that the government lay high restrictions on the press.

(Source: rsf.org)

There are around 40 daily newspapers in Bangladesh. The majority of them are published in Bengali and English.

(Source: pressreference.com)

The following is a list of some newspapers published in the country:

 

In Bengali: 

  •            Jugantor
  •              Kaler Kantho
  •            Samakal
  •             The Daily Bhorer Kagoj
  •            The Daily Ittefaq
  •            Amar Desh
  •             Bangladesh Protidin
  •             Jaijaidin
  •             Manabzamin

(Source: bgdportal.com, bgdportal.com)

In English: 

  •            The Daily Star
  •             Bangladesh Journal
  •             Bangladesh Times
  •             Financial Express
  •             The Bangladesh Today
  •             The Daily Independent
  •            The New Nation
  •              The News Today

(Source: bgdportal.com, bgdportal.com)

Judicial System


The judicial system of Bangladesh is divided into four broad categories 

  •             Supreme Court
  •             Appellate Division
  •             High Court Division
  •             District courts

The Supreme Court is the highest authority of jurisdiction, headed by a Chief Justice. The court consists of Appellate and High Court divisions. The Appellate Division hears appeals from the High Court’s order or judgements. The District courts are the local courts, solving and deciding over matters at district level.

(Source: BBSPDF file page: 3)

[Top] Demographic Overview

Bangladesh is a densely populated country with 980 people residing per square kilometre. In 2008, the population of the country was 144.66 million, a growth of 1.40% over 2007. Males constitute 51.22% of the total population. the majority of the population in Bangladesh reside in rural areas.

(Source: BBS (pg1 & 2))

 

 

Bangladesh Population by Gender

 

(Source: BBS (pg1 & 2))

 

Population by age-group, 2008

Age group (years)

Population (%)

0-14

33.73

15-49

52.78

50-59

6.98

60 and above

6.51

 

(Source: BBS, page: 1)


Ethnic Environment

 

About 98% of the people are Bengalis and 2% people are Non-Bengali Muslims or belong to some tribal group.

(Source: state.gov)

By religion, about 89% of the people are Muslims and about 10% are Hindus. People following Buddhism, Christianity and other religions also reside in the country.

(Source: BBS, page: 1)

Birth and Death Rate

 

In 2008, the birth rate of the country was 20.54 births per 1,000 persons. During the same year, the death rate was 6.02 deaths per 1,000 persons.

(Source: BBS, page: 6 & 7)

Infant Mortality Rate

 

In 2009, the infant mortality rate in the country was estimated at 45 deaths per 1,000 live births.

(Source: BBS, page: 16)

Life Expectancy

 

In 2008, life expectancy at the time of birth was 65.61 years in the case of males and 67.96 years in the case of females.

(Source: BBS , page: 7)

Migration and Urbanisation

In 2008, 1.38 per 1,000 population migrated into Bangladesh and 1.86 per 1,000 population migrated outside the country.

(Source: BBS, page: 8)

About 25% of the total population of the country resides in urban areas. In 2008, 17.29 persons per 1,000 population migrated from the rural to the urban areas within the country.

(Source: BBS, page: 1 & 8)

Human Development Index (HDI)

Bangladesh is ranked 129th on the HDI 2010. The HDI provides a composite measure of three dimensions of human development which are measured by life expectancy, adult literacy & enrolment in education and per capita GNP at Purchasing Power Parity (PPP).

(Source: HDR UNDPPDF file)

[Top] Soft Infrastructure

Literacy Rate

 

In 2010, the adult literacy rate (people above age of 15 years) in Bangladesh was estimated at 60%.

(Source: DPE)

Education

 

The General Education system of Bangladesh is broadly divided into primary, secondary and tertiary education. Primary education includes five years of primary schooling. Secondary education comprises of seven years of total schooling divided into junior secondary (three years), secondary (two years) and higher secondary (two years). Tertiary education is classified into education from colleges and universities. College-level formal schooling ranges from 2-6 years depending on the type of degree/course, including bachelors and masters degree. Additionally, there are a number of universities in Bangladesh, offering a variety of formal and informal education.

 

The country also has pre-primary level of education for children up to the age of 6 years. The Ministry of Education also carries out special schooling under the categories – Madrasah Education, Technical – Vocational and Professional Education.

(Source: BANBEIS)

As of 2008, there were 100,974 schools in the country undertaking primary and secondary education. During the same year, the number of public universities was 31 and private universities were 51.

(Source: BANBEIS, BANBEIS)

 

Education resources in Bangladesh (2008)

Level/Type of education

Schools/Institutions

Teachers

Students

Primary

82,218

365,925

16,001,605

Secondary

18,756

219,632

6,819,748

Colleges (general)

3,277

87,715

1,855,633

Madrasah

9,384

13,119

3,559,478

Universities

82

12,585

387,433

Technical-Vocational

3,116

20,703

453,375

Professional

461

6,035

79,970

 

(Source: BANBEIS, BANBEIS, BANBEIS)

Healthcare

 

As of 2010, there are 577 hospitals and health centres in the country, of which 460 hospitals are of primary level.

 

Healthcare resources (2010)

Facilities

Numbers

Hospitals and Health centres

577

Hospital beds

39,341

Physicians

51,993

Dental surgeons

3,913

Nurses

25,018

(Source: DGHSPDF file, page: 1 & 2, PDF file, page: 5 & 6)

In 2010, the Government of Bangladesh spent a total of BDT 8528.47 million on healthcare. The healthcare expenditures were made according to the 19 operational plans developed by the Directorate General of Health Services (DGHS).

(Source: DGHSPDF file)