NDB Capital plays an important role in developing the capital market of Bangladesh
Bangladesh, considered by many to be the rising star of South Asia, has shown resilient macro-economic performance even during the recent global economic crisis. Unlike comparable developing countries, Bangladesh has been able to impress with its notable improvements in various social and human development indicators simultaneously (see Fig. 1). In fact, Bangladesh has been successful in continuously developing its human resources, female empowerment and living standard improvements. This has made the country a unique proposition as a model for growth.
One important outcome of Bangladesh’s unique growth pattern is that it has been successfully shaping the domestic market as a robust shield against various external economic shocks. How so? Dissimilar to its regional counterparts, the economic growth of Bangladesh has not expanded the economic divide – rather the effects of the growth have been distributed evenly both in monetary and non-monetary forms. The result is a rising relative share of the middle-income segment along with a growing per capita income. Consequently, not only is the purchasing power of people increasing but also the consumer base is expanding. This strengthening domestic demand has been one big contributing factor in keeping the economy afloat even during difficult periods.
Another reinforcing factor in the Bangladeshi growth story is the composition of its population. The majority of the population is concentrated within the ‘working age’ category and the relative share of this age category is on the rise.
According to the World Bank, the working age (15-64 years) population reached 64.2 percent in 2012, up from 53.9 percent in 1990. Within the same time period, the dependent population (below 15 or above 64 years) as a percentage of working age population has dropped considerably, from 85 percent to 54.53 percent. Given the country’s labour costs are already one of the lowest globally, this growing labour force (see Fig. 1) and declining dependent population percentage guarantees a persistent labour cost competitiveness in various labour-intensive sectors.