The relationship between the Government of Bangladesh and The World Bank has played an instrumental part in facilitating the nation’s advancement towards economic growth and development. Over the course of fifty years, the World Bank has functioned as a pivotal development collaborator for Bangladesh, furnishing assistance and funding to surmount impediments to advancement and affluence. Since 1972, the World Bank has committed over $35 billion to support Bangladesh’s development journey.
In recent years, Bangladesh has made noteworthy progress and is currently regarded as one of the rapidly developing economies worldwide, despite its previous status as one of the most impoverished nations globally. The aforementioned alteration can be attributed to the steadfast dedication of Bangladesh towards advancement, coupled with the unrelenting assistance provided by the World Bank.
Importance of the partnership in recent global scenario
In the aftermath of the pandemic-induced economic downturn, nations worldwide are contending with the complexities of post-Covid economic reconstruction as the global economy endeavours to recuperate. The ongoing conflict in Ukraine has resulted in significant complexities, exerting immense strain on worldwide supply chains, energy, food, and infrastructure sectors. Notwithstanding the obstacles, Bangladesh has demonstrated unwavering dedication towards advancing its development agenda, persistently pushing forward with its developmental endeavours.
The World Bank, in its capacity as a custodian of the international economy, holds a pivotal responsibility in facilitating Bangladesh’s pursuit of achieving excellence. The partnership between Bangladesh and the World Bank holds immense significance. The World Bank has recently expressed interest in investing and collaborating with Bangladesh, citing its suitability in the current unstable economic climate.
Country Partnership Framework
The World Bank intends to provide financial assistance to Bangladesh to aid in its pursuit of attaining upper-middle-income status by the year 2031. The country partnership framework has been formulated with the aim of fostering sustainable economic growth, enhancing resilience to climate change, and augmenting human capital development, all of which are integral constituents of Bangladesh’s enduring economic agenda.
The new country partnership projects
The World Bank has taken notice of Bangladesh’s noteworthy economic expansion, ability to withstand challenges, and persistence as the key drivers of interest. The recent allocation of $1.25 billion in financing by the Bank towards sustainable and resilient growth in Bangladesh serves as evidence of the Bank’s recognition of the country’s economic significance.
The World Bank’s Board of Executive Directors has recently approved a $1.25 billion financing for Bangladesh, which will be allocated to three new projects covering the years 2023-2027. The projects will support the country in achieving its goal of becoming an upper-middle-income country by 2031, as outlined in the government’s Eighth Five-Year Plan and the Long-Term Perspective Plan 2021–2041.
The first project is the Program on Agricultural and Rural Transformation for Nutrition, Entrepreneurship and Resilience (PARTNER) project, which will receive $500 million. It will promote diversification, food safety, entrepreneurship, and climate resilience in agri-food systems. The second project is the $500 million First Green and Climate Resilient Development Credit, which will assist the country in transitioning to green and climate-resilient development. Lastly, the $250 million Sustainable Microenterprise and Resilient Transformation (SMART) project will transform the micro-enterprise sector into a more dynamic, less polluting, resource-efficient, and climate-resilient growth sector.
These projects aim to address key barriers to higher and sustainable growth, including the development of a diversified and competitive private sector, promoting socioeconomic inclusion, and addressing climate and environmental vulnerabilities. Bangladesh’s partnership with the World Bank began in 1972 with a $50 million credit and has since received over $38 billion in financing. The World Bank’s ongoing program in Bangladesh has provided $16.3 billion, while the Multilateral Investment Guarantee Agency (MIGA) has a current program of just over $1 billion, and the International Finance Corporation (IFC) has an ongoing program of about $1 billion.
The outcomes of the projects
Agricultural and Rural Transformation for Nutrition, Entrepreneurship and Resilience (PARTNER) Project
The PARTNER initiative aims to tackle the obstacles encountered by rural populations in Bangladesh through a focus on agricultural and rural transformation, with an emphasis on nutrition, entrepreneurship, and resilience. The susceptibility of the nation’s economy, which is reliant on agriculture, to natural calamities and climate variability, coupled with the persistent issue of malnourishment, poses a considerable challenge. The objective of the Partner programme is to advance sustainable agricultural practises, enhance nutritional outcomes, foster rural entrepreneurship, and fortify resilience against the effects of climate change.
In addition, the Partner programme has the potential to mitigate the issue of sustainability through the advocacy of sustainable agricultural techniques that minimise ecological deterioration, enhance soil quality, and augment crop productivity. Enhanced agricultural yields can result in increased revenue for farmers and improved food security for the populace. The programme aims to enhance nutritional outcomes through the promotion of nutrient-dense food production and consumption, as well as the provision of nutrition education to farmers and communities. The implementation of this measure is expected to mitigate malnutrition and enhance the general well-being of rural communities.
Moreover, the partner programme has the potential to facilitate rural entrepreneurship through the provision of financial resources, business education, and market connections for smallholder farmers and agribusinesses. The implementation of this initiative is expected to facilitate the enhancement of the financial status of rural entrepreneurs and foster their contribution to the national economy.
Nevertheless, the PARTNER initiative is expected to enhance the capacity to withstand the effects of climate change, such as floods and droughts, by imparting knowledge and assistance to implement climate-resilient techniques. The implementation of this strategy is expected to facilitate the adaptation of farmers to the dynamic climate conditions and mitigate their susceptibility to environmental calamities.
First Green and Climate Resilient Development Credit Initiative
Bangladesh is considered to be highly susceptible to the impacts of climate change, as evidenced by the current affliction of more than 7.1 million individuals, with projections indicating that this figure will escalate to 13.3 million by the year 2050. The annual cost of climate change impacts, such as tropical cyclones, is estimated to be approximately $1 billion for the country. The implementation of the First Green and Climate Resilient Development Credit (FCRDC) has the potential to facilitate Bangladesh’s shift towards sustainable and climate-resilient development.
Furthermore, the FCRDC advocates for sustainable development practises aimed at mitigating greenhouse gas emissions and safeguarding natural habitats. The recommendation is for Bangladesh to allocate resources towards developing infrastructure that is resilient to the effects of climate change, such as inundations and rising sea levels. The Financial Centre for Resilient Development Cooperation (FCRDC) facilitates the mobilisation of financial resources for projects that promote sustainable and climate-resilient development. This is achieved through fostering collaboration among various stakeholders, including governments and financial institutions.
In addition, the FCRDC facilitates capacity-enhancement endeavours in Bangladesh through the provision of technical aid and instruction to cultivate indigenous proficiency and comprehension on sustainable development and climate resilience. The FCRDC contributes to the promotion of sustainable economic and environmental development in Bangladesh, with a view to enhancing the country’s resilience to the impacts of climate change.
Sustainable Microenterprise and Resilient Transformation (SMART) Project
The SMART initiative aims to assist Bangladesh in enhancing its capacity to withstand the effects of climate change by promoting sustainable microenterprise and fostering resilience. The programme is designed to focus on microenterprises with the objective of advancing sustainable and climate-resilient practises, enhancing financial accessibility, fostering climate resilience, and empowering female entrepreneurs. The initiative aims to promote the growth of sustainable microenterprises, facilitate the availability of funds for investments that enhance climate resilience, facilitate the adoption of climate-resilient practises by microenterprises, and give priority to the economic empowerment of women. The SMART initiative has the potential to make a substantial contribution towards the establishment of sustainable livelihoods, poverty reduction, and the development of a more sustainable and prosperous future for Bangladesh.
To conclude, the enduring collaboration between Bangladesh and the World Bank spanning five decades has played a pivotal role in fostering the nation’s progress and advancement. The World Bank’s recent approval of three new projects and the implementation of the Country Partnership Framework (CPF) are expected to contribute significantly to Bangladesh’s progress towards achieving upper-middle-income status by 2031. The CPF’s synchronisation with the government’s developmental strategies and emphasis on tackling significant impediments to sustainable expansion will facilitate the advancement of socioeconomic integration, climate adaptability, and a varied and competitive corporate domain. The efficacy of the partnership is evidenced by the triumph of past undertakings, and as Bangladesh persists in its pursuit of economic eminence, its collaboration with the World Bank will continue to be of paramount importance. Prospects for the future appear promising.