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ISLAMABAD, Jan 28 (APP):Renowned Japanese development economist Prof. Yamagata Tatsufumi on Tuesday said that Bangladesh has successfully transformed itself from a traditional South Asian economy into an export-oriented “East Asian–style” industrial powerhouse, offering valuable lessons for Pakistan and other countries in the region.
Speaking at a special guest lecture titled “Bangladesh as an East Asian Country: Its Pattern of Industrial Development,” co-hosted by the Sustainable Development Policy Institute (SDPI) and the Embassy of Japan, Prof. Yamagata highlighted that Bangladesh’s high-intensity, labour-driven industrialisation model has enabled it to outperform several regional peers in exports.
The lecture, attended by policymakers, researchers and development practitioners both in person and online, focused on regional industrialization, export competitiveness and labor-intensive growth.
Opening the session, Dr. Abid Qaiyum Suleri, Executive Director SDPI, said that Bangladesh’s development experience is particularly relevant for Pakistan due to strong similarities in natural resource endowments and economic structure. He noted that Bangladesh’s strategic shift towards an East Asian development model helped expand its export share and significantly increase women’s participation in the workforce.
Dr. Suleri observed that Pakistan and Bangladesh were once competitors in sectors such as bicycle exports, but Bangladesh has since captured a substantial share of that market. He described the Japanese expert’s perspective on Bangladesh’s economic transformation as eye-opening for South Asian countries and in line with SDPI’s mandate to promote evidence-based policymaking.
In his lecture, Prof. Yamagata argued that while Bangladesh is geographically a South Asian country, its development pattern increasingly resembles that of East Asia. He amid drawing on his experience as a visiting fellow at the Bangladesh Institute of Development Studies, challenged the race to the bottom argument that attributes the growth of Bangladesh’s apparel exports solely to labor exploitation. Instead, he described the ready-made garments sector as a window for diversification and a foundation for broader industrial development.
He said Bangladesh serves as a natural reference point for Pakistan, noting historical complementarities along the textile value chain, where Pakistan has strength in upstream segments while Bangladesh has built competitiveness in downstream manufacturing.
According to Prof. Yamagata, Bangladesh is comparable to Pakistan across several economic indicators and is gradually catching up with India, while also narrowing the gap with China in apparel exports to the European Union.
He also noted that garments account for nearly 80 percent of Bangladesh’s total exports, with the country now emerging as the third-largest textile exporter to the United States after China and Vietnam. He highlighted that minimum wages in the apparel industry, after declining between 1985 and 2005, have shown a consistent upward trend since 2005, with real wages rising through 2023.
Prof. Yamagata explained that Bangladesh’s competitiveness stems from being a labor-abundant and land-scarce economy, a characteristic closer to East Asia than South Asia. This, he said, has enabled Bangladesh to excel in labor-intensive industries and gradually move toward diversification. He cited the growing assembly of electrical appliances, exports of refrigerator and air-conditioner compressors to Europe, and expansion into transport equipment, including bicycles, shipbuilding and drone manufacturing. Bangladesh is now the fourth-largest exporter of bicycles to Europe, he added.
He also shared data on Bangladesh’s exports to the EU, which include garments, jute and other fibers, tea and spices, pharmaceuticals, bicycles and prepared unrecorded media such as USBs and memory cards. Emerging sectors like pharmaceuticals and electronics, he added, signal gradual industrial diversification beyond garments.
During the question-and-answer session, Prof. Yamagata discussed challenges linked to Bangladesh’s upcoming graduation from Least Developed Country (LDC) status, particularly for the pharmaceutical sector, which will face changes in regulatory and trade conditions.
He noted that Bangladesh is preparing for LDC graduation and that recent agreements with Japan, including discussions on tariff reductions under an Economic Partnership Agreement, indicate confidence in the economy’s readiness. He also pointed to growing foreign investment interest, particularly from China, while noting that Bangladesh’s export base remains heavily concentrated in textiles, accounting for about 81 percent of exports.
Speaking on the occasion, Ambassador of Japan to Pakistan, Akamatsu Shuichi, said Bangladesh’s industrial development provides an interesting reference for Pakistan, especially given shared challenges such as labor abundance and the need for diversification. He stressed that South Asian countries must create opportunities to productively absorb their growing labor force and translate demographic trends into sustained economic growth.