Citing longstanding banking sector problems like regulatory gaps and widespread loan irregularities as major obstacles to broader economic improvement, the chamber said “several structural issues continue to weigh heavily on recovery”.
Industry chamber MCCI recently said Bangladesh’s economy is showing early signs of recovery, but weak private sector credit growth, falling investments and reduced imports of capital machinery have slowed momentum.
“Several structural issues continue to weigh heavily on recovery,” it said.
Underway reforms will be key to reviving growth and ensuring long-term stability, it noted.
Export earnings in fiscal 2024-25 (FY25) rose by about 9 per cent year on year (YoY) to $48.28 billion, driven mainly by knitwear and woven garments, which accounted for 43.82 per cent and 37.67 per cent of total shipments respectively. This was 97 per cent of the year’s $50 billion target.
However, June 2025, the final month of the last fiscal, saw export earnings drop 8 per cent YoY to $3.34 billion, also 29 per cent lower than May 2025.
Underway reforms aimed at strengthening financial governance and restoring public confidence in banks will be key to reviving growth and ensuring long-term stability, it said in a recent report, titled ‘Review of Economic Situation in Bangladesh April-June 2025 (Q4 of FY25)’.
Though net foreign direct investment (FDI) inflows in July-May of FY25 increased by 17 per cent YoY, to $1.58 billion, MCCI noted that the inflow is low compared to that in many other countries at similar levels of development.
Despite Bangladesh’s low labour costs, foreign investors hesitate to invest due to underdeveloped infrastructure, energy shortages, inconsistent policies, lack of industrial land, corruption and uneven rule enforcement, the MCCI reported observed.
“The overall decline in June 2025 export earnings underscores the challenges, including ongoing global economic uncertainty, falling consumer demand in major markets, logistic issues and tough competition from other manufacturing hubs, facing Bangladesh in the short term,” added the MCCI report.
Fibre2Fashion News Desk (DS)