To meet its goal of reaching middle-income status by 2021, the 50th anniversary of its independence, Bangladesh needs to accelerate growth from its current rate of 6 percent to more than 8 percent a year. Accelerating growth will inevitably require a significant urban transformation, as urbanization and economic growth occur in tandem. Indeed, no country has ever reached middle-income status without urbanizing.
Strong economic growth has sustained and fueled urbanization in Bangladesh. But the urban transition is not yet yielding all of its potential economic benefits. The economic, social, and environmental costs of unmanaged urban development— slums, traffic, crime—are increasing. Failure to address them could prevent Bangladesh from meeting its goal.
The study presents new and robust empirical evidence on the drivers of and constraints to urban competitiveness through the lens of the garment sector—an industry that has thrived in Bangladesh’s urban areas. It does so by presenting the results of a survey of 1,000 garment firms carried out across six locations in Dhaka and Chittagong. The study finds that, to accelerate growth, Bangladesh needs cities that are more capable of innovating, better connected internally and with the global economy, and more livable.
The study strengthens the knowledge base for understanding the economic and spatial dynamics of urbanization in Bangladesh. It helps decision makers think through the costs and benefits of policies intended to spur growth and achieve sustainable development of Bangladesh’s cities. I hope it will foster timely dialogue on the urban policy directions that will best support Bangladesh’s aspiration to reach middle-income country status by 2021.
Acting Country Director for Bangladesh and Nepal