International Monetary Fund has warned that Bangladesh’s economic growth is likely to slow further despite a modest recovery, citing persistent inflation, weak investment, and structural challenges.
The IMF projects GDP growth at 4.7% in FY2026, easing to 4.3% in FY2027—well below the government’s 6.5% target. This highlights a fragile recovery following a sharp slowdown, with growth falling below 4% in FY2025.
Inflation remains a major concern, expected to stay near 9% in FY2026 before gradually declining to around 6% the following year. High prices continue to erode purchasing power and suppress domestic demand.
The IMF also identified structural weaknesses, including a fragile banking sector, low tax revenue, and subdued private investment, as key barriers to stronger growth. Delays in reforms could further limit economic expansion.
External risks such as rising energy costs and geopolitical tensions, particularly in the Middle East, add to the uncertainty by potentially increasing import costs and disrupting supply chains.
Compared to regional peers like India, Bangladesh’s growth outlook remains weaker. However, the IMF noted that growth could recover toward 6% in the medium term if reforms in financial systems, taxation, and exchange rate management are accelerated.
