Questionable BBS GDP Statistics

[Destranator]

Not gonna happen unless some
At the end of the day, these agencies take a long-term realistic view of the corruption in 3rd world countries, they know that govts. around the world are fudging data, and they have their own special way of extrapolating real data. from the fake data reported by govts. like Bangladesh and others.

Unfortunately IMF and WB cannot compensate for unreliable data through "extrapolation" while sitting in their cosy offices in DC.

GDP calculations require data collection through months and months of field surveys. Foreign agencies do not have the resources or jurisdiction to carry out such surveys.
Making BBS independent is indispensable so that they have the freedom to disclose their survey data for experts to scrutinise step by step.

 

[Bilal9]

Unfortunately IMF and WB cannot compensate for unreliable data through "extrapolation" while sitting in their cosy offices in DC.

GDP calculations require data collection through months and months of field surveys. Foreign agencies do not have the resources or jurisdiction to carry out such surveys.
Making BBS independent is indispensable so that they have the freedom to disclose their survey data for experts to scrutinise step by step.

So the question then remains, who is going to bell the cat, i.e. make BBS "independent"?

Won't be Ms. Hasina, that's for sure. I don't know if in the future, loan disbursers make it a condition of their loans, maybe that should work.

By that time (ten year timeframe), Bangladesh will be able to fund most projects (except mega ones) from its own pocket, so corruption will always remain.

 

[Destranator]

So the question then remains, who is going to bell the cat, i.e. make BBS "independent"?

Won't be Ms. Hasina, that's for sure. I don't know if in the future, loan disbursers make it a condition of their loans, maybe that should work.

By that time (ten year timeframe), Bangladesh will be able to fund most projects (except mega ones) from its own pocket, so corruption will always remain.

Hopefully at some point we will get leaders who do not look cheap gratification through imflated numbers. Mannan is already making noises around making BBS independent but he is weak.

 

[bluesky]

Hopefully at some point we will get leaders who do not look cheap gratification through imflated numbers. Mannan is already making noises around making BBS independent but he is weak.

In BD, there is not even judicial independence. So, the BBS independence is non-attainable.

I just hope, our Mustafa Kamal suddenly does not declare BD's next FY2021-2022 GDP at $511 billion next July. He may have a good excuse to do so.

He would say that the base year has been revised to 2020 and as a result of this new base year, the GDP is up at $511 billion.

Oh!!! Half a trillion-dollar GDP!! Not bad. Joi Bangladesh!!!

 

[bluesky]

So the question then remains, who is going to bell the cat, i.e. make BBS "independent"?

Won't be Ms. Hasina, that's for sure. I don't know if in the future, loan disbursers make it a condition of their loans, maybe that should work.

By that time (ten year timeframe), Bangladesh will be able to fund most projects (except mega ones) from its own pocket, so corruption will always remain.

GDP has been raised from something like another fictitious $320 billion to $411 billion. But the Tax to GDP (new) ratio has decreased proportionately as a percentage of GDP.

Now with this kind of tax collection, how do you expect big projects to be financed by the govt? With about 8% of tax vs GDP, the collection is so small that the GoB cannot really do so.

So, it will keep on depending upon borrowing from foreign sources. This will stop at a time when the amount of repayment becomes more than the amount of borrowing.

This is the end of BD progress unless our garments exports rise to $100 billion in the next ten years.

Please take note of the cases of Pakistan and SL. Mathematics deals with real numbers and not imaginary numbers.

 

[Destranator]

BBS still faces challenges in imparting timely, credible data​

As the Bangladesh Bureau of Statistics observes National Statistics Day-2022 today for the second year running, questions remain over how much the country’s premier agency for statistics has been able to keep to its missions of providing accurate, standardised and timely statistics since 1974. The photo was taken yesterday. Photo: Palash Khan
Without big data, you are blind and deaf and in the middle of a freeway.
This observation came from American author Geoffrey Alexander Moore. But it is quite pertinent for today's Bangladesh since there is an absence of timely and reliable data. Forget about "big data".

And this puts the Bangladesh Bureau of Statistics (BBS), the country's premier statistical agency, in the spotlight.
When a researcher or individual is interested to know more about Bangladesh's economic or social situation, they must turn to the BBS. But it is the government that needs credible data in a timely manner to make informed decisions.

"Providing accurate, standardised and timely statistics" has been one of the missions of the BBS since it began its journey in independent Bangladesh in 1

"The BBS has come a long way in terms of institutional and administrative capacity and expanding the coverage, frequency and reliability of statistics," said Zahid Hussain, a former lead economist of the World Bank's Dhaka office.
"There was a time when one had to visit the BBS office to collect inflation data. Now you can get them online."

The BBS is responsible for carrying out statistical programmes such as censuses on population, agriculture, manufacturing industries and establishments as well as other national surveys such as labour force, demographic situation, and household income and expenditure.
The agency is observing the National Statistics Day-2022 today, for the second year running.
Forty-eight years have passed but the BBS is still facing criticisms for its failure to produce data on time and maintain credibility due to a lack of proper management and political will.
Because of one of its failures, the sixth population census is set to see further delays as the state-run agency could not conduct it as scheduled even though four years have passed since drawing up a master plan.
The census, which is performed once a decade, offers complete data on population, its composition, workforce, density, housing and other socioeconomic indicators which are vital for formulating economic and other policies.
The last census was conducted in 2011, when the country's population stood at 15.17 crore. Currently, the estimated population is 16.8 crore, according to the Bangladesh Economic Review 2021.
The statistical agency prepared the master plan in 2018 and was supposed to publish a preliminary report on the exercise by July last year. In January 2021, it pushed back the date to October 25-31, but there has not been much headway, said BBS sources.
The BBS has also failed to ensure timely generation of the data on agriculture production.
Speaking to The Daily Star, Prof Md Aynul Islam, general secretary of the Bangladesh Economic Association, said reliable data is a key component for informed policymaking.
"The BBS is the sole authority to provide data in Bangladesh. But several data are not provided in a regular manner, which makes it difficult to make informed policy decisions."
Islam pointed out that the GDP figures provided by the BBS have faced questions recently.
"There is a general perception among the researchers that GDP figures in Bangladesh are overestimated. So, the BBS needs to win the trust of people. This issue should be addressed properly."
Similarly, the Household Income Expenditure Survey (HIES), which is supposed to be conducted every five years, is now seven years old.
The survey was due in 2015. The BBS completed it in 2016-17, meaning when data were finally made available, they were already three years old.
"The next HIES survey was scheduled in 2020. It is 2022, and we do not have any information on the survey," Islam said.
During the coronavirus pandemic, the dearth of updated data posed challenges to the government as there is no information on the number of new poor or job losses. But the information is important to design stimulus packages and other policies targeting poverty and vulnerability.
The labour force data used to be published quarterly. But after 2015 and 2016, it was discontinued.
The BBS was also given the responsibility to conduct a census to develop the National Household Database, which will be used to improve the beneficiary selection process for social security programmes. The agency conducted the census in 2017 but has not released the data yet.
"The data had become outdated even before their release," Islam added.
Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh, also lauded the BBS for publishing updated data.
"However, the BBS should work independently and be accountable to the parliament. Its data should not be reviewed by any political parties or approved by a cabinet meeting, as it is a sensitive issue."
Prof Selim Raihan, executive director of the South Asian Network on Economic Modelling, says the BBS has some success in generating and publishing data and carrying out surveys.
"Its performance is better than many developing countries in the Asia-Pacific region."
However, there are shortcomings.
"Not only research organisations, but many government officials have admitted to a lack of qualitative data," said Raihan, a professor of economics at the University of Dhaka.
In a broader sense, after 48 years of the BBS's journey, it is still not in a good position. The role of the state-run agency has become even more important at a time when the government is working to achieve the Sustainable Development Goals.
"Willingness to work is a major issue to overcome the situations rather than funding," said Prof Raihan.
BBS Director-General Mohammad Tajul Islam could not be contacted for comments.
Zahid Hussain says a country needs statistics to assess development strategies.
"But when statistics are not available at regular intervals, you will face difficulty and then you will have to make a guess relying on whatever information you have."
"Statistics have not been available at regular intervals despite reforms and various projects."
Hussain says so far, there has been no controversy about poverty and employment data. "But there is a question about GDP growth, inflation and even agriculture production figures."
"I don't know how many people trust the inflation data of the BBS because consumers see a different picture when they go to the kitchen markets. So, the BBS has to publish important statistics regularly, and the problem related to credibility has to be overcome."
"Overall, there has been progress in terms of access and coverage of data, but the BBS still has a long way to go," Hussain added.

BBS still faces challenges in imparting timely, credible data

Without big data, you are blind and deaf and in the middle of a freeway.

www.thedailystar.net

 

[UKBengali]

Can this thread by finally closed as it seems to have run past it's sell by date now?

BD is on target for near 60 billion US dollars of exports this fiscal and the increase in GDP per capita PPP is in line with BBS GDP growth statistics.

GDP per capita PPP cannot be manipulated and so that puts paid to any chance of BD manipulating it's GDP statistics over the last decade.

Also, IMF would have already flagged this in it's reports if BD GDP growth reports were not credible as it has done in the past with other countries like Myanmar, and laymen should not think they know better than major international economic forecasters.

 

[Destranator]

Data deception weakens policies​

Helal Uddin Ahmed | Published: March 07, 2022 21:29:32 | Updated: March 09, 2022 23:02:05
The average per capita income in Bangladesh was US$ 1,909 at the start of 2019-20 fiscal-year. Later, Bangladesh Bureau of Statistics (BBS) informed on August 11, 2020 that the per capita income had risen to US$ 2,064 in line with a GDP growth rate of 5.24 per cent during that fiscal-year. After that, the per capita income was shown to be US$ 2,227 at the end of 2020-21, which was followed by another BBS claim in November 2021 that the figure had crossed US$ 2,500. And according to the latest estimates of BBS, the per capita income rose by USD 327 to stand at US$ 2,554 at the end of 2021-22 fiscal-year. But this latest figure has not been the finding of any new survey or improvement in economic indices. Rather, it is mainly an outcome of changing the base year for calculation of GDP from the previous 2005-06 to the newly-set 2015-16 with effect from 2020-2021.

According to many economists, the BBS does not properly take into account the negative impact of inflation while calculating national income, labour income, household income etc. Besides, the GDP and per capita income can also be inflated by showing lesser population, as GDP has to be divided by population for arriving at per capita income figures. Whereas most observers including development partners opine that the country's population is over 180 million now, the BBS shows it to be 163 million. As there has not been any population census in the country since 2011, the actual population as well as population growth rate of Bangladesh appears to be ambiguous and BBS has not done anything concrete to allay the suspicions. As in the past, its principled position appears to be satisfying the whims of relevant authorities or pleasing them with bloated figures instead of acting as truth-seekers with regard to socio-economic data of the country.

Estimation of national income accounts in Bangladesh is one of the core functions of 'Bangladesh Bureau of Statistics' (BBS). Initially, national income accounting was a joint activity of BBS and Planning Commission. Since 1975, BBS has been engaged in calculating national accounts entirely on its own. It started compiling and publishing GDP and other national income accounting aggregates in 1972 by following production and expenditure
approaches in line with the concepts and classifications of the 1968 UN System of National Accounts (SNA-1968). The fiscal-year 1972-73 was used as the base year for constant price estimates until 1988-89. The base year was then changed to 1984-85 in 1988-89; 1995-96 in 2000; and lastly 2005-06 in 2013 by adhering to the stipulations of SNA-1993.

Now, 2015-16 is being used as the new base-year with effect from July 2020 by following the latest system of national accounting (SNA-2008). As a result, the number of sectors measured has jumped to 24 from the previous 15, thereby expanding the scope of GDP. The new sectors are: mobile and agent banking; dairy and poultry farming; nurseries; latkon-dragonfruit-strawberry, capsicum and mushroom; housing; cable television; internet; and helicopter service. But many observers have challenged BBS by claiming that these sectors were already taken into account in the past in one form or another under sectors like banking, agriculture and industries. Consequently, no direct linkage can be logically established between the changes in base-year for GDP calculation and its large-scale boom.

Economists also complain about the method adopted by BBS for CPI (consumer price index)-based calculation of inflation. There are allegations that the annual average inflation rate is shown to be less by undertaking surveys at opportune moments when produced crops are harvested or there is lesser food inflation. Besides, the household income is also shown to be more as inflation is not deducted. Moreover, non-food inflation is allegedly shown to be less in years when the food inflation becomes excessive.

Criticisms have often come by the country's leading think-tanks regarding the system of GDP measurement in Bangladesh as well as its credibility. Questions were raised about the quality of GDP statistics during a discussion held at Bangladesh Institute of Development Studies (BIDS) in 2019-20. GDP growth rate can be judged or evaluated from two perspectives. One is income inequality, which is constantly getting worse in Bangladesh as revealed by official data. The other is employment, which has not improved despite claims of high growth rate. A similar
analysis made by the South Asian Network on Economic Modelling (SANEM) claimed there was lack of consistency between remittances and high growth. The high industrial growth as shown by official GDP figures also did not match with the figures for private investments. Besides, the gradual decline in incremental capital output ratio also raises questions, as Bangladesh ranks very poorly in the global cost of doing business chart.

A previous analysis by the Centre for Policy Dialogue showed that despite claims of high growth rate, commensurate contributions to GDP by relevant sectors were not being observed. As there have not been sufficient investments against high growth, the labour productivity should have risen. But no technological or innovative transformation has taken place in Bangladesh in recent times that could enhance the productivity radically. The workers' income should also have increased in case of productivity improvement. But even official data show the reverse to be true. The GDP shown by BBS has not at all been realistic in recent times and CPD sought explanation from BBS on how GDP was being calculated.

This controversy surrounding GDP in Bangladesh had especially become acute during the previous decade in the wake of worsening democratic deficits in the country. For example, the growth in agriculture sector was negative and the remittances also decreased in 2015-16, but the growth rate was shown to be 7.11 per cent. The growth rate was again shown to be 7.28 per cent in 2016-17, but the remittances had decreased by over 14 per cent and the export growth was marginally above 1 per cent. The growth rate was then shown to be 7.86 per cent in 2017-18 following initial projection of 7.65 per cent despite negligible increases in productive capacity, investment and employment.

The GDP data claimed by BBS have not been realistic even in recent times, as evident from the provisional figures for 2019-20 that showed a growth of 5.24 per cent amid the Covid-19 pandemic. The whole country was under an informal lockdown (general holiday) from March 26 to May 29, and mostly the
garments factories were opened in the manufacturing sector in June. Besides, the hotels and restaurants, construction and transport sectors by and large remained closed during the March-June quarter. But instead of showing a negative growth, the manufacturing, construction, hotels & restaurants, and transport, storage & communication sectors (accounting for 44 per cent of GDP) were shown by BBS to have recorded growth rates of 5.48 per cent. 9.06 per cent per cent, 6.46 per cent and 6.19 per cent respectively. These figures also contradicted significant declines in two other indicators, viz. exports and revenue collection, which are usually positively correlated to GDP. Besides, BBS itself claimed that there had been 82 per cent fall in manufacturing output during April 2020, which was most likely to hold true for May as well because of the general holiday. Ultimately, BBS had to concede its lapses when the final GDP growth rate figure for 2019-20 was shown to be 3.51 per cent.

The country's leading economists have all along raised questions about the authenticity of GDP figures provisionally announced by BBS, even claiming that growth rate figures have now assumed the shape of a political number. A CPD executive director had commented in the past, "A kind of infatuation appears to have grown among the country's policy-makers regarding growth. Growth data are therefore being used politically. Exaggerating growth cannot be beneficial; it does not help policy-making". Even a former secretary of the statistics division claimed at a citizens' dialogue in 2019 that she had seen how development-related statistics were polished or doctored during her tenure. The problem becomes even more acute when an authoritarian regime tries to paint a rosy picture of the economy in an attempt to hide its democratic deficits.

It is sad that Bangladesh has not yet been able to develop a credible statistical system even after 50 years of existence. This lack of credibility of statistical methods needs to be addressed swiftly. There should be a transparent dialogue on the subject by involving all stakeholders, in addition to streamlining the statistical system. Otherwise, the real picture of the country's socio-economic growth can never
be gauged properly, which in turn proves to be a hindrance to adopting development policies and programmes and undertaking policy analysis in a realistic and logical manner.

Dr. Helal Uddin Ahmed is a retired Additional Secretary and former Editor of Bangladesh Quarterly. hahmed1960@gmail.com









----------------------------




Someone needs to learn how Purchasing Power Parity calculations work.
Dodgy data × PPP multiplier = credible data!!! Genius.

 

[PoondolotoPandalum]

Data deception weakens policies​

Helal Uddin Ahmed | Published: March 07, 2022 21:29:32 | Updated: March 09, 2022 23:02:05
The average per capita income in Bangladesh was US$ 1,909 at the start of 2019-20 fiscal-year. Later, Bangladesh Bureau of Statistics (BBS) informed on August 11, 2020 that the per capita income had risen to US$ 2,064 in line with a GDP growth rate of 5.24 per cent during that fiscal-year. After that, the per capita income was shown to be US$ 2,227 at the end of 2020-21, which was followed by another BBS claim in November 2021 that the figure had crossed US$ 2,500. And according to the latest estimates of BBS, the per capita income rose by USD 327 to stand at US$ 2,554 at the end of 2021-22 fiscal-year. But this latest figure has not been the finding of any new survey or improvement in economic indices. Rather, it is mainly an outcome of changing the base year for calculation of GDP from the previous 2005-06 to the newly-set 2015-16 with effect from 2020-2021.

According to many economists, the BBS does not properly take into account the negative impact of inflation while calculating national income, labour income, household income etc. Besides, the GDP and per capita income can also be inflated by showing lesser population, as GDP has to be divided by population for arriving at per capita income figures. Whereas most observers including development partners opine that the country's population is over 180 million now, the BBS shows it to be 163 million. As there has not been any population census in the country since 2011, the actual population as well as population growth rate of Bangladesh appears to be ambiguous and BBS has not done anything concrete to allay the suspicions. As in the past, its principled position appears to be satisfying the whims of relevant authorities or pleasing them with bloated figures instead of acting as truth-seekers with regard to socio-economic data of the country.

Estimation of national income accounts in Bangladesh is one of the core functions of 'Bangladesh Bureau of Statistics' (BBS). Initially, national income accounting was a joint activity of BBS and Planning Commission. Since 1975, BBS has been engaged in calculating national accounts entirely on its own. It started compiling and publishing GDP and other national income accounting aggregates in 1972 by following production and expenditure
approaches in line with the concepts and classifications of the 1968 UN System of National Accounts (SNA-1968). The fiscal-year 1972-73 was used as the base year for constant price estimates until 1988-89. The base year was then changed to 1984-85 in 1988-89; 1995-96 in 2000; and lastly 2005-06 in 2013 by adhering to the stipulations of SNA-1993.

Now, 2015-16 is being used as the new base-year with effect from July 2020 by following the latest system of national accounting (SNA-2008). As a result, the number of sectors measured has jumped to 24 from the previous 15, thereby expanding the scope of GDP. The new sectors are: mobile and agent banking; dairy and poultry farming; nurseries; latkon-dragonfruit-strawberry, capsicum and mushroom; housing; cable television; internet; and helicopter service. But many observers have challenged BBS by claiming that these sectors were already taken into account in the past in one form or another under sectors like banking, agriculture and industries. Consequently, no direct linkage can be logically established between the changes in base-year for GDP calculation and its large-scale boom.

Economists also complain about the method adopted by BBS for CPI (consumer price index)-based calculation of inflation. There are allegations that the annual average inflation rate is shown to be less by undertaking surveys at opportune moments when produced crops are harvested or there is lesser food inflation. Besides, the household income is also shown to be more as inflation is not deducted. Moreover, non-food inflation is allegedly shown to be less in years when the food inflation becomes excessive.

Criticisms have often come by the country's leading think-tanks regarding the system of GDP measurement in Bangladesh as well as its credibility. Questions were raised about the quality of GDP statistics during a discussion held at Bangladesh Institute of Development Studies (BIDS) in 2019-20. GDP growth rate can be judged or evaluated from two perspectives. One is income inequality, which is constantly getting worse in Bangladesh as revealed by official data. The other is employment, which has not improved despite claims of high growth rate. A similar
analysis made by the South Asian Network on Economic Modelling (SANEM) claimed there was lack of consistency between remittances and high growth. The high industrial growth as shown by official GDP figures also did not match with the figures for private investments. Besides, the gradual decline in incremental capital output ratio also raises questions, as Bangladesh ranks very poorly in the global cost of doing business chart.

A previous analysis by the Centre for Policy Dialogue showed that despite claims of high growth rate, commensurate contributions to GDP by relevant sectors were not being observed. As there have not been sufficient investments against high growth, the labour productivity should have risen. But no technological or innovative transformation has taken place in Bangladesh in recent times that could enhance the productivity radically. The workers' income should also have increased in case of productivity improvement. But even official data show the reverse to be true. The GDP shown by BBS has not at all been realistic in recent times and CPD sought explanation from BBS on how GDP was being calculated.

This controversy surrounding GDP in Bangladesh had especially become acute during the previous decade in the wake of worsening democratic deficits in the country. For example, the growth in agriculture sector was negative and the remittances also decreased in 2015-16, but the growth rate was shown to be 7.11 per cent. The growth rate was again shown to be 7.28 per cent in 2016-17, but the remittances had decreased by over 14 per cent and the export growth was marginally above 1 per cent. The growth rate was then shown to be 7.86 per cent in 2017-18 following initial projection of 7.65 per cent despite negligible increases in productive capacity, investment and employment.

The GDP data claimed by BBS have not been realistic even in recent times, as evident from the provisional figures for 2019-20 that showed a growth of 5.24 per cent amid the Covid-19 pandemic. The whole country was under an informal lockdown (general holiday) from March 26 to May 29, and mostly the
garments factories were opened in the manufacturing sector in June. Besides, the hotels and restaurants, construction and transport sectors by and large remained closed during the March-June quarter. But instead of showing a negative growth, the manufacturing, construction, hotels & restaurants, and transport, storage & communication sectors (accounting for 44 per cent of GDP) were shown by BBS to have recorded growth rates of 5.48 per cent. 9.06 per cent per cent, 6.46 per cent and 6.19 per cent respectively. These figures also contradicted significant declines in two other indicators, viz. exports and revenue collection, which are usually positively correlated to GDP. Besides, BBS itself claimed that there had been 82 per cent fall in manufacturing output during April 2020, which was most likely to hold true for May as well because of the general holiday. Ultimately, BBS had to concede its lapses when the final GDP growth rate figure for 2019-20 was shown to be 3.51 per cent.

The country's leading economists have all along raised questions about the authenticity of GDP figures provisionally announced by BBS, even claiming that growth rate figures have now assumed the shape of a political number. A CPD executive director had commented in the past, "A kind of infatuation appears to have grown among the country's policy-makers regarding growth. Growth data are therefore being used politically. Exaggerating growth cannot be beneficial; it does not help policy-making". Even a former secretary of the statistics division claimed at a citizens' dialogue in 2019 that she had seen how development-related statistics were polished or doctored during her tenure. The problem becomes even more acute when an authoritarian regime tries to paint a rosy picture of the economy in an attempt to hide its democratic deficits.

It is sad that Bangladesh has not yet been able to develop a credible statistical system even after 50 years of existence. This lack of credibility of statistical methods needs to be addressed swiftly. There should be a transparent dialogue on the subject by involving all stakeholders, in addition to streamlining the statistical system. Otherwise, the real picture of the country's socio-economic growth can never
be gauged properly, which in turn proves to be a hindrance to adopting development policies and programmes and undertaking policy analysis in a realistic and logical manner.

Dr. Helal Uddin Ahmed is a retired Additional Secretary and former Editor of Bangladesh Quarterly. hahmed1960@gmail.com









----------------------------




Someone needs to learn how Purchasing Power Parity calculations work.
Dodgy data × PPP multiplier = credible data!!! Genius.

looks like that $2557 per capita figure after rebasing for the current FY is bogus when one looks at the latest IMF outlook. It more or less aligns with IMF's 2023 expected per capita income though. I think the number fudging was a way of diverting public opinion for the rise in poverty bought about by Covid, along with shaky initial handling of the vaccination program, among others

At the end of the day, when companies or funding bodies are looking to invest in Bangladesh, they'll use IMF figures rather than BBS.

 

[salute]

looks like that $2557 per capita figure after rebasing for the current FY is bogus when one looks at the latest IMF outlook. It more or less aligns with IMF's 2023 expected per capita income though. I think the number fudging was a way of diverting public opinion for the rise in poverty bought about by Covid, along with shaky initial handling of the vaccination program, among others

At the end of the day, when companies or funding bodies are looking to invest in Bangladesh, they'll use IMF figures rather than BBS.

I mean everyone outside the Bangladesh know the reality of that economy. Hence the FDI (real) hasn't crossed a $billion in recent years. Bangladesh FDI numbers include reinvested earnings of earlier investment. No matter what PDF Bangos want us believe real proof of pudding is in the investment and GOB revenue, not the made up BBS GDP figures.

 

[Destranator]

Puzzling low tax-GDP ratio

Sohel Parvez
Mon May 16, 2022 09:30 AM Last update on: Mon May 16, 2022 11:11 AM

While official data portrays the burgeoning growth of Bangladesh's economy, tax collection relative to the gross domestic product (GDP), a measure of the size of the economy, shows an almost opposite trend.
The tax collection as a percentage of GDP has been stuck at around 7.6 per cent, the lowest in South Asia and one of the lowest in the world. This prompts economists to question the disconnect since revenue receipts should increase in line with the expansion of the economy.

"This shows a big mismatch," said Selim Raihan, executive director of the South Asian Network on Economic Modeling.
"It shows that there is no relation between GDP growth and revenue collection although the tax-to-GDP ratio increases in other countries because of the growth of the economy. In the case of Bangladesh, it is a puzzle."


Over the past decade, the GDP grew 6.5 per cent annually, on average. The average annual growth of tax collection was 11 per cent.
As a result, Bangladesh continues to languish at the bottom among the South Asian countries when it comes to the tax-to-GDP ratio.
Among the least-developed countries set to graduate to the developing nations' category in the next four years, Bangladesh has the lowest tax collection as a percentage of GDP, data from the World Bank showed.

Bangladesh's tax-to-GDP ratio is also the lowest among the low-middle-income countries, and the ratio declined in the past decade, according to Raihan, also a professor of economics at the University of Dhaka.
"Does it mean that the additional GDP growth has remained out of the tax net? Does it mean that the economy has become more informal? Is it that tax avoidance is encouraged? It is a puzzle," he said.
The new value-added tax law, which came into effect several years ago, suffers from distortions while a large number of people are exempted from tax payments.
For example, the garment and textile sector, which provides guaranteed income, enjoys just half the corporate tax rate applied to non-listed companies.
Citing a previous study he co-authored, Prof Raihan says tax exemptions cost Bangladesh 2 per cent of its GDP.
"We have also had serious problems in the execution of laws. There are also a large number of people who don't want reforms. It seems that there is a nexus among a section of taxpayers and revenue officials against reforms."
However, this may not be the only case.
Economists are, in fact, doubtful about the GDP growth estimates in the first place, since the growth numbers do not commensurate with the real data such as revenue collection, debt, export-import, and credit growth.
"The growth that is shown does not relate with reality because an overstatement emerges if GDP is compared with other data," said Zahid Hussain, a former lead economist of the World Bank's Dhaka office.
Besides, the tax base is low compared to the size of the economy. Collection efficiency is also low. There are many loopholes in the tax policies, he added.
"As a result, small fishes escape the tax net, which is also not strong enough to catch big fishes."
In Bangladesh, there are plenty of tax benefits under various names: holidays, exemptions and waivers. So, Bangladesh loses a huge amount of tax because of the prevalence of tax breaks.
"The fact is money is really going out of taxpayers' pockets. But it is not going to the state coffer. The money is going to the pockets of various intermediaries [tax lawyers, dishonest revenue officials] in the system," Hussain said.
So, if the lost revenue is taken into account, the tax-to-GDP ratio would have increased.
"No country will be able to become an upper-middle-income country with such a low tax-to-GDP ratio," said Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh.
"The tax-GDP ratio should be 16-17 per cent."
He says the failure to increase tax collection is affecting the whole fiscal management.
People's out-of-pocket expenditure is increasing for a lack of public investment in the healthcare sector and many families go broke because of higher medical expenses. Similarly, Bangladesh cannot ensure quality education for inadequate investment.
"We have to borrow to build infrastructure and that loan is increasing at a higher rate," Mansur said. "There is no room for comfort if we can't invest from our own sources and have to run by borrowing."
At a programme in Dhaka on Saturday, Debapriya Bhattacharya, a distinguished fellow at the Centre for Policy Dialogue, said Bangladesh is a country of 16.50 crore people and 74 lakh people have tax identification numbers. Of them, only 23 lakh file income tax returns.

"Why hasn't the number of taxpayers gone up? If per capita GDP has increased, then why don't people pay taxes?" he questioned.

Mansur, also a former economist of the International Monetary Fund, suggests reforming the tax system.

"It appears that political will for reforms is low. But without increasing revenue collection, it is not possible to fulfil the expectations of the people and the government. Politicians have to realise this."

Increased revenue collection is also needed to become a developed nation.

"Our economic growth will slow if we can't invest in physical and social infrastructures. Income distribution will be more skewed if we can't boost tax collection as tax policy is a tool for ensuring better income distribution," added Mansur.

https://www.thedailystar.net/business/economy/news/puzzling-low-tax-gdp-ratio-3024491

 

[rainbowrascal]

The National Board of Revenue (NBR) wants to reduce tax exemptions significantly for various projects in public and private sectors.

Instead, the revenue board has requested all ministries and divisions to take extra allocations from the finance ministry to pay tax, VAT and duty. To this end, the NBR on Thursday sent a letter to 281 organisations, including ministries, divisions and autonomous firms.

According to the letter, tax exemption on various development projects is a major obstacle to increasing the tax-to-GDP ratio.

The NBR hopes that the country's tax-to-GDP ratio will be doubled if such taxes are levied instead of exemptions.

According to the NBR, the tax exemptions given in various sectors every year amount to around Tk250,000 crore.


"It [the letter] is a clear message from the NBR that it will not offer tax exemptions in the future," says a NBR official seeking anonymity.

Agreeing with the NBR's move, Dr Debapriya Bhattacharya, an economist and public policy analyst, told The Business Standard that in the interest of tax collection, financial transparency and reduction of inter-sectoral inequalities, the wholesale tax exemptions should be abolished.

After paying the tax money to the government coffers, if necessary, they can have additional funds allocated by showing it as expenditure, he noted.

The economist thinks that other projects and many groups are taking advantage of the facility.

Such tax benefits should be given to those in special needs, Dr Debapriya said.

The finance minister is also not in favour of such exemptions. In his budget speech for FY20, he said tax exemptions in various sectors would be avoided as much as possible. "We will refrain from issuing SRO [Statutory Regulatory Order] until it is an emergency, which will bring transparency in revenue management. The confidence of businesspeople in the government will also go up," he added.

NBR Chairman Abu Hena Md Rahmatul Muneem in different discussions also expressed his position against the wholesale tax exemptions.

The NBR conducted an internal study on exemptions during the preparation of the budget for the fiscal 2020-21.

The NBR estimated that the tax-GDP ratio was 9.9% in FY20, but it would have been 17.81% had the government not provided tax exemptions

It said the government provided tax exemptions amounting to around Tk2.5 lakh crore to facilitate growth in different sectors in FY20. It realised Tk2.18 lakh crore in revenue that year against a target of Tk3 lakh crore.

Of the total exemptions, Tk46,755 crore was exempted for importing raw materials, capital machinery, and other goods, while Tk1,51,738 crore was waived against bond facilities for export-oriented industries.

NBR wants to come out of tax exemptions

The National Board of Revenue (NBR) wants to reduce tax exemptions significantly for various projects in public and private sectors. Instead, the revenue board has requested all ministries and divisions to take extra allocations from the finance ministry to pay tax, VAT and duty.

www.tbsnews.net

 

[Destranator]

Unmeaning per capita income increase, GDP growth​

Published: 00:00, May 12,2022

AN INCREASE in the per capita income to $2,824 in the outgoing 2022 financial year from $2,591 the financial year before, an estimate that the government has done but experts have doubted, appears not to have any reflection on living standards of citizens. A growing number of poor people, with 32.4 million surveyed by the Power and Participation Research Centre and the BRAC Institute of Governance and Development in November 2021 to have freshly slid below the poverty threshold during the still ongoing protracted Covid outbreak, and a widening income inequality make the proposition meaningless. The planning minister who made the per capita income disclosure at a briefing at the Planning Commission, however, failed to give any figure for the current number of poor people and noted that it is for the Bangladesh Bureau of Statistics to calculate. The per capita income, which is the national income divided by the population size, appears not to have added to the standards of living as the economic benefits that are created in the economy do not reach people of all strata commensurately. In addition, experts have also doubted the figure of the gross domestic product, which is used along with the population estimate to calculate the per capita income.

The provisional estimate of the national statistical office, as the minister said, has put the growth of the gross domestic product at 7.25 per cent for the outgoing financial year while the gross domestic product grew by 6.94 per cent in the 2021 financial year. The official provisional estimates put the growth of the agriculture sector at 2.20 per cent
for the outgoing financial against the figure of 3.7 per cent the financial year before. The growth of the manufacturing sector has been put at 10.44 per cent against the figure of 10.29 per cent for the 2021 financial year and the growth of the services sector at 6.31 per cent against the figure of 5.73 per cent for the 2021 financial year. A former World Bank Dhaka office chief economist seeks to say that an estimated 7.2 per cent growth of the gross domestic product is not convincing and a double-digit growth of the manufacturing sector amidst a negative growth in mining and quarrying is doubtful. A macroeconomist and public policy analyst also seeks to doubt the 11.71 per cent growth of the cottage, medium, small and micro enterprises as being high. The minister said that the income of both the poor and the rich increased despite a growing inequality, but the National Human Development Report 2021, which the Economic Relations Division released in January 2022, shows that the richest 5 per cent held about 30 per cent of the national income in 2016 while the share of the poor in the national income remained less than 0.3 per cent.
While there is nothing to boast of an increase in per capita income, which presents a mean value of the national income and not the picture of income distribution, and the growth of the gross domestic product, which fails to create economic benefits for all, the government must set issues of the calculation of the per capita income and the gross domestic product in a credible and meaningful manner.

Unmeaning per capita income increase, GDP growth

AN INCREASE in the per capita income to $2,824 in the outgoing 2022 financial year from $2,591 the financial year before, an estimate that the government has done but experts have doubted, appears not to have any reflection on living...

www.newagebd.net

 

[Khan_21]

Unmeaning per capita income increase, GDP growth​

Published: 00:00, May 12,2022

AN INCREASE in the per capita income to $2,824 in the outgoing 2022 financial year from $2,591 the financial year before, an estimate that the government has done but experts have doubted, appears not to have any reflection on living standards of citizens. A growing number of poor people, with 32.4 million surveyed by the Power and Participation Research Centre and the BRAC Institute of Governance and Development in November 2021 to have freshly slid below the poverty threshold during the still ongoing protracted Covid outbreak, and a widening income inequality make the proposition meaningless. The planning minister who made the per capita income disclosure at a briefing at the Planning Commission, however, failed to give any figure for the current number of poor people and noted that it is for the Bangladesh Bureau of Statistics to calculate. The per capita income, which is the national income divided by the population size, appears not to have added to the standards of living as the economic benefits that are created in the economy do not reach people of all strata commensurately. In addition, experts have also doubted the figure of the gross domestic product, which is used along with the population estimate to calculate the per capita income.

The provisional estimate of the national statistical office, as the minister said, has put the growth of the gross domestic product at 7.25 per cent for the outgoing financial year while the gross domestic product grew by 6.94 per cent in the 2021 financial year. The official provisional estimates put the growth of the agriculture sector at 2.20 per cent
for the outgoing financial against the figure of 3.7 per cent the financial year before. The growth of the manufacturing sector has been put at 10.44 per cent against the figure of 10.29 per cent for the 2021 financial year and the growth of the services sector at 6.31 per cent against the figure of 5.73 per cent for the 2021 financial year. A former World Bank Dhaka office chief economist seeks to say that an estimated 7.2 per cent growth of the gross domestic product is not convincing and a double-digit growth of the manufacturing sector amidst a negative growth in mining and quarrying is doubtful. A macroeconomist and public policy analyst also seeks to doubt the 11.71 per cent growth of the cottage, medium, small and micro enterprises as being high. The minister said that the income of both the poor and the rich increased despite a growing inequality, but the National Human Development Report 2021, which the Economic Relations Division released in January 2022, shows that the richest 5 per cent held about 30 per cent of the national income in 2016 while the share of the poor in the national income remained less than 0.3 per cent.
While there is nothing to boast of an increase in per capita income, which presents a mean value of the national income and not the picture of income distribution, and the growth of the gross domestic product, which fails to create economic benefits for all, the government must set issues of the calculation of the per capita income and the gross domestic product in a credible and meaningful manner.

Unmeaning per capita income increase, GDP growth

AN INCREASE in the per capita income to $2,824 in the outgoing 2022 financial year from $2,591 the financial year before, an estimate that the government has done but experts have doubted, appears not to have any reflection on living...

www.newagebd.net

This has been going on for a long time now. There are so many articles accusing them of data fudging to make themselves look good. Who keeps on doing press conferences every month to give an updated per capita income?

Posters like @UKBengali @Black_cats @BananaRepublicUK have convinced themselves otherwise. Dhaka looks like an African city but the way they keep spinning these figures it will soon surpass Dubai on datasheets.

 

[Destranator]

This has been going on for a long time now. There are so many articles accusing them of data fudging to make themselves look good. Who keeps on doing press conferences every month to give an updated per capita income?

Posters like @UKBengali @Black_cats @BananaRepublicUK have convinced themselves otherwise. Dhaka looks like an African city but the way they keep spinning these figures it will soon surpass Dubai on datasheets.

Dhaka is an unplanned concrete jungle which is over populated beyond repair so it is unfair to judge Bangladesh's economic growth by what Dhaka looks like.
Besides, Bangladesh rarely takes out loans for cosmetic projects. Whatever Dhaka has is mostly locally funded.

Bangladesh is growing fast - anyone who travels around the country can tell by the improving rural infrastructure (roads, electricity distribution, etc.) , increased mechanisation of farming, new factories, mushrooming high end eateries and shopping centres, etc..

The issue here is accruacy of BBS data.