Questionable BBS GDP Statistics

[Destranator]

Bangladesh Bureau of Statistics (BBS) is the main economic statistics agency of Bangladesh responsible for collecting necessary economic data to calculate the GDP.

Due to the sheer amount of data collection and calculations involved in coming up with GDP figures, multinational agencies such as IMF, World Bank, CIA and ADB are forced to rely on BBS statistics as the basis of their own forecasts despite raising concerns on the validity of BBS statistics on many occasions. The inclusion of BBS-derived data into the comparision tables of these multinational agencies often creates the false impression among less informed Bangladeshis that these figures are verified and validated by them which could not be further from the truth.

It has become quite fashionable for some people to throw around GDP stats to brag about Bangladesh's economic development and belittle other countries. While there is no doubt about the significant economic strides Bangladesh has made since 1990 and particularly in the last 10 years, there remain credible concerns regarding tampering by BBS to inflate GDP stats for political purposes.

The purpose of this thread is for readers to keep informed of the concerns raised by experts over the years in order to be able to form informed opinions about Bangladesh's GDP figures.
Historical articles will be posted.


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GDP decided first, calculations done later
By Riti Ibrahim

The Bangladesh Bureau of Statistics (BBS) has provisionally calculated the growth of 5.24 per cent for the gross domestic product (GDP) in the last 2019-20 fiscal year. Economists and private research organisations claim that this growth calculation does not match reality. Questions have also been raised about the competence of BBS. There have also been allegations of political interference in modifying and fabricating data and information generated by BBS. Riti Ibrahim, former secretary of the statistics and information management department of the planning ministry, spoke on the issue. Jahangir Shah transcribed her deliberation.
The Bangladesh Bureau of Statistics (BBS) has given a provisional account of the gross domestic product (GDP) of the previous financial year. This calculation has been made on the basis of information received till 31 March (first nine months of the financial year). Presumably, this provisional estimate was drawn up by BBS in the normal process just as in any other year.
The last three months of the financial year (April-June) remained static due to the coronavirus outbreak in the country. Remittance may have increased. But there is cause to be concerned as many have lost their jobs, many have been sent back to the country. In this situation, the GDP growth will not be as much as shown in the BBS provisional calculation for the whole financial year. This can be termed as an inflated estimate.

BBS has its weaknesses. There are very few people who have degrees in statistics. The major setback is that there are no statisticians of that quality who will guide BBS.

I saw at the beginning of my career that it is decided beforehand of how much GDP growth will be announced to the public. Later this was somehow fixed by calculating backwards.
However, the few years that I was in charge, I did not allow this to happen. Especially during the census, I instructed that no eraser can be used. The first data found in the field level should be the final data. I do not understand why so much influence is exerted on GDP? GDP is not everything. Development in social sectors such as women's empowerment, health must also be taken into consideration.

New officers were appointed to BBS. Most of them are non-professionals. I believe initiatives need to be taken to strengthen BBS.

BBS has its weaknesses. There are very few people who have degrees in statistics. The major setback is that there are no statisticians of that quality who will guide BBS. The consultants are all administration cadre officers. So there is considerable weakness at the advisory level. There is also a weakness in the method of collecting information in the field. Nobody seems to care about BBS data.
The Department of Statistics and Information Management was formed to advise the BBS. It was well planned, but it was not enough. Those who have worked at BBS for a long time know a lot about statistics. They were once transferred to the Department of Statistics and Information Management. New officers were appointed to BBS. Most of them are non-professionals. I believe initiatives need to be taken to strengthen BBS.
*This analysis, originally published in Prothom Alo print edition, has been rewritten in English by Farjana Liaka

GDP decided first, calculations done later

Questions have been raised about the competence of BBS. There have also been allegations of political interference in modifying and fabricating data and information generated by BBS

en.prothomalo.com

 

[fallstuff]

She should include instances were datas were cooked otherwise its just not credible.

 

[Destranator]

She should include instances were datas were cooked otherwise its just not credible.

A former secretary of Dept of Statistics and Information Management is as credible as it gets. She is risking losing her pension, gratuity and physical wellbeing by writing this.

BBS does not publish full data and calculations on purpose despite repeated requests as it would reveal exact instances of foul play.


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World Bank casts doubt on Bangladesh's GDP growth forecast
Staff Correspondent, bdnews24.com
Published: 2018-04-09 19:32:51 BdST

The World Bank has its doubt about the Bangladesh government’s 7.65 percent economic growth projection for the ongoing fiscal year.

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“Remittance inflows have recovered somewhat. But, it remains lower than expected,” said Washington-based global lender's lead economist in Dhaka, Zahid Hussain. "So, where is the source of growth?” he asked.
In sharp contrast to the government’s growth estimate, Zahid said, “Private investment did not pick up the pace of what is required to attain the government’s projection.”
Presenting Bangladesh Development Update report on Monday, he said the BBS data shows the manufacturing sector grew 13.2 percent in last fiscal year over the previous fiscal, but only 200,000 jobs were generated, and private investment remained stagnant during the period.
“How does manufacturing industry expand so fast? This is the question.”
The lender slightly raised its forecast for Bangladesh’s economic growth in the fiscal 2017-18 to 6.5 to 6.6 percent from 6.4 percent it projected in January, according to the latest report.
The World Bank's report comes a week after national statistical agency BBS published data on the sector-wise contribution to the GDP in fiscal 2017-18.
According to the data, the domestic demand grew 7.65 percent on the back of manufacturing and construction sectors.
"Higher domestic demand is the driving force of manufacturing growth, but we do not see any spike in domestic demand as growth in the employment, labour income or remittances remained subdued," said Zahid Hussain.

World Bank casts doubt on Bangladesh's GDP growth forecast

The World Bank has its doubt about the Bangladesh government’s 7.65 percent economic growth projection for the ongoing fiscal year.

m.bdnews24.com

​

 

[fallstuff]

A former secretary of Dept of Statistics and Information Management is as credible as it gets. She is risking losing her pension, gratuity and physical wellbeing by writing this.

BBS does not publish full data and calculations on purpose despite repeated requests as it would reveal exact instances of foul play.

Whistleblowers need to show the evidence, as Chris Hemsworth said , " প্রমাণ দাও "

 

[Destranator]

Whistleblowers need to show the the evidence, as Chris Hemsworth said , " প্রমাণ দাও "

Well if we make up our mind to blindly drink govt koolaid and believe whatever Kamal chora throws at us, ignoring experts then there is no hope. You should be asking why BBS hides their field data for each sector.

 

[Destranator]

WB questions government data about GDP growth
FE Online Report | Published: April 09, 2018 18:29:15 | Updated: April 11, 2018 18:44:02

The World Bank (WB) on Monday has expressed doubts about the Bangladesh’s 7.65 per cent GDP growth projection for the current fiscal raising questions regarding some government data.
The Washington-based lender also said the GDP growth is expected to be within the range of 6.5 to 6.6 per cent in the medium term of the current fiscal.
“The robust growth for the current fiscal is doubtful as its correlation with some government statistics is not matched,” said WB Lead Economist Dr Zahid Hussain during a presentation of the Bangladesh Development Update Dhaka.
Hussain raised questions about the government data of the higher manufacturing growth, lower service sector growth compared to its higher job creation, production capacity of the industrial sector, stagnant investment, labour income growth and remittance growth, volatile food and non-food inflation data.
The Bangladesh Bureau of Statistics has recently revealed that Bangladesh’s Gross Domestic Product (GDP) is expected to grow at 7.65 per cent in FY18, which is even higher than its target of 7.5 per cent.
“How this higher growth is furnished with this production capacity in the industrial sector we are noticing over the years? It is only be possible when the production capacity will picked up. But question is --how the capacity has climbed within a year?” Dr Hussain questioned.
He said the manufacturing sector has been estimated to grow faster this year than last year although the private sector investment is observed almost stagnant over the years.
The Lead Economists said the growth is shown mainly based on the expansion of the consumer’s demand or consumption which is not in sync with government’s relevant data.
“But we do not see any leap in any of the cases. The growth of employment was at 2.2 per cent while the labour income was at 2.7 per cent in 2017,” he added.
“Remittance inflows have recovered. Yet, the level of remittance still remains 2.7 per cent less than in July-march of fiscal year 2015-16,” he said.
He asked an explanation or clarification on the government data of projected growth for FY18.
WB Country Director Qimiao Fan was present among others at the function in Dhaka.

kabirhumayan10@gmail.com

WB questions government data about GDP growth

The World Bank (WB) on Monday has expressed doubts about the Bangladesh’s 7.65 per cent GDP growth projection for the current fiscal raising questions regarding some government data. The Washington-based lender also said the GDP growth is expected to be within the range of 6.5 to 6.6 per cen

thefinancialexpress.com.bd

 

[fallstuff]

Well if we make up our mind to blindly drink govt koolaid and believe whatever Kamal chora throws at us, ignoring experts then there is no hope. You should be asking why BBS hides their field data for each sector.

I agree Govt #s should not be taken without a grain of salt, and in the same token one should also consider the ulterior motives of a whistleblower. They need to show which numbers were fudged.
Well she needs to say a certain number is not so for XYZ reasons.

She herself could be compromised in some way !

 

[Destranator]

Fiscal 2019-20’s GDP figure stretches credulity
States CPD pointing out BBS attempt at painting a rosy picture

Star Business Report
The Centre for Policy Dialogue (CPD) yesterday raised questions over the economic growth figure of 5.24 per cent estimated by the Bangladesh Bureau of Statistics (BBS) in the just-concluded fiscal year.
The obvious repercussions of the pandemic on the economy were not adequately reflected in the provisional GDP growth estimate, released by the statistical agency last week, said the independent think-tank.
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Questions arise regarding the accuracy as all the major indicators, except for remittance, had been in the negative, said CPD Executive Director Fahmida Khatun at a virtual press briefing.
Economic growth figures are used as a tool to gain leverage in politics, she said.
"An infatuation with growth has been created," she said, adding that the GDP growth has become "a political number" and the growth data being portrayed as a sign of the government's successes.
But GDP growth does not turn meaningful until it is inclusive and the benefits of growth are distributed among all, she said, citing unemployment, rising inequality and the sluggish pace of poverty reduction in the country in recent years.
In its review of BBS's data for fiscal 2019-20, CPD said private sector credit growth had been the lowest in a decade.
Industrial production, export-import of capital machinery, foreign direct investment and revenue collection also declined last fiscal year, resulting from a downturn in the global and domestic economy for the outbreak of the respiratory virus, it said.
"The effect of the Covid-19 is historic on economies including Bangladesh. The effects are unprecedented," Khatun said.
But this was not shown on the GDP growth data, she added.
CPD shared its view less than a week after the state-run BBS said the Bangladesh economy grew at the "respectable rate" they had calculated -- all the while large swathes of the global economy plunged into recession for the outbreak of coronavirus from Wuhan, China.
The BBS estimate beat forecasts by Washington-based multilateral lenders World Bank and International Monetary Fund that the economy would grow between 1.6 per cent and 3.8 per cent in fiscal 2019-20 for the pandemic-whiplash.
The Asian Development Bank said the Bangladesh economy would expand at 4.5 per cent while CPD projected that the GDP growth would be no more than 2.5 per cent.
In its briefing, the organisation did not revise its previous forecast; rather, it stated that the economy grew close to its previous projection of about 2.5 per cent in fiscal 2019-20.
All economic activities, from manufacturing, construction, hotels and restaurants, transport, storage and communication, community, social and personal services sectors, were hit the hardest during the coronavirus-induced shutdown for almost two months, CPD said.
The provisional GDP estimates could not capture the significant adverse impacts of the Covid-19 pandemic, said CPD Senior Research Fellow Towfiqul Islam Khan, presenting a paper at the event.
Many lost jobs while the income of a large section dropped.
"Indeed, more than half of the provisional GDP estimates are not based on credible real-time data," he said, adding that overall growth of the economy would drop from the provisional estimate if updated data were used to do the calculations.
CPD cited data on the rise of private investment used by BBS in the GDP estimate, stating that the rise was indeed unexpected when the entrepreneurs have been struggling to keep their existing production capacity fully operational.
BBS estimated that public investment as a share of GDP also increased in fiscal 2019-20. Overall, investment as a share of GDP increased to 31.75 per cent in fiscal 2019-20 from 31.57 per cent the previous year, CPD said citing the data from the state-run statistical agency.
The GDP growth estimate did not reflect the reality as proxy indicators told a different story, said CPD Distinguished Fellow Mustafizur Rahman.
If the estimations are correct, the nominal GDP growth rate should be about 11 per cent in fiscal 2019-20, he said.
Then the question arises on why the revenue collection performance is such, he said citing declining receipts.
The economy did not grow in the fourth quarter of the year owing to the countrywide general shutdown. The growth was negative.
"We think that the assumption that we made, projecting a 2.5 per cent growth of the economy, is correct."
A wrong signal would go to the policymaking level unless the estimates were carried out properly. And this will not help in the framing of proper policies, Rahman added.
The shutdown affected the services sector, said CPD Research Director Khondaker Golam Moazzem.
The government expanded social safety nets and announced more than Tk 100,000 crore as a stimulus to reinvigorate the economy from the wreckage of the global pandemic.
If the economy grew at this pace, there would have been no need for the measures to revive the economy, he said.
CPD demanded public release of the background data used in calculating the national income to clear the ambiguities and questions regarding the estimation process.
It also urged the government to let the statistical agency to enjoy more independence and form an independent commission to ensure reliability and integrity of data.
As the growth data has become a political number, the independence of people engaged in data collection has been affected, Khatun said.
Moazzem pointed out that South Africa had an independent statistical commission.
Rahman said the government should ensure the integrity of data for its enlightened self-interest.

Fiscal 2019-20’s GDP figure stretches credulity

The Centre for Policy Dialogue (CPD) yesterday raised questions over the economic growth figure of 5.24 per cent estimated by the Bangladesh Bureau of Statistics (BBS) in the just-concluded fiscal year.

www.thedailystar.net

 

[Destranator]

Anyone who travels around Bangladesh can tell the significant economic development that has taken place in the last 10 years. The question here is not whether Bangladesh is developing, the question is how accurate the GDP stats are.


GDP growth doubted, quality questioned
Jasim Uddin | Published: 00:23, Jun 10,2019 | Updated: 00:53, Jun 10,2019


Bangladesh has become one of the fastest growing economies in the world with a record 8.13 per cent gross domestic product growth in the outgoing financial year 2018-19 raising doubt and questions among experts, economists and research bodies.
Over the past decade Bangladesh has registered one of the fastest economic growth rates in the world but experts and economists continue to doubt the figures and sources of growth questioning the authenticity of the government estimation.
Experts and research organisations said that Bangladesh economy was expected to grow at a higher rate but not so high as the government estimated as the primary economic growth drivers and other indicators did not match the estimated rate.
They said that the quality of GDP growth also remained a big concern as poverty reduction and job creation rates were not aligned with the growth rate while inequality kept rising.
Centre for Policy Dialogue on April 23 in a report on the first 100 days of the government doubted the government’s provisional estimate of 8.13 per cent GDP growth for FY19, citing mismatch between the projected growth rate and various economic performance indicators.
The think tank distinguished fellow Debapriya Bhattacharya said that the government-estimated GDP growth was not reflected in various economic indicators, including private investment, private-sector credit growth, capital machinery import, revenue collection and employment generation.
The overall productivity also did not increase while income inequality widened, he said.
The report said that some manufacturing sectors like leather and related products registered very high growth without a commensurate reflection in the export performance.
The tax to GDP ratio and private sector credit also registered lower growth in FY19 compared with FY18, it added.
The GDP deflator growth (4.23 per cent) was also estimated significantly lower than the inflation rate (5.48 per cent as of March 2019), it said.
The think tank analysis showed that the economy was going through a jobless growth phase as the employment rate decreased by 0.95 percentage points in 2010-2017 compared to 2000-2010.
It demanded disclosure of all data based on which the growth was estimated for the sake of transparency of the estimation.
Policy Research Institute executive director Ahsan H Mansur told New Age on Sunday that the country’s economy was growing at a better rate but the rate estimated by the government created questions and doubt as many economic indicators did not match the rate.
Growth in revenue generation was very slow (7.27 per cent in the first nine months of FY19) though it should have been much higher in line with the higher GDP growth and manufacturing growth of 19.50 per cent, he said.
Credit flow in banking sector declined to 12 per cent and businesses were not getting loan due to liquidity crisis, he mentioned.
The rate of bankruptcy also kept rising and employment generation was not increasing at an expected rate, he said.
In this context, the question is what the sources of growth are, he said.
The government should be restraint about GDP growth rate in coming years and GDP growth should be well matched with economic reality, he said, adding that the GDP was not out of overall economic performance rather it was a combined outcome of overall economy.
South Asian Network on Economic Modelling on May 9 in its quarterly review of Bangladesh economy termed the rising economic growth as conundrum and inconsistent with various indicators and the drivers of growth.
Export and remittance are two major drivers of Bangladesh economy but high economic growth in recent years does not match sluggish growth in export and remittance, it said.
The estimated high growth in private consumption also does not match low export and remittance growth.
High manufacturing growth does not match low export growth and slow private investment, it said.
The think tank, however, said that the quality of growth was a big concern.
‘Poverty rate has declined in the country but the growth elasticity of poverty has declined too. That means, the pace of poverty reduction is much slower than the pace of GDP growth rate,’ it said.
Inequality is also rising despite higher growth while employment generation also becomes slower, it added.
The obsession with the GDP growth numbers puts policymakers in the comfort zone and reform-averse, it said.
Its executive director Selim Raihan said that policymakers should focus on whether the growth could remove poverty and inequality, and create enough employment instead of growth numbers.
He said that private consumption grew at an unusual pace despite low growth in export and remittance inflows.
Private investment is also falling in real terms, he said.

GDP growth doubted, quality questioned

Bangladesh has become one of the fastest growing economies in the world with a record 8.13 per cent gross domestic product growth in the outgoing...

www.newagebd.net

I agree Govt #s should not be taken without a grain of salt, and in the same token one should also consider the ulterior motives of a whistleblower. They need to show which numbers were fudged.
Well she needs to say a certain number is not so for XYZ reasons.

She herself could be compromised in some way !

One expert could be compromised, not mutiple credible experts working for various credible agencies. Stay tuned.

 

[Destranator]

SANEM questions Bangladesh GDP growth forecast for fiscal 2018-19
2019-05-10 00:24:38
Senior Correspondent, bdnews24.com

South Asian Network on Economic Modeling or SANEM, a non-profit research organisation, has questioned the current fiscal year’s 8.13 percent economic growth projection.
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Terming the recent economic growth of Bangladesh ‘puzzling’, it said the GDP growth mismatched the statistics and indicators of the country’s economic driving forces.
Earlier, the Centre for Policy Dialogue or CPD, an independent think tank, had also questioned the current year's growth estimate citing inconsistencies in many economic indicators.
The Bangladesh Bureau of Statistics, or BBS, the national statistical agency, projected that the economic growth would hit 8.13 percent for the first time in the history of Bangladesh in the fiscal year that will end on June 30.
The World Bank predicted Bangladesh’s economy will grow at 7.3 percent in the fiscal year, lower than the government projection. The Asian Development Bank predicted 8 percent.

“It is said that the increased internal demand rather than exports, remittances and foreign investments brings impetus to the economic growth in Bangladesh. But domestic demand alone cannot bring such an explosive growth in a low-income country like Bangladesh," said SANEM Executive Director Selim Raihan in Dhaka on Thursday.

Referring to the Chinese economic growth, he said its growth rate has slowed down in recent years. One of the major reasons for this is that they adopted the policy of raising domestic consumption.
“So how do we explain this upward GDP growth? From academic and professional point of view, we are struggling to explain this growth," said Raihan, also a professor of economics at Dhaka University.
Highlighting BBS statistics, he said private consumption growth was estimated at 3 percent in 2015-16, 7.43 percent in 2016-17 and 11.02 percent in 2017-18.
“The private consumption growth rate is unusual and puzzling,” he said.
He also expressed his doubt about the high manufacturing growth rate at 13.4 percent in fiscal 2017-18, although export growth was 5.81 percent during the same period when the private investment growth also remained slow.
“The manufacturing growth statistic does not match the poor business environment,” he said.
SANEM wondered how a country can achieve higher economic growth despite low growths in exports and private investment in the current fiscal year.
In 2018, Bangladesh also slipped in ranking in World Bank’s Doing Business and Logistics Performance Index, according to it.

SANEM questions Bangladesh GDP growth forecast for fiscal 2018-19

South Asian Network on Economic Modeling or SANEM, a non-profit research organisation, has questioned the current fiscal year’s 8.13 percent economic growth projection.

bdnews24.com

Bangladesh's GDP grew by record 7.86pc in FY18, experts doubt
Staff Correspondent | Published: 00:05, Sep 19,2018 | Updated: 12:58, Sep 19,2018

Bangladesh’s gross domestic product growth hit record 7.86 per cent, beating the provisional estimation by 0.21 percentage points, in the past fiscal year of 2017-2018, according to the final calculation done by Bangladesh Bureau of Statistics.
BBS in its provisional estimate in April said that economic growth of the country would be 7.65 per cent in FY18 against the government’s target of 7.4 per cent for the fiscal year.
Experts and economists, however, expressed scepticism about the higher economic growth calculated by BBS for the fiscal year, saying that the growth was not consistent with the performance of other economic indicators.
Growth in private sector investment, private sector credit flow, exports and job creation was not high enough to support 7.86 per cent growth in the year, they said.
Planning minister AHM Mustafa Kamal on Tuesday disclosed the revised GDP calculation at a press briefing after the weekly executive committee of the National Economic Council meeting held at the NEC auditorium in Dhaka. The final calculation of the GDP growth was placed before the ECNEC meeting which was presided over by prime minister Sheikh Hasina.
Kamal claimed that GDP growth went up in the final calculation on higher-than-estimated contribution of industry and services sectors.
GDP growth also maintained upward trend as there was no major natural calamities in the country in the period, he said.
GDP growth was 7.28 per cent in the previous fiscal year (FY 2016-2017).
Former interim government adviser Mirza Azizul Islam told New Age that the country could not obtain higher economic growth with the present rate of investment that was hovering at around 31 per cent of GDP.
He said that many economic indicators including private sector investment, private sector credit growth, export growth and some other indicators were not supportive of the calculated growth.
According to BBS, all the three sectors — agriculture, industry and services — grew faster than the provisional estimation.
Agricultural sector finally grew by 4.19 per cent while industry grew by 12.06 per cent and services by 6.39 per cent.
BBS’s initial growth projection was 3.06 per cent, 11.99 per cent and 6.33 per cent for agriculture, industry and services respectively.
The contribution of agriculture, industry and services sectors stood at 13.82 per cent, 30.17 per cent and 56 per cent respectively in the year.
Both service sector growth rate and contribution to GDP declined in the year, which were 6.69 per cent and 56.50 per cent respectively in FY17.
The share of investment as percentage of GDP, however, revised downward to 31.23 per cent in the final calculation from that of 31.47 per cent estimated initially mainly because of lower public investment.
Private investment ratio to GDP reached 23.26 per cent from 23.25 per cent while public investment was downsized to 7.97 per cent from initial 8.22 per cent, according to the BBS data.
The new per capita income reached $1,751 or Tk 1,43,789 in the year, one dollar less than the provisional estimation. The figure was $ 1,610 in FY17.
The size of the country’s GDP stood at $274.11 billion in the year.
BBS also said that the rate of poverty declined to 21.8 per cent in 2018 in the country from 23.1 per cent in 2017.
On the other hand, extreme poverty rate also dropped to 11.3 per cent in 2018 from 12.1 per cent a year ago.
National savings ratio to GDP was 27.42 per cent in FY18, the data showed.
Former Bangladesh Bank governor Salehuddin Ahmed said that there was no doubt about higher economic growth in the country in the year but 7.86 per cent was difficult as private investment grew marginally, export growth was paltry and private sector credit flow declined in the year.
Though overall investment somewhat increased, it might not transform into an increase in production and productive capacity, he said.
He also expressed disappointment over distribution of economic growth as mass people were not getting the benefits of the growth.
Growth rate is just a number and it is nothing about ensuring equity, equal distribution of benefits of development and remove income inequality, he said.
‘So, it will not be wise to put unconditional belief on growth rate,’ he added.

Bangladesh's GDP grew by record 7.86pc in FY18, experts doubt

Bangladesh’s gross domestic product growth hit record 7.86 per cent, beating the provisional estimation by 0.21 percentage points, in the past fiscal year of 2017-2018, according to the final calculation done by Bangladesh Bureau of Statistics....

www.newagebd.net

 

[Destranator]

Estimation of GDP in Bangladesh needs a reform
FE Team | Published: August 17, 2020 21:31:48 | Updated: August 19, 2020 21:53:24

Estimation of GDP in Bangladesh needs a reform

Over the past decade, growth rate of the Gross Domestic Product (GDP) has been at the centre of attention of economic policy discourse in Bangladesh. However, Centre for Policy Dialogue (CPD) has also been emphasising that qualitative and distributive aspects of GDP growth are no less important than mere growth figures. In view of the Covid-19 pandemic, the importance of credible estimates of GDP has assumed heightened importance as it has significant implications for economic policymaking at a crucial time. The estimates of GDP have been under scrutiny for past several years due to its apparent disjuncture with several other key macroeconomic and development correlates including private sector credit, revenue mobilisation, import payments for capital machineries, energy consumption, export receipts, employment generation etc. The recent release of GDP estimates for FY20 has sparked another fresh round of discussions and debates.
THE EARLY PROJECTIONS AND GROWTH DEBATE: In view of the ramification of the pandemic for the Bangladesh economy in FY20, there was a general consensus among experts and practitioners that the GDP growth rate will be significantly lower than the planned target of 8.20 per cent. The Ministry of Finance (MoF) prediction of 5.20 per cent was an outlier when compared to other independent estimates - CPD had earlier estimated that GDP growth in FY20 will not be more than 2.50 per cent. The World Bank in April this year projected that GDP growth would range 2.0 per cent to 3.0 per cent, while IMF projected 3.80 per cent in June this year. Surprisingly, the provisional estimates of GDP growth (5.24 per cent) has turned out to be very close to MoF prediction of 5.20 per cent presented at the budget time! There is no doubt that all economic activities of the country were affected prominently during the almost two-month long 'general holiday period', at varying degrees concerning all sectors of the economy. CPD, while estimating its growth projection, identified five sectors which were hit hardest. These are: manufacturing; construction; hotels and restaurants; transport, storage and communication; and community, social and personal services. The anecdotal information and trends observed since the outbreak of the pandemic would also confirm this.
IS BANGLADESH AN OUTLIER?: Comparing official GDP growth rate figures across countries remains a difficult task for several reasons. The fiscal year is often different for different country. Impact of the Covid-19 pandemic on the economy was felt at somewhat different times in different countries. The pre-conditions (in terms of economic performance) varied across countries. However, almost all countries have experienced deceleration, in varying degrees, in terms of growth performance. For many countries, GDP has indeed shrunk (e.g. UK, USA, Singapore etc.). Pakistan in FY2020 (July-June) is likely to register (-) 0.40 per cent GDP growth. The economy of Vietnam during Jan-Jun of 2020 was able to grow by only 1.81 per cent. India has not released its Apr-Jun quarter GDP estimates yet, but a significant contraction is apprehended. In view of the above, even if the Bangladesh economy could grow by 2.50 per cent in FY20 (as projected by CPD), it is likely to be one of the fastest growing economies in the world.
A DEEP DIVE INTO THE BBS PROVISIONAL ESTIMATES: Let us recall the preamble of GDP estimates by the Bangladesh Bureau of Statistics (BBS). The provisional estimates of GDP (national accounts) are usually released in May of a fiscal year. At the time of these estimates, at best eight to nine months' data are available. BBS did not prepare the estimates in May this year when the country was under the 'general holiday' in view of the pandemic. On August 10, 2020, the BBS released the provisional estimates on its website. According to follow-up news reports, the BBS has considered data for about nine months (July 2019-March 2020). This implies that the provisional GDP estimates could not capture the significant adverse impacts of the Covid-19 pandemic.

Nevertheless, 5.24 per cent GDP growth in FY20, as estimated by the BBS, is the lowest in last decade. On the other hand, in view of the current context, it is surprisingly high! Indeed, the fall in industries sector growth rate contributed significantly to the fall in GDP growth rate. Resilience of agriculture and services sectors are perhaps more by design! Crops and horticulture experienced more drastic fall. It is important to remember that production data for Aus and perhaps also Aman were considered for the crop sector, and not Boro which is the major crop. While the manufacturing sector was struggling even before the pandemic struck, the fall in growth rate for construction sector was not significant. It was surprising to see that growth of the services sector, against all odds, did not fall by any significant margin. The more affected sectors as identified by CPD (i.e. hotels and restaurants; transport, storage and communication; and community, social and personal services) did not experience any major fall in growth. It needs to be asked if the resilience of the services sectors as depicted above, is 'resilient' by design. The growth estimates for these sectors may not align with what happened in the performance of the real economy.
Curiously, even during a year of pandemic, private investment registered a notable growth. Private investment as a share of GDP increased to 23.63 per cent in FY20 from 23.54 per cent in FY19 - which required a nominal growth of 10.40 per cent. It may be recalled that MoF (during budget) predicted that private investment as a share of GDP was predicted to decline to 12.70 per cent in FY20. A rise in private investment is indeed unexpected when the entrepreneurs have been struggling to keep the existing production capacity fully operational. Public investment as a share of GDP, on the other hand, also increased to 8.12 per cent in FY20 from 8.03 per cent in FY19. Overall, investment as a share of GDP increased to 31.75 per cent in FY20 from 31.57 per cent in FY19. On the other hand, this implied a significant deterioration in productivity. The Incremental Capital Output Ratio (ICOR), in a single year has risen to 6.06 in FY20 (the highest since FY02) from 3.87 in FY19 indicating falling productivity of capital.
DO GDP ESTIMATES CONSIDER REAL TIME CREDIBLE DATA: To understand this paradox, one would need the estimation methodology and data sources used for GDP estimation. As a matter of fact, other than industries sector (except for construction) and crop sector, GDP estimates for majority of the sectors do not consider real time credible data. Indeed, more than half of the provisional GDP estimates are not based on credible real time data. This is also reflected when the variations of sectoral GDP growth rates are examined. A simple standard deviation test for sectoral GDP growth rates shows that growth rate of services sector was by far the most stable. It may not be due to the resilience of the subsectors; rather it originated from the weaknesses in the estimation process.
There is a serious need to take urgent steps to address the weaknesses in the data for estimating a credible GDP growth. A number of surveys will need to be conducted on a regular basis. For example: (i) Annual Establishment & Institution Survey (AEIS); (ii) Private commercial mechanized transport survey; (iii) Survey of Private Education Services in Bangladesh; (iv)Survey of Private Health Establishments; (v) Survey of Non-profit Institutions Serving Households; (vi) Farm Forest Surveys. These surveys have not been conducted over the last decade. There is a need to improve data quality from a number of government agencies-- for example, Livestock Department, Directorate of Fisheries etc.
WHAT DO UPDATED TRENDS IN PROXY INDICATORS TELL US: The provisional estimates of GDP significantly rely on budget data from the government - a large part of the budgetary allocations remains unspent and undermines GDP data quality. While the GDP estimates could not capture the updated data, a short review of recent trends (particularly during the last quarter of FY2020) of some proxy indicators may be useful.
• Total export declined by (-) 51.2 per cent during Apr-Jun quarter of FY20. Quantum index of industrial production (QIIP) for large and medium manufacturing industries declined by (-) 24.50 per cent in April 2020.
• Only 76.80 per cent of original ADP could be spent (80.70 per cent of RADP) in FY20 according to IMED data - in nominal terms (-) 1.70 per cent lower than last year.
• Again, private sector credit recorded 8.60 per cent growth as of June 2020 - the lowest in the decade.
• Rural credit in Jul-May of FY20 dropped by 12.0 per cent; while, SME loan declined in Jul-Mar by 1.30 per cent. Term loan increased by on 4.6 per cent during Jul-Mar period.
• Net FDI, in FY2020, declined by (-) 42.5 per cent.
• In FY2020, import of capital machinery declined by (-) 33.80 per cent.
• Import of other key capital-intensive items also declined sharply [Clinker: (-) 11.60 per cent; Iron, steel & other base metals: (-) 4.8 per cent; other capital goods: (-) 18.1 per cent].
• In April, total revenue collection declined by (-) 34.6 per cent. Finally, according to MoF data, only 50.40 per cent of the allocated budget could be spent up to April.
HOW USEFUL IS THE PROVISIONAL GDP ESTIMATES FOR POLICYMAKING: The provisional estimates of GDP did not capture the impact of Covid-19 pandemic on Bangladesh economy in FY20. The provisional estimates of GDP should not inform the policymaking in the coming months as it does not provide a reliable assessment about the actual health of the economy. The provisional estimates of GDP indicate that Bangladesh economy was already losing its steam even before the Covid-19 pandemic. The weaknesses in GDP estimation and dearth of real-time data were exposed by the GDP estimates in the time of pandemic when there is a heightened need for credible real time data. The government's own initiatives in the form of stimulus packages and expanded safety net programmes do not tally with the GDP growth narrative.
The government must appreciate the value of data integrity. Policymakers need to acknowledge that credible and up-to-date data provides a strong foundation for sound and effective policymaking. The government/BBS should take urgent steps to generate credible and updated data. The final GDP estimates should be informed by the reality on the ground. BBS must be adequately strengthened with both financial and non-financial resources to conduct required surveys annually (even if it is on a limited scale) so that GDP estimates are credible. BBS should also scrutinise data provided by other government agencies to ensure the quality of the data used for GDP estimations, as it is mandated by the Statistics Act, 2013.
It is now critical to take necessary steps to conduct GDP estimation on a quarterly basis and at the subnational level - this will provide more transparency and can guide the policymakers in real times. BBS should make background data and calculation available for GDP and other indicators for transparency and better accountability.
The need for updated data should not be limited to GDP estimations - the fiscal budgetary data should be assessed at the earliest to review the national budget. Data should be adequately prioritised in view of the Covid-19 pandemic, GDP should not be 'the indicator' to understand the health of the economy and monitor the path of recovery. The government should take immediate steps to revive Annual (if not quarterly) Labour Force Survey and expedite the Household Income and Expenditure Survey to assess the employment and poverty (and inequality) situation. Indeed, the recovery performance of the economy should be measured in terms of employment, poverty and inequality trends. Disaggregated data should be prioritised in view of attaining the SDGs aspiration of 'leave no one behind'.
Independence of the BBS is critical for restoring credibility of official data. BBS should be endowed with adequate financial resources to undertake the needed tasks. CPD, to this end, reiterates its earlier suggestion to constitute an Independent Statistical Commission to guide and steer the transition towards greater data reliability and integrity.
The write-up is prepared on the basis of 'Provisional Estimates of GDP Growth in FY2020: CPD's Reaction' presented on virtual press briefing on August 16, 2020. [www.cpd.org.bd]

Estimation of GDP in Bangladesh needs a reform

Over the past decade, growth rate of the Gross Domestic Product (GDP) has been at the centre of attention of economic policy discourse in Bangladesh. However, Centre for Policy Dialogue (CPD) has also been emphasising that qualitative and distributive aspects of GDP growth are no less important t

www.thefinancialexpress.com.bd

 

[Indos]

@Destranator bro, you need to make paragraphs to make it readable and please make a space between paragraphs

 

[Destranator]

@Destranator bro, you need to make paragraphs to make it readable and please make a space between paragraphs

They are readable at my end on phone browser. What platform are you using?

 

[Black_cats]

@Destranator bro, you need to make paragraphs to make it readable and please make a space between paragraphs

Ignore him not even something to be discussed. Already discussed number of times in the forum. His alike @idune posted these threads and articles so many times.

Just letting him to continue as much as he wants after that this thread will be closed as similar threads already exists and enough discussion is already done.

He is upset about this thread that's why created it.

Fast track mega projects to contribute 3-4pc to GDP growth

Fast track mega projects to contribute 3-4pc to GDP growth https://www.bssnews.net/?p=508463 By Syed Shukur Ali Shuvo DHAKA, Dec 31, 2020 (BSS) – The country’s Gross Domestic Product (GDP) is expecting to increase by 3 to 4 percent once the fast track and mega projects of the government are...

defence.pk

 

[Bilal9]

WB questions government data about GDP growth
FE Online Report | Published: April 09, 2018 18:29:15 | Updated: April 11, 2018 18:44:02

The World Bank (WB) on Monday has expressed doubts about the Bangladesh’s 7.65 per cent GDP growth projection for the current fiscal raising questions regarding some government data.
The Washington-based lender also said the GDP growth is expected to be within the range of 6.5 to 6.6 per cent in the medium term of the current fiscal.
“The robust growth for the current fiscal is doubtful as its correlation with some government statistics is not matched,” said WB Lead Economist Dr Zahid Hussain during a presentation of the Bangladesh Development Update Dhaka.
Hussain raised questions about the government data of the higher manufacturing growth, lower service sector growth compared to its higher job creation, production capacity of the industrial sector, stagnant investment, labour income growth and remittance growth, volatile food and non-food inflation data.
The Bangladesh Bureau of Statistics has recently revealed that Bangladesh’s Gross Domestic Product (GDP) is expected to grow at 7.65 per cent in FY18, which is even higher than its target of 7.5 per cent.
“How this higher growth is furnished with this production capacity in the industrial sector we are noticing over the years? It is only be possible when the production capacity will picked up. But question is --how the capacity has climbed within a year?” Dr Hussain questioned.
He said the manufacturing sector has been estimated to grow faster this year than last year although the private sector investment is observed almost stagnant over the years.
The Lead Economists said the growth is shown mainly based on the expansion of the consumer’s demand or consumption which is not in sync with government’s relevant data.
“But we do not see any leap in any of the cases. The growth of employment was at 2.2 per cent while the labour income was at 2.7 per cent in 2017,” he added.
“Remittance inflows have recovered. Yet, the level of remittance still remains 2.7 per cent less than in July-march of fiscal year 2015-16,” he said.
He asked an explanation or clarification on the government data of projected growth for FY18.
WB Country Director Qimiao Fan was present among others at the function in Dhaka.

kabirhumayan10@gmail.com

WB questions government data about GDP growth

The World Bank (WB) on Monday has expressed doubts about the Bangladesh’s 7.65 per cent GDP growth projection for the current fiscal raising questions regarding some government data. The Washington-based lender also said the GDP growth is expected to be within the range of 6.5 to 6.6 per cen

thefinancialexpress.com.bd

@Destranator bhai I realize that there may be some book cooking going on, but I'd question the degree on which these 'investigative' pieces suggest they are occurring.

I mean these stories are all from three years ago (2018). If this was such a big deal, then why wasn't more written about this?

They are readable at my end on phone browser. What platform are you using?

I'm using a Windows 10 OS, and I don't see paragraphs either.

I guess phones show paragraphs differently.