Bangladesh's economy is currently subject to probably the harshest test of resilience it has faced in recent memory. In the past, growth continued to be resilient despite several external shocks that slowed exports, remittance, and investment. Bangladesh’s resilience to global shocks came from strong fundamentals at the onset of the crisis, competiveness of exports and migrant labor, relatively under-developed and insulated financial markets, and a pre-emptive policy posture. Bangladesh has a robust disaster management capacity to deal with natural disasters, undertake rescue operations, and conduct post-disaster relief and rehabilitation.
A huge and chaotic conversation over how to respond to the appalling Rana Plaza factory collapse in Bangladesh (where the death toll has now passed an unprecedented 1100) is producing some important initial results, in the form of the international ‘Accord on Fire and Building Safety in Bangladesh’, launched last week.
I got a glimpse of the background on Wednesday at a meeting of the Ethical Trading Initiative, which brings together big brand retailers, including garment companies, trades unions and INGOs like Oxfam to work on wages and conditions in company supply chains. The Accord got some pretty rave reviews – ‘absolutely historic’, said Ben Moxham of the UK Trades Union Congress; comparable to the 1911 Chicago factory fire, according to one of the big clothes retailers at the meeting.
So what does it say? The Accord covers independent safety inspections, publicly reported; mandatory repairs and renovations; a vital role for workers and trade unions, including a commitment to Bangladesh’s Tripartite Plan of Action on Fire Safety (a national initiative). A key, and controversial aspect is that the Accord will include a legally binding arbitration mechanism, which wins a lot of trust from civil society and trade unions, but has spooked a number of companies based in the litigation-tastic USA (not all though – part of Tommy Hilfiger’s in there, while Abercrombie and Fitch have said it they will join).
According to recent estimates, South Asia is facing a shortage of 38 million housing units, largely affecting low and middle-income households. It comes as no surprise that informal settlements, slums and squatters are growing in all major urban centers across Asia to supplement the demand from urban poor. India alone has 52,000 slums inhabited by 14 percent of its total urban population. Almost, 50 percent of total population in Karachi, i.e. 7.6 million persons, lives in Katchi-Abadis. Bangladesh has 2,100 slums and more than 2 million slum dwellers in Dhaka. Even in Afghanistan, 80 percent of residents in capital city, Kabul, live in informal settlements.
In the World Bank, we recently did a report titled Bangladesh: Towards Accelerated, Inclusive and Sustainable Growth—Opportunities and Challenges. For this study, we did a survey of 1,000 garment firms to get their perspectives on the drivers and obstacles to urban competitiveness. I report below some key findings from the survey presented in the growth report.
Dhaka City is still the most productive location for garment firms in Bangladesh. Access to markets and a relatively better quality of power supply are Dhaka city’s main comparative advantages. Dhaka has the best-performing city locations for access to skilled labor and power supply––the two factors garment firms’ value most when deciding on location––proximity to suppliers, sub-contractors, machine-repair technicians and support businesses.
Dhaka is falling behind other locations in accessibility and, for some firms, Dhaka city’s costs have started outweighing opportunities. Dhaka is the worst-performing location for urban mobility and access to the highway. Firms in the city also are disadvantaged in access to the port and airport, compared to those located in Chittagong city. Both firms and workers located in Dhaka also struggle with limited availability and high prices of land and housing.
There is little empirical regularity that is as universal as the following: no matter what the path of economic development a country has followed, urbanization has been an inevitable consequence across the world. Already half the world’s population is urban. Currently, Asia and Africa are the least urbanized regions, but they are expected to reach their respective tipping points–that is when their urban populations will exceed the rural population–in 2023 and 2030. While the urban transition occurs with diverse growth patterns at different times, the real challenge for governments is to take actions that allow residents to make the most of living in cities.
The relationship between urbanization and economic development has long been a popular issue of debate. Should a developing country encourage urbanization? While this is a real dilemma in Bangladesh, because of a highly unfavorable land-population balance, the only alternative Bangladesh has to urbanization is urbanization. The question is not whether Bangladesh should urbanize; the question is how Bangladesh will handle the challenges of urbanization.
The latest science, described in the World Bank report “Turn Down the Heat,” indicates that we are heading toward a 4° C warmer world, with catastrophic consequences in this century. While carbon dioxide (CO2) is still the No. 1 threat, there is another category of warming agent called short-lived climate pollutants (SLCPs). Mitigating these pollutants is a must if we want to avoid the 4° C warmer future.
The main SLCPs are black carbon, methane, tropospheric ozone, and hydrofluorocarbons. They are potentially responsible for more than one-third of the current warming. Because SLCPs have a much shorter lifetime in the air than CO2; reducing their emissions can create almost immediate reduction of global/regional warming, which is not possible by reducing CO2 emissions alone. According to one U.N. report, full implementation of 16 identified measures to mitigate SLCPs would reduce future global warming by about 0.5˚C.
In this blog, we will focus on one SLCP – black carbon. Black carbon is a primary component of particulate matter (PM), the major environmental cause of premature deaths globally. As a climate pollutant, black carbon’s global warming effects are multi-faceted. It can warm the atmosphere directly by absorbing radiation. When deposited on ice and snow, black carbon reduces their reflecting power and increases their melting rate. At the regional level, it also influences cloud formation and impacts regional circulation and rainfall patterns such as the monsoon in South Asia.
Can we break poverty traps? An interesting new paper by Oriana Bandiera, Robin Burgess, Narayan Das, Selim Gulesci, Imran Rasul, and Munshi Sulaiman adds to this emergent literature with a definitive “yes we can.” Bandiera, et. al. evaluate a program run by the NGO BRAC which provides a significant infusion of capital, coupled with training, for Bangladeshi women.
Click here to view the full Infographic in high resolution.
Tomorrow, a Learning for All Ministerial Meeting will bring together development partners and ministers of finance and education from Bangladesh, the DRC, Ethiopia, Haiti, India, Nigeria, Yemen, and South Sudan – home to nearly half of the world’s out-of-school-children – to address challenges and steps to ensure that all children go to school and learn.
Considering the costs, it was never obvious to me how investments in a national identity program might add development value in a resource-crunched country like Nepal with so many competing priorities. It clicked when a senior official at Pakistan’s National Database and Registration Authority (NADRA) said, “The national identity program has allowed us to construct one big family tree of all Pakistani nationals. It is helping Pakistan establish a relationship between each member of our extended family and to redefine our obligations to one another — state to citizen and citizen to citizen.”
All it took was an invitation to open the floodgates. More than 1,200 South Asian youth responded to our call to share ideas on how to end gender-based violence in the region. The judges had the difficult task of picking 10 winners from about 60 finalists, but there were many more great solutions submitted. Here are some of my personal favorites that were not selected.
The emergence of mega-regions, as metropolitan areas merge to form a system of cities, has demonstrably contributed to growth in the developed countries. With South Asia experiencing one of the highest urbanization rates, connecting cities presents opportunity to mobilize people, goods and services, and develop supply chains over larger spatial areas. However, this also implies unraveling overlapping commuting patterns, economic linkages, social networks, multiple jurisdictional boundaries- which add to the complexity of decision-making for policymakers and practitioners.
Join an online discussion with Ismail on Tuesday, April 2nd at 8-11AM on the World Bank's South Asia Facebook page to ask questions and learn more about his experiences.
The Dalai Lama once said - that if you ever feel you are too small to make a difference then try sleeping in a room with a mosquito. And the same goes for business. Every big business starts as a small business. General Electric was at one time the world's biggest company and it started with a simple but revolutionary idea - the invention of the incandescent light bulb in 1878 and the vision of just one person Thomas Edison.
Walmart started with a single store in 1945 and is now the largest private employer in the world. Starting with one store and the idea of making lots of cheap goods available all over the US, Walmart has created more than 2 million jobs. And of course more recently we have lots of examples in the technology and innovation space Apple, Microsoft, Google, Amazon, Ebay, Dell and Facebook. All are multi-billion dollar companies that started out in a single room, a basement or garage with a simple idea shared at first by a one or two people.
At the 9th South Asia Economics Students' Meet on Green Growth, participants shared their vision about South Asian cities of the future. These are their innovative ideas.
Without taking care of the environment we are shaving digits off GDP and, therefore, limiting our very potential for the future.
Economic growth in South Asia is driven primarily by exports which has led to expanded production requirements needed to fuel an ever increasing amount of trade. This has accelerated the environmental degradation of many countries in the region. Gradual environmental degradation, climate change and diminishing natural resources create extra pressure to adopt different approaches in supporting the export-driven economic activities. The past axiom of “grow first, clean up later” cannot run more in a region which has limited natural resources and a rapidly growing population directly dependent on natural resources. These countries are now shouldering an increasingly greater share of regional and global environmental production-related burdens.
It was heartening to attend the recent Partnership for Market Readiness (PMR) forum at the World Bank, where countries renewed their commitments to testing and piloting market-based instruments for greenhouse gas emission reduction. The PMR is country-led and builds on countries’ own mitigation priorities. Focus is placed on improving a country's technical and institutional capacity for using market instruments to scale up climate change mitigation efforts.
Friday, March 15 is the deadline to join the World Bank in a call against gender-based violence. Participate in a text message contest for South Asian youth (18-25) – we want to hear your best ideas in response to the question, “What Will It Take to End Gender-Based Violence in South Asia?”
I grew up in Delhi, and it has always been unsafe for women and girls. In recent years I lived in Washington, D.C, which was a different world altogether. It was a welcome relief to travel on public transport without having men constantly staring at your body.
Then in December, just before I was to move back to Delhi, I heard about the brutal gang rape in my hometown. I felt outrage and deep anguish watching the news unfold the horrific story leading to the painful death of the victim.